Toyota saved $100m but could face criminal prosecution

Toyota on Trial

A federal grand jury in the Southern District of New York, US issued a subpoena - a writ issued by a government agency that has authority to compel testimony by a witness or production of evidence - against Toyota, whilst the Japanese carmaker has also been accused by the Congressional committee of "misleading" the public.

The subpoena demanded that Toyota and its subsidiaries "produce certain documents related to unintended acceleration of Toyota vehicles and the braking system of the Prius (pictured)". This has increases the chances of the firm facing criminal prosecution in the United States and massive fines over safety problems with several of its models.

Toyota have been forced to recall hundreds-of-thousands of its cars after a number of well publicised incidents such as faults with the accelerator on some of its models. Some newspaper reports claim up to 34 deaths are linked to problems with Toyota's cars.

"Flawed engineering"

Several top Toyota executives are set to testify before US politicians today, with the House committee on energy and commerce accusing the car company of a number of failings, such as failing to investigate reports of unintended acceleration dating back to 2000 and rushing out the results of a flawed investigation into the problem of unintended acceleration this month, after testing just six cars.

"Our preliminary assessment is that Toyota resisted the possibility that electronic defects could cause safety concerns, relied on a flawed engineering report, and made misleading public statements concerning the adequacy of recent recalls to address the risk of sudden, unintended acceleration," wrote committee chairman Henry Waxman.

Japan's wider economy could even be hit by Toyota's crisis as exports have been damaged. The total cost to Toyota for recalling millions of its models is expected to be at least US$2 billion.

"Wins for Toyota"

However, Toyota claim to have saved US$100 million through a "negotiated" recall of cars, according to a document sent to a US congressional committee.

According to Business Week, in other accomplishments described, rather insensitively, as "Wins for Toyota" the car-maker said it reduced or delayed the effect of proposed rules on roofs, door locks and protection in side-impact crashes, according to the document that was turned over to the House Committee on Oversight and Government Reform and obtained yesterday. Delaying the rules was credited with saving about $135 million.

However, no saving of any amount could save Toyota's reputation should they found criminally responsible for the faults.

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Daniel Jones

Daniel is a Politics and Philosophy graduate from Cardiff University where he also worked as a section editor on the award winning student newspaper. After university he joined an IT support company where he was a B2B online writer. He loves anything to do with sport and joined GDS in July 2009.

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