Toyota Motor Corp.
) announced that it would recall 185,000 units of some subcompact
car models globally due to a problem with their electric power
steering system. The glitch is making the steering heavier.
However, no accidents were reported due to the problem.
The recalled vehicles include Yaris (know as Vitz in Japan) and
Verso-S (aka Lactis in Japan) subcompact models. The recalled
Yaris vehicles were manufactured between Nov 2010 to Mar 2012
while Vero-S vehicles are made between Aug 2010 and Aug 2011.
Toyota will recall nearly 130,000 vehicles in Japan, about
7,050 vehicles in Germany, about 7,000 vehicles in France and the
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Toyota has been criticized continuously due to its series of
vehicle safety recalls from the past few years. In Sep 2009, TM
made the announcement of largest-ever global recall of 3.8
million vehicles triggered by a high-speed crash in California
that killed 4 members of a family. Later on, a string of recalls
has led Toyota to face numerous personal injury and wrongful
death lawsuits in federal courts.
A few months ago, the U.S. Transportation Department slapped a
fine of $17.35 million on Toyota due to a late response regarding
a defect in its vehicles to safety regulators as well as late
recall of those vehicles.
According to the department, it was the maximum allowable fine
under the law for not initiating a recall in a timely manner. The
fine added to $48.4 million imposed by the U.S. government on the
company in 2010 due to late recall of millions of defective
In April, Toyota along with other Japanese automakers,
Honda Motor Co.
Nissan Motor Co.
) and Mazda Motor Corp. have decided to recall 3.4 million
vehicles globally for an identical problem. All these automakers
plan to recall vehicles for fixing defective airbag system in
their vehicles, supplied by Japanese auto parts maker Takata
Toyota recalled 1.73 million vehicles globally. Among them,
580,000 vehicles were recalled in North America, 490,000 vehicles
in Europe and 320,000 vehicles in Japan. Honda announced recall
of 1.14 million vehicles worldwide while Nissan recalled about
480,000 vehicles and Mazda about 45,500 vehicles globally.
A few stocks that are worth considering in the automotive
industry at present include Nissan Motor Co. and
Fuji Heavy Industries Ltd.
). Each of them carries a Zacks Rank #1 (Strong Buy).