Toyota recalls 1.7 million cars for fuel leaks
POSTED: Wednesday, January 26, 2011 - 11:18pm
UPDATED: Tuesday, February 1, 2011 - 6:16am
TOKYO – Toyota recalled nearly 1.7 million cars worldwide Wednesday for possible fuel leaks, the latest in a ballooning number of quality problems that could further tarnish the company's reputation in the United States.
The recalls are mostly in Japan, but include Lexus IS and GS luxury sedans sold in North America. That's where the world's No. 1 car company faces the biggest challenges in winning back customer trust.
U.S. dealers will inspect cars to see if loose fuel pressure sensors caused leaks. There were no accidents suspected of being caused by those problems, according to Toyota. The car maker has received 77 complaints overseas, 75 of them in North America, and more than 140 in Japan.
The latest quality hitch follows a spate of recalls that began in late 2009, mostly in North America, which now cover more than 12 million cars and trucks. The recalls involve defective floor mats and gas pedals that get stuck, some of them suspected of causing unintended acceleration.
Wednesday's recalls come exactly one year after Toyota stopped selling eight models in the U.S. because of unintended acceleration problems. The sales suspension affected 60 percent of Toyota's lineup in the U.S., and was the first of four sales halts last year. .
Koji Endo, auto analyst with Advanced Research Japan Co. in Tokyo, said the newest recalls will cost Toyota about 20 billion yen ($240 million), but won't hurt its earnings much.
"But there is that perception of here we go again, and that hurts Toyota's image, especially in North America," he said.
The biggest damage to Toyota's image has been in the U.S. where its response to safety problems was seen as slow. The company's U.S. sales lagged last year despite an industry recovery. Some believe that Toyota's relentless drive for growth hurt quality.
The company has lost some potential U.S. customers: A survey done by consumer website Edmunds.com showed that 17.9 percent of all car shoppers last month were considering a Toyota, a 3.8 percent point drop from a year earlier. That drop in consideration could be blamed on Toyota's recalls, as well as its aging lineup.
"Toyota needs to overcome not just the PR damage sustained by last year's recalls, but also the reality that many of its models are stale," said Jessica Caldwell, director of pricing and industry analysis for Edmunds.
Toyota has stayed popular in Japan, partly because government incentives for green vehicles sent sales of its Prius gasoline-electric hybrid booming.
The company is likely trying to be aggressive with recalls and so the latest one is not a sign that quality is taking another dive at the company, Endo said.
To help respond to customer complaints and investigate quality concerns quickly, the company recently opened two new field offices, in Houston and Jacksonville, Fla. It plans to open another in Denver by the end of the first quarter, and already has offices in New York and San Francisco. The offices are part of Toyota's plan to improve global quality and communication within the company.
In the latest recalls, the largest number of the affected vehicles was in Japan at nearly 1.3 million — the second-largest auto recall in that nation's history. It involved two different problems.
In one of the problems announced Wednesday, an improper installation of a sensor to measure fuel pressure may cause the device to loosen as a result of engine vibrations, and possibly cause fuel to leak, the company said. That problem also affects 280,000 Lexus cars sold abroad, most in North America.
Included under that recall are the 2006 through 2007 Lexus GS300/350, 2006 through early 2009 Lexus IS250, and 2006 through early 2008 Lexus IS350 sold in the U.S.
Lexus dealers will inspect the vehicles for fuel leakage and will tighten the sensor, if nothing is leaking. If a leak is confirmed, the gasket between the sensor and the delivery pipe will be replaced, it said.
That same problem was also found in the Crown and Mark X models sold in Japan.
The second problem, which affects 141,000 Avensis sedans and station wagons sold in Europe, and New Zealand, was caused by irregular work on the fuel pipe, which may cause cracks and fuel leakage, Toyota said.
That problem was also found in 16 models sold in Japan, including the Noah subcompact, RAV4 sport-utility vehicle and Wish cars.
Toyota also recalled 6,000 trucks made by group company Daihatsu Motor Co., which were sold under the Toyota brand in Japan, for a problem with a metal part connecting a spare tire to the bottom of the truck. The tire could come loose and fall on the road, Toyota said.
Chief Executive Akio Toyoda, the grandson of the automaker's founder, has vowed to regain trust and respond quicker to customer needs.
Toyota shares fell nearly 2 percent to close at 3,400 yen ($41) in Tokyo.