Toyota Agrees to Pay NHTSA $17.35 Million in Single Highest Civil Penalty Ever
In an action that represents the single highest civil penalty amount ever paid to the National Highway Traffic Safety Administration for violations stemming from a recall, this morning Toyota agreed to pay $17.35 million to settle claims related to the timeliness of a recall made back in June.
That campaign was to address the potential for accelerator pedal entrapment caused by unsecured or incompatible driver’s side floor mat in the 2010 Lexus RX 350 and RX 450h. Toyota said the fine comes without admitting to any violation of the automaker’s obligations under the U.S. Safety Act.
Toyota North America chief quality officer Ray Tanguay said, “Toyota is dedicated to the safety of our customers, and we continue to strengthen our data collection and evaluation process to ensure we are prepared to take swift action to meet customers' needs.
“We agreed to this settlement in order to avoid a time-consuming dispute and to focus fully on our shared commitment with NHTSA to keep drivers safe,” Tanguay continued.
Reacting to the developments, TrueCar.com executive vice president of industry relations Larry Dominique said, “NHTSA takes its role seriously and expects manufacturers to inform them quickly of potential safety issues.
“The Toyota fine is an example of ensuring manufacturers respect the process and notify NHTSA in a timely manner,” Dominique added.
Federal law requires all automakers to notify NHTSA within five business days of determining that a safety defect exists or that the vehicle is not in compliance with federal motor vehicle safety standards and to promptly conduct a recall.
Early this year, NHTSA's Office of Defects Investigation said it began to notice a trend in floor mat pedal entrapment in 2010 Lexus RX 350s in vehicle owner questionnaires (VOQs) and early warning reporting data.
In May, NHTSA contacted Toyota regarding the trend, and a month later Toyota advised NHTSA that it was aware of 63 alleged incidents of possible floor mat pedal entrapment in model year 2010 Lexus RX 350s since 2009. Toyota’s own technicians and dealer technicians reported that certain alleged incidents of unwanted acceleration had been caused by floor mat pedal entrapment.
Then in June, Toyota advised NHTSA that it would conduct a recall of 154,036 model year 2010 Lexus RX 350 and model year 2010 RX 450h vehicles to address floor mat pedal entrapment.
As part of today’s settlement, Toyota and its U.S. based subsidiaries agreed to make internal changes to their quality assurance and review of safety-related issues in the United States and to improve their ability to take into account the possible consequences of potential safety-related defects.
The last time Toyota faced civil penalties was in 2010 when the automaker agreed to pay $48.8 million as a result of three separate investigations into the automaker’s handling of auto recalls. The automaker paid maximum civil penalties for violations stemming from the pedal entrapment, sticky pedal and steering relay rod recalls.
“Safety is our highest priority,” said U.S. Transportation Secretary Ray LaHood. “With today’s announcement, I expect Toyota to rigorously reinforce its commitment to adhering to United States safety regulations.”