Toyota will pay $17.35 million for delaying a recall of Lexus RX 350 and RX 450h sport-utility vehicles because a floor mat could jam the gas pedal, causing unintended acceleration. It follows a record $48.8 million in fines two years ago, a result of three separate investigations into Toyota's handling ofautorecalls for pedal entrapment, sticky gas pedals and steering relay rod problems.
With the Lexus SUVs, Toyota and its dealers started seeing the problem in 2009, but the automaker failed to issue a recall for the popular vehicles until June, according to the National Highway Traffic Safety Administration.
"Every moment of delay has the potential to lead to deaths or injuries on our nation's highways," said David Strickland, head of the National Highway Traffic Safety Administration.
Federal law requires all auto manufacturers to notify NHTSA within five business days of discovering a safety defect and to promptly issue a recall.
"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," said Ray Tanguay, chief quality officer of Toyota North America.
A fine of $17 million, while large, is hardly a "speed bump" to one of the world's largest automakers, said Jeremy Anwyl, vice chairman at auto information company Edmunds.com.
Regulators are making a statement that automakers need to recall cars even if they are still investigating an issue and determining the proper repair, Anwyl said. Generally, car companies prefer to announce a recall and a fix at the same time.
The latest fine comes as Toyota is regaining lost U.S. market share in the wake of previous fines and larger recalls, as well as inventory problems created by last year's earthquake in Japan.
Through the first 11 months of this year, Toyota has sold almost 1.9 million vehicles in the U.S., up 29% from the same period last year. Its sales are growing at more than twice the rate of the industry. The automaker now has 14.4% of the U.S. market, up from 12.7% through November of last year.
While the fine hurts Toyota's image, it probably will not affect sales, said Thilo Koslowski, the auto analyst at Gartner Inc.
"Consumer memory is just not that long," Koslowski said. "If this is a company that provided subpar vehicles compared to its competitors, this would be a problem. But people like the brand."
Tuesday's fine resulted from an investigation launched earlier this year when NHTSA's Office of Defects Investigation began noticing a trend in floor mat pedal entrapment in 2010 Lexus RX 350s. When safety regulators asked Toyota about the problem in May, the automaker reported 63 alleged incidents of possible floor mat pedal entrapment in RX 350s dating to 2009.
But Toyota waited until June to recall 154,036 Lexus RX 350 and RX 450h vehicles from the 2010 model year.
Toyota has had a history of problems with unintended acceleration. In one high-profile accident, an improperly positioned floor mat in a Lexus sedan may have trapped the accelerator — causing the car to race down California Highway 125 near San Diego at more than 100 mph. The car crashed and burned, killing off-duty California Highway Patrol Officer Mark Saylor and three family members.
That crash led to a safety investigation and recall of 3.8 million Toyota and Lexus vehicles to fix the floor mat problem. After a Los Angeles Times series on unintended sudden acceleration, Toyota issued millions more recall notices to fix sticking gas pedals and other issues. At one point, it had to halt much of its production of new cars in the U.S. to fix recalled vehicles.