Regulators raid Toyota offices over safety scandal, sending shares down
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TOKYO - Toyota Motor shares fell 1.3 per cent after government authorities raided its headquarters on June 4 for defrauding safety certification tests.
A day earlier, the world’s No. 1 carmaker announced the suspension of sales and deliveries for three vehicles
Toyota submitted faulty data during pedestrian-safety tests for three current models – the Corolla Fielder, Corolla Axio and Yaris Cross – and used modified test vehicles during collision-safety tests for four past models, including the Crown, the transport ministry said on June 3.
Toyota was among five carmakers, including Honda and Mazda, found to have falsified or manipulated safety data while applying for certification.
The emerging scandal is “extremely regrettable”, Economy Minister Ken Saito said on June 4 during a news conference, adding that the ministry is investigating the impact on suppliers and will respond appropriately.
The authorities entered Toyota’s headquarters in Nagoya at 9.30am on June 4, according to the ministry.
Ministry officials said they would also conduct on-site inspections of Honda, Mazda, Yamaha and Suzuki.
Toyota said shipment halts will affect two assembly lines responsible for the production of 130,000 units a year. The world’s biggest carmaker made and sold more than 11 million passenger vehicles in 2023.
Meanwhile, Mazda said it fabricated test results and tampered with the units used for collision testing in five models, including the Mazda2 and Roadster RF, according to a statement on June 3. Irregularities were identified in over 150,000 units the automaker has produced since 2014 for the Japanese market.
“We will bear costs incurred to suppliers due to the shipment halts,” Mazda chief executive Masahiro Moro said, adding the company would make efforts to prevent the lapses from recurring. The halt is likely to affect 3,500 orders, and the carmaker is not considering recalls at this point.
Mr Moro attributed the data issues to employee misinterpretations of unclear procedure manuals, not an “organisational cover-up” or “malicious falsification”.
Separately, Honda was found to have fabricated data related to noise and gasoline engine output, affecting more than three million units. Still, customers can continue to use their vehicles, which include the Accord and Odyssey, since they meet legal standards. The automaker did not find any falsification for cars currently being sold, or for upcoming models.
Honda shares fell 2.2 per cent on June 4 and Mazda’s 3.6 per cent.
The findings are the latest blow in a deepening crisis of trust for Japan’s automakers. Earlier in 2024, the transport ministry ordered almost 90 manufacturers to re-examine their testing procedures after decades of fraud were uncovered at a pair of Toyota affiliates.
In December, an internal probe of Daihatsu Motor
The latest probes follow on from a series of scandals involving the likes of Nissan, Mazda and Suzuki stretching back more than a decade, including falsifying emissions and fuel economy data. Airbag maker Takata filed for bankruptcy in 2017 after one of the world’s most famous recall crises.
Vehicle development is more complex now and carmakers are trying to avoid increasing staffing, which could be forcing them to deviate from traditional processes and causing irregularities, according to Bloomberg Intelligence senior auto analyst Tatsuo Yoshida.
Still, he added, these issues are different from the scandal with Daihatsu and its impact on the economy will be limited.
BLOOMBERG
