Toyota's "Wins for Toyota-Safety": $100 Million by Avoiding Finding the Acceleration Problem

The Toyota hearings this week–particularly Wednedsay’s hearing featuring Akio Toyoda–are looking more and more devastating. The Detroit News reports that the House Oversight Committee has an internal Toyota presentation from last July boasting that it had saved $100 million by doing its bullshit floor mat recall in 2007, rather than isolating the real source of the acceleration problem.

Toyota Motor Corp. officials bragged in July about avoiding a costly wholesale recall related to sudden acceleration complaints, a document turned over to congressional investigators shows.A limited recall saved the Japanese automaker, whose executives will be grilled by congressional committees starting Tuesday, more than $100 million, according to the presentation obtained by The Detroit News on Sunday


The document acknowledges Toyota was still studying the issue of “sudden acceleration on ES/Camry, Tacoma, LS, etc.,” but notes that Toyota’s safety officials had saved the company significant expense by limiting the recall to 55,000 floor mats in 2007.

“Negotiated ‘equipment’ recall on Camry/ES re SA (Sudden Acceleration); saved $100M+, w/ no defect found,” the document said.

The $100 million plus in savings was listed in a section titled “Wins for Toyota-Safety Group.”

Note that the briefing was for Yoshimi Inaba, who had just started as head of Toyota North America. Inaba will still be testifying Wednesday, along with Akio Toyoda.

And this is damning for two reasons. First, boasting about the recall while admitting they hadn’t really found the solution–while pushing the floormat recall everyone knew to be totally bullshit–really speaks to the arrogance of the company. Moreover, in light of the really obvious whitewash that Toyota is still conducting–a study that by design will never find the source of the problem–it makes it clear that Toyota is still pursuing this strategy: cheap fixes rather than trying to actually find and solve the problem.

Update: And now the feds are getting into the action. (h/t scribe)

The Japanese automaker said it received a subpoena from a federal grand jury in New York seeking documents related to unintended acceleration in its vehicles and the braking system of its Prius hybrid.

Toyota also said it received a subpoena and a voluntary document request from the Los Angeles office of the U.S. Securities and Exchange Commission. The SEC is seeking documents related to unintended acceleration as well as to its disclosure policies and practices, Toyota said.


Toyota said it received the grand jury request from the Southern District of New York on Feb. 8. It received the SEC requests on Friday. It disclosed the latest requests in a filing with the SEC on Monday and said it intends to comply with the requests.

  1. Leen says:


    Ew the issue that Obama did not mention during SOTU (and you did the next day) on the Diane Rehm show now

    10:00Foreclosure Risks in Home and Commercial Real Estate Markets

    Guest host: Katty Kay

    Concerns are growing that the home mortgage crisis will extend to the commercial real estate market. We discuss the Obama administration’s latest plan to help stem foreclosures in the hardest hit housing markets and what a new wave of office and retail foreclosures could mean for the economy.


    Mark Zandi, chief economist of Moody’s Analytics and author of “Financial Shock” and the forthcoming book, “Paying the Price.”

    Damian Paletta, reporter, Wall Street Journal

    Kathleen Day, Center for Responsible Lending

  2. ApacheTrout says:

    Do we know whom among the regulators bought into signed off on the floormat recall that made Toyota so proud? That Toyota sought such a light remedy is no surprise to me, and that the Bush Administration’s regulator’s agreement to the favorable recall terms is equally unsurprising (nonetheless still a shocking admonition of duty). So is this regulator(s) still in employed? And should we be examining the records of said regulators?

  3. ApacheTrout says:

    from the Detroit News article:

    In another weekend development, The Detroit News obtained a series of e-mails Saturday between State Farm and NHTSA officials in 2004 that show the government had already been probing sudden unintended acceleration claims, when insurer State Farm notified the government of a spike in complaints.

    The e-mails show NHTSA was appreciative of the “timely” submissions by the insurer. The records also show that NHTSA continued to work with State Farm in 2009 as it further probed the issue of unintended acceleration in Toyota vehicles.

    But the new e-mails don’t shed any new light on why NHTSA ended its investigation in July 2004 without requiring any action by Toyota Motor Corp. NHTSA dropped its investigation because it didn’t find a safety defect or any evidence of an unreasonable safety risk, the government said.

    my emphasis

    So we have an insurance company with a flair for statistics, providing evidence of a safety problem to the government, and the government dropping its case saying there’s nothing there to see. Things that make you go hmmmmm…..

  4. ecthompson says:

    E –

    This is not a surprise. Toyota has learned from GM, Ford and other manufactures. Remember the Pinto gas tank?

    Here’s my problem with this hearing. What happens after the CEO gets his tongue lashing? R’s and D’s will take pot shots at this guy (expect for congressmen who have Toyota plants in their states. This would include Indiana, Texas, Alabama and Kentucky to name a few of the 14 states). What happens next? Will this be the same as with the bankers? After the hearing we have business as usual?

      • whitewidow says:

        Yes, and the driver had his family in the car, on the way home from church. It seems very unlikely that the guy would be traveling up a ramp at 90 mph out of carelessness, and no alcohol or drugs were involved.

        Extremely sad all the way around. I hope that the prosecuting attorney, Susan Gaertner, takes another look at this without delay.

    • DWBartoo says:

      Toyota has much to answer for, whitewidow.

      As bwaz says, … appalling.

      How shall the SHAME be dealt with?

      Which “tradition” will triumph?


  5. earlofhuntingdon says:

    It’s damning, too, because it is a smoking gun. Toyota has pulled a Pinto: it is bragging about saving a nine-figure sum – in a safety-related recall, the highest priority there is – and knowingly hadn’t fixed the problem. It literally pulled the rug over transportation safety regulators and the car driving public. Not just the public that buys their cars, mind, but everyone on the road.

    The shit hasn’t yet hit the fan, Toyota’s reputation, its management ranks or its financial statement.

  6. earlofhuntingdon says:

    If more evidence comes out supporting that Toyota intentionally misled the public and federal regulators, the number of lawsuits will reach biblical proportions and punitive damages should be the order of the day. Those would primarily be state law claims, not federal. The feds could impose sanctions, too, and multi-state actions would find their way into federal courts.

    No wonder Toyota’s base course has been to work its lobbyists 24/7. It must be hoping for a Rahmy deal rather than contend with the natural and logical consequences of its apparently egregious and public-threatening conduct.

    This is fast becoming a textbook example, even in George Bush land, of how not to handle an engineering-cum-legal-cum-marketing headache. It may be enough to revive figurative, if not literal, sepuku.

    • whitewidow says:

      the number of lawsuits will reach biblical proportions and punitive damages should be the order of the day.

      I smell retroactive immunity.

      snark/sort of

      • earlofhuntingdon says:

        I’m sure they’re working hard at coming up with something equivalent to immunity. Expect a deluge of rightwing vomitary about the scourge of plaintiff’s lawsuits.

        The good news for the public is that most of these claims are likely to be state law claims in state courts. And there isn’t yet the carmakers’ version of the drug lords would be FDA immunity (which I think Team Obama has at least officially pulled back from). NHTSA hasn’t that sort of power. It doesn’t certify minimal safe quality before a product hits the road; it monitors safety and other reported defects afterward. But I would watch for some unknown staffer dropping a few sentences into an unrelated bill that might make it harder to pursue claims.

        But this sort of apparently intentional alleged misconduct cries out for a common national response. The state you live in should be irrelevant to the safety of cars placed on public highways, the payment of just compensation for those harmed by egregious corporate conduct or the imposition of sanctions against a global corporation for intentionally placing the general public in harm’s way.

        • bmaz says:

          What do you think the SEC getting involved is about? It is the first step to a prophylactic civil consent settlement. Wnder who gets the rich monitoring contract? Steve Rattner?

          • earlofhuntingdon says:

            You mean the SEC “investigation”? After Bush and Don’t Look Back ‘Bama, the SEC’s investigatory staff are weak tea, when they were once old bourbon. But that would deal only with the most obvious federal claims, leaving state court suits to fester on their own.

            • bmaz says:

              Enter consent agreement to resolve all federal issues without a direct finding of culpability and then fight the individual state suits tooth and nail on the merits and make the plaintiffs prove causation. There is a template for this defense.

              • earlofhuntingdon says:

                Yup. No state court judgment is binding precedent in another state. With plaintiffs’ lawyers still gun shy after eight years of being beaten up by Rove’s thuglicans and the massive duplication of effort required to try cases separately in each of 50 states and DC, and you draw out adverse decisions for years, while pummeling injured plaintiffs and their lawyers with pro-company verdicts and the secrecy of settlement agreements.

                It’s an old playbook well-known to big auto, insurers, insurance defense firms and their legions of damage control “consultants”.

  7. qweryous says:

    Some information on the administrator of the NHTSA from May 31, 2006 to
    September 2008(?)

    Her name was Nichole R. Nason and some opinions and facts are found concerning her tenure at the NHTSA.

    “Many advocates believe that the agency has been adrift under a series of short-term administrators, beginning with Nicole Nason. A Bush appointee,
    Nason had worked as a DOT lobbyist, and as communications director for former Republican Rep. Porter Goss before assuming the leadership of NHTSA. At the time of her appointment, one auto industry lobbyist sniped in a January 2006 news story: “Maybe she has talents not yet obvious to the outside world.”” Excerpt from “The Safety Record” Dec 2009 Pg 6 LINK:

    There were some doubts and once she was in the position…a policy that Nason apparently instituted was an institutional gag order.

    “…. Nason was also responsible for a bizarre policy that effectively forbade anyone at the agency to talk to the media on the record except herself, including the NHTSA Office of Communications. Because of that policy, many of the government’s leading auto safety experts have been unable to talk directly to the media on issues within their area of expertise.” Excerpt from “Safety Blog” (Consumer LINK:

    How this new policy impacted communications with the news media -and thus
    the public- were described:

    “And it is she who put the big hush on one of the government’s most important safety agencies. I found this out recently when I asked to talk to an N.H.T.S.A. researcher about some technical safety issues in which he had a great deal of expertise. Agency officials told me I could talk to the expert on a background basis, but if I wanted to use any information or quotes from him, that would have to be worked out later with a N.H.T.S.A. official. The arrangement struck me as manipulative, and I declined to agree to it.” Excerpt from “Whats Off the Record at NHTSA? Almost Everything” by Christopher Jensen Aug 22, 2007 LINK:

    The motivation for this was- any clues here?:

    “Ms. Nason felt it was necessary for N.H.T.S.A. to have a “central spokesperson” and “we were finding a lot of stuff did not need to be on the record,” David Kelly, her chief of staff, told me. He also insisted, after our telephone conversation, that he did not want to be quoted and had intended to speak only on background. (My notes show no such request.)”
    Excerpt from “Whats Off the Record at NHTSA? Almost Everything” as cited previously.

    And with respect to enactment and enforcement of existing regulations this commentary was found:

    “The agency promulgated a weak roof crush rule complete with a preemption
    clause, and apparently stopped enforcing regulations, according to an analysis by the Center for Auto Safety. The advocacy group said that
    the agency collected more than $4.3 million in penalties from late 1995 to early 2006, and then, stopped imposing penalties altogether.” Excerpt from “The Safety Record” as cited previously.

    Whether this has any relevance to the current issues concerning NHTSA and Toyota remains to be seen.

    Then there is the matter of NHTSA Docket Number 26140.

    Some information on that is here:

    “Breakdowns happen. Ever wonder if others are having the same problems on the road? So, is there any way to know about these problems before spending any money? Look no further than the website run by the National Highway Traffic and Safety Administration or NHTSA. You’ll find millions of consumer complaints about thousands of vehicles, free of charge. All it takes is the year, make and model.” Excerpt from “NHTSA Wants to Do Away with Public Complaints on Cars” at Feb 28, 2007.

    Consumers, mechanics and even regulators might benefit from the operation of this website. But others have a different opinion.

    ” Tim Stapleton, owner, GT Automotive: “If they see the same problem happening over and over it might raise some concerns.”

    Longtime mechanic Tim Stapleton owns GT Automotive in Riverton. He thinks the NHTSA Web site could help car owners find problems faster.

    Tim Stapleton: “It saves us time, which ultimately saves the consumer money.”

    Save money yes, but more importantly save lives. Congress ordered the Early Warning website in 2002 to track vehicle safety and prevent deaths. Now NHTSA’s trying to change the rules and take away those public complaints.

    Tim Stapleton: “I can’t see any reason why they’d want to shut it down.”

    Neither could we until we discovered who’s behind the rule change. The auto industry. Every car company you can think of wants those online postings gone. They say your complaints expose “trade secrets” and hurt competition.

    Consumer groups are protesting, accusing NHTSA, a federal agency set up to protect US, of trying to protect big business instead. “Excerpt from as cited previously.

    And if the complete story is read, the issue of Toyota and sudden acceleration is discussed.

  8. shediac says:

    Hey it’s those darn union guys working for Toyota! What no union at Toyota’s American plants? Is that why Republican senators are standing by their Japanese friends. No don’t be such a cynic…

  9. kevincharlottenc says:

    If an American company had done this… if they had even tried… we would be watching their factories being torn down at this very moment. I wonder how many of us here are driving a Toyota. And I wonder why? Because it’s from the Magic Island of Nippon??? Same with Honda and Nissan, right? It’s better than an American car, how?? Because it’s Magical. I’m also reading that thousands (maybe millions) of Toyota owners are proudly stating how they’re going to keep driving their Toyota (to the grave perhaps?) no matter what, they love their Toyota… and so on. With customers this dedicated and this brainwashed and this stupid, is it any wonder the company is arrogant? They had nothing to worry about!

    Wow. Why? It’s just a piece of shit car. I NEVER heard this language (or read it) when GM had to recall and go through the humiliation over its Corvair in the 60s. Or when Ford was sued for millions and had to recall millions of Pintos in the 70s. Or when American Motors was sued, then clobbered on 60-minutes over its Jeep CJ5 (rollover incidents) in the 80s. Or when Chrysler had to recall millions of minivans, K-cars and just about everything they’ve built since the 80s and 90s… in fact the latter two companies are bankrupt and one is gone entirely. Take that American car makers!!

    But when it comes to Toyota, hey! What a wonderful thing! It speeds suddenly to 120 mph uncontrollably? Wow! Cool! It can’t stop? Wow, cool! I love Japan! I wish everything I made was gilded with gold!

  10. Neil says:

    No Apology!? No kidding.

    In the auto world, Toyota innovated what we now call “quality manufacturing” — placing such consistent attention to each detail at every step of the manufacturing process that flaws and rejects virtually disappeared. In doing so, they not only improved the value of their products, they also reduced the number of workers needed to rework defective cars. Productivity soared.

    “No Apology” by Mitt Romney (p.105-106)

  11. rosalind says:

    New article up at LA Times: Toyota’s fractured structure may be at root of safety problems

    But Toyota lacks a single U.S. headquarters; its units can operate as fiefdoms that report independently to Japan. The complicated tasks of gathering information about sudden-acceleration reports, analyzing the problems and engineering fixes, as well as reporting the issues to federal safety regulators, were handled by different Toyota subsidiaries, each managed separately in many cases from Japan, former Toyota managers and employees say.