Toyota Motor Corp.
) plans to recall 150,000 units of Tacoma pickup truck in
December that belongs to the 2001-2004 model years. The trucks
will mainly be recalled in cold weather states in the U.S. and in
The company explained that metal lift plates holding the spare
tires of the trucks are not sufficiently coated with phosphate at
the time of manufacture, making them vulnerable to rust in cold
weather states where salt is used on the roads to prevent ice in
Toyota revealed that in extreme cases the lift plates could break
due to excessive corrosion and detach from the vehicle. As a
result, the company has decided to inspect the extent of
corrosion in the lift plates and repair them at no extra charge
The recall will cover 20 cold weather states in the U.S.
including Connecticut, Delaware, Illinois, Indiana, Kentucky,
Maine, Maryland, Massachusetts, Michigan, Minnesota, New
Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode
Island, Virginia, Vermont, Wisconsin and West Virginia.
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.
The Transportation Department of U.S. had also imposed a fine of
$48.4 million on the company in 2010 due to late recall of
millions of defective vehicles. As a result, the automaker has
become increasingly conscious to respond quickly to any problems
in the vehicles.
A few days back, Toyota announced plans to recall 11,000
units of Scion iQ mini cars due to a defect that is preventing
their airbags from deploying properly. The recall will affect
2012-2013 model year iQs, manufactured between July 31, 2011 and
October 12, 2012.
Prior to that, the company announced a worldwide recall of 2.77
million vehicles after its major recall of 7.43 million vehicles
last month. The recall involved 14 models including the Prius
hybrid and 2000-2006 Corolla compact sedans that are subject to
inspection and repair due to a problem with their steering and
Last month's worldwide recall of 7.43 million vehicles
included 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 they didn't have grease
applied properly during production.
Toyota, a Zacks #3 Rank (Hold) company, saw more than threefold
increase in profits to ¥257.92 billion ($3.28 billion) or ¥81.44
($1.04) per share in the second quarter of fiscal year ended
September 30, 2012 from ¥80.42 billion or ¥25.65 in the same
quarter of prior fiscal year.
The increase in profits can be attributed to strong demand for
Toyota vehicles as well as positive impact from the company's
cost control measures. However, profits were lower than the Zacks
Consensus Estimate of $1.62 per share.
Revenues in the quarter grew 18.2% to ¥5.41 trillion ($68.75
billion) on a 14.9% rise in sales volume to 2.16 million units.
Vehicle sales increased in all the regions, except Europe.
Operating income more than quadrupled to ¥340.61 billion ($4.33
billion) from ¥75.39 billion in the second quarter of previous
However, Toyota projected lower consolidated vehicles sales of
8.75 million units for fiscal 2013 ending March 31, 2013, down 50
thousand units from the prior guidance. The automaker also
lowered its consolidated revenues outlook to ¥21.30 trillion (up
14.6% from fiscal 2012) from the prior guidance of ¥22.00
trillion. The downward revision of sales outlook was based on
difficulties in the Chinese and European markets.
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