Toyota Motor Corp.
) made headlines again by announcing its massive recall of 7.43
million vehicles worldwide that include more than a dozen models
manufactured between 2005 and 2010. The automaker needs to fix
faulty power window switches in the vehicles that can cause fire
because the manufacturer didn't have grease applied properly during
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Although it seems to be an embarrassment for the company - which
has brought the issue of vehicle safety recall into the limelight
after its global recall of 3.8 million vehicles in September 2009,
triggered by a high-speed crash that killed 4 members of a family,
Toyota has a different take on the issue.
The company considers the move to be much quicker (however the
problem was first detected long time back in September 2008 in the
U.S.) and transparent as it had learned from its mistakes in the
The recall includes vehicles sold in the U.S., Japan, Europe and
elsewhere. In North America, the company will recall a total of
2.47 million vehicles covering Yaris, Corolla, Matrix, Camry, RAV4,
Highlander, Tundra, Sequoia and Scion xB and xD models.
In Japan, the figure is 459,300 vehicles, including Vitz, Belta,
Ractis, Ist, Auris and Corolla Lumion models. In Europe, the figure
is 1.39 million vehicles, covering Yaris, Corolla, Auris, Camry and
Rav-4 models. Apart from these regions, the company will recall
650,000 vehicles in Australia and Asia, 490,000 vehicles in the
Middle East, 240,000 vehicles in Canada and 330,000 vehicles
The past string of recalls has tarnished Toyota's reputation,
resulting in declining sales and lower vehicle resale value. Since
November 2009, the automaker has recalled more than 15 million
vehicles globally in more than 20 recalls, surpassing all other
automakers. The company lost its No.1 position to
General Motors Company
Ford Motor Co.
) in terms of sales volumes in the U.S.
However, Toyota has recovered well from the twin disaster in Japan
and severe flooding in Thailand last year, apart from the backlash
of a series of safety recalls in the past. The company saw an
astounding 41.5% jump in sales to 171,910 vehicles in September
this year due to commendable sales of Corolla (42.6%) and Camry
(37.8%) sedans, Prius cars (103.0%) and Tacoma pickup trucks
In the first quarter of its fiscal year ending March 31, 2013, the
Zacks #3 Rank (Hold) company posted a significant ¥91.31 increase
in earnings to ¥91.68 per share ($1.14) due to strong demand for
its vehicles and positive impact of cost reduction measures.
However, the company's profits failed to meet the Zacks Consensus
Estimate of $1.93 per share during the quarter. Total profit surged
¥289.19 billion to ¥290.35 billion ($3.62 billion) from ¥1.16
billion a year ago.
Consolidated revenues soared 60% to ¥5.50 trillion ($68.66 billion)
in the quarter. Unit sales increased 86% to 2.27 million vehicles
during the quarter led by higher sales in all the regions including
Japan (97%), North America (140%), Europe (20%) and Asia (61%), and
Other reporting regions (83%).