Toyota Motor Corporation TM has announced a temporary halt on shipments and sales of three models in Japan, effective immediately, amid a safety scandal.
What Happened: Toyota Motor Corporation disclosed on Monday in a press release that it is suspending shipments and sales of the Corolla Fielder, Corolla Axio, and Yaris Cross models in Japan. This decision follows an internal investigation into model certification applications, as per instructions from the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) on Jan. 26.
The investigation revealed that seven models, including some discontinued since 2014, were tested using methods that deviated from government standards. Toyota reported these findings to MLIT on May 31. The affected models included both domestic and overseas vehicles, such as the Yaris and Avanza.
Despite confirming no performance issues that violate laws and regulations, Toyota has opted to halt shipments and sales of the three current models.
“We sincerely apologize for any concern or inconvenience this may cause to our customers and stakeholders who have placed their trust in Toyota,” the company stated.
Why It Matters: Toyota is among five carmakers, including Honda Motor Co. and Mazda Motor Corp., which reportedly falsified or manipulated safety data while applying for certification, Bloomberg reported on Monday.
This latest development comes on the heels of a series of compliance issues within Toyota’s subsidiaries. In December, Daihatsu, a Toyota subsidiary, halted shipments after an investigation revealed safety test manipulations involving 64 models and 3 engines. The affected models included both domestic and overseas vehicles, such as the Pixis Epoch and Raize.
Furthermore, in March, Toyota announced a cultural overhaul and leadership restructuring following safety violations. This initiative, presented by CEO Koichi Ito, aims to prioritize legal compliance and enhance transparency within the organization. Senior executives, including the president, will partially refund their salaries for non-compliance with certification standards.
Price Action: Despite the crackdown, on Monday, Toyota Motors was trading 0.13% higher in the U.S. pre-market at $217.79 at the time of writing after it closed at $217.51 on Friday, as per Benzinga Pro.
Image via Shutterstock
This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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