traffic-safety

GM Recalling 100,000 Crossover Vehicles Over Seat Belt Issue

by AP on December 17, 2010

WASHINGTON — General Motors Co. is recalling about 100,000 crossover vehicles to fix seat belts that could fail in a crash. GM said Friday in a posting with the National Highway Traffic Safety Administration that the recall involves 2011 model year versions of the Cadillac SRX, Chevrolet Equinox and GMC Terrain. The automaker said the seat belt buckle anchor for the driver and front passenger seats could break apart in a crash. GM spokesman Alan Adler said there have been no crashes or injuries reported. GM said it discovered the problem during testing in September. Dealers will modify the seat belt buckles free of charge. The recall is expected to begin in mid-January. Owners can contact Cadillac at (866) 982-2339, Chevrolet at (800) 630-2438 and GMC at (866) 996-9463. They can also consult the GM owner center website at . http://www.gmownercenter.com

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Hyundai Recall: 139,000 Sonata Sedans Recalled For Steering Defect

by AP on September 27, 2010

WASHINGTON — Hyundai Motor Co. said it is voluntarily recalling 139,500 Sonata sedans in the U.S. because of a manufacturing defect that could cause drivers to lose steering control. The recall affects 2011 models built between Dec. 11, 2009 and Sept. 10, the National Highway Traffic Safety Administration noted on its website Sunday. Some of the cars have steering column shafts with connections that may not have been tightened enough or were improperly assembled. As a result, the steering wheel could become separated from the column or a driver could lose the ability to properly steer the car. The U.S. government had opened an investigation into possible steering problems in the vehicle in August. Hyundai, South Korea’s top automaker, has said there have been no related injuries or crashes reported. Owners of affected vehicles can go to their dealers for inspection. Dealers also will update power steering software. Owners may also call NHTSA at 888-327-4236 for more information. The recall comes as automakers ramp up their focus on safety and quality control in the wake of Toyota Motor Corp.’s massive global recall last year over gas pedal and floor mat problems. In February, Hyundai announced a recall of about 47,000 Sonata midsize sedans, mostly sold in South Korea, to replace front door latches following a handful of customer complaints. The company said it had discovered a mechanical problem with the latches which, in rare instances, would not close properly. Earlier this month, Hyundai affiliate Kia Motors said Chung Sung-eun resigned as vice chairman following a global recall of more than 100,000 vehicles due to defective wiring. Of that total, 35,185 vehicles were recalled in the United States. Together, Kia and Hyundai form the world’s fifth-largest automotive group. So far this year, U.S. sales are up 17 percent for Hyundai Motor America, though August sales fell 11 percent from a year-earlier record sparked by federal Cash for Clunkers rebates. The new Sonata has been selling well and nearly doubled its sales numbers to 21,399 in August.

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Honda Recalls 428K Vehicles In North America

August 9, 2010

WASHINGTON — Honda Motor Co. is recalling the popular Accord and Civic passenger cars to address problems with an ignition switch that could allow the key to be removed without the transmission being shifted into park, its third recall over the problem since 2003. Honda said the most recent recall involved 384,220 vehicles and includes 2003 model year Accord and Civics and 2003-2004 versions of the Honda Element. Honda told the National Highway Traffic Safety Administration that the defect with the automatic transmissions could lead to a vehicle rolling away and increase the risk of a crash. The Japanese automaker said in a statement the recall would involve about 197,000 Accords, 117,000 Civics and 69,000 Elements. The company said it has received several complaints about the ignition interlock and “is aware of a small number of related incidents, including one that resulted in a minor injury.” Honda said the ignition interlock mechanism could be damaged or worn during use and “it may become possible to remove the ignition key when the shift lever is not in park.” Unless the parking brake is set, the vehicle could roll away under those circumstances and lead to a crash. The three related recalls have involved about 1.4 million vehicles since 2003. Honda recalled more than 560,000 minivans and sedans, including the 1998-99 Accord, to correct the ignition park-shift interlock defect in October 2003. In January 2005, Honda recalled nearly 490,000 passenger cars, including certain 1999-2002 Accords, because of the ignition switch problem. The latest recall followed an investigation opened by NHTSA in January 2009 after the government received 16 complaints about the failure of the ignition interlock in 2002 and 2003 Accords. Eleven of the complaints alleged that the failure of the interlocks led to rollaway crashes. The recall of the Accord, Civic and Element is expected to begin in late September. Dealers plan to remove an interlock pin and lever within the ignition switch and replace them at no charge. Owners can go to or contact Honda at (800) 999-1009 and select option 4 for more information. http://www.recalls.honda.com

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Steve Parker: Wall Street Journal Reporter Misleads Readers, NPR and Huff Post on Toyota Story

July 29, 2010

Seems we may have been taken in. But we’re in good company, including the Wall Street Journal and National Public Radio. On July 15th, we ran a blog post entitled “Has Toyota Been Right All Along?” reporting that the National Highway Traffic Safety Administration (NHTSA), after downloading data from “black boxes” taken from Toyota-made vehicles whose owners complained about unintended acceleration (UA), said they found a high incidence of driver error and no other recorded problems which caused the UA. This meant, in plain English, that drivers were stepping on their gas pedals when they meant to hit the brakes. And it was our own government’s automotive safety agency saying so. We based our post on a Wall Street Journal article and an interview the author, WSJ reporter Mike Ramsey, did on National Public Radio. The facts, though, according to NHTSA, are different from what this reporter had written. The WSJ reporter cited his information as coming from people within NHTSA who had knowledge of these facts. NHTSA vociferously objected to that possible conjecture, saying Ramsey presented his information as coming from NHTSA, which NHTSA denied. Another NPR reporter who tried to track down Ramsey’s sources before he went on-the-air with NPR wasn’t able to make contact with them. WSJ reporter Ramsey, in the end, was relying on anonymous sources which NPR wasn’t able to verify. Here’s the full story from NPR’s own website: http://www.npr.org/blogs/ombudsman/2010/07/27/128805775/two-ways?ft=1&f=17370252 NPR and the WSJ are usually reliable sources. We apologize for any misunderstanding.

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Flying Car Slated For Sale Next Year

July 1, 2010

WASHINGTON — If cars had wings, they could fly – and that just might happen, beginning next year. The company Terrafugia, based in Woburn, Mass., says it plans to deliver its car-plane, the Transition, to customers by the end of 2011. It recently cleared a major hurdle when the Federal Aviation Administration granted a special weight limit exemption to the Transition. “It’s the next ‘wow’ vehicle,” said Terrafugia vice president Richard Gersh. “Anybody can buy a Ferrari, but as we say, Ferraris don’t fly.” The Transition is a long way from cartoon dad George Jetson’s flying car zooming above traffic, or even the magical Chitty Chitty Bang Bang. “There is no launch button on the (instrument) panel,” Gersh noted. Rather, the car-plane has wings that unfold for flying – a process the company says takes one minute – and fold back up for driving. A runway is still required to takeoff and land. The Transition is being marketed more as a plane that drives than a car that flies, although it is both. The company has been working with FAA to meet aircraft regulations, and with the National Highway Traffic Safety Administration to meet vehicle safety regulations The company is pitching the Transition to private pilots as a more convenient – and cheaper – way to fly. They say it eliminates the hassle trying to find another mode of transportation to get to and from airports: You drive the car to the airport and then you’re good to go. When you land, you fold up the wings and hit the road. There are no expensive hangar fees because you don’t have to store it at an airport – you park it in the garage at home. The plane is designed to fly primarily under 10,000 feet. It has a maximum takeoff weight of 1,430 pounds, including fuel and passengers. Gas mileage on the road is about 30 mpg. Terrafugia says the Transition reduces the potential for an accident by allowing pilots to drive under bad weather instead of flying into marginal conditions. The Transition’s price tag: $194,000. But there may be additional charges for options like a radio, transponder or GPS. Another option is a full-plane parachute. “If you get into a very dire situation, it’s the ultimate safety option,” Gersh said. So far, the company has more than 70 orders with deposits, he said. Terrafugia is Latin for “escape from the land.” The company was founded in 2006 by five Massachusetts Institute of Technology grad students who were also pilots. They received some seed money from the school. The concept of a car-plane has been around since at least the 1950s, but it’s possible that Terrafugia may become the first company to mass-produce one, FAA spokeswoman Laura Brown said. “We’re working very closely with them, but there are still some remaining steps,” Brown said. ___ On the Net: Terrafugia http://www.terrafugia.com/ Federal Aviation Administration http://www.faa.gov

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Flying Car Slated For Sale Next Year

July 1, 2010

WASHINGTON — If cars had wings, they could fly – and that just might happen, beginning next year. The company Terrafugia, based in Woburn, Mass., says it plans to deliver its car-plane, the Transition, to customers by the end of 2011. It recently cleared a major hurdle when the Federal Aviation Administration granted a special weight limit exemption to the Transition. “It’s the next ‘wow’ vehicle,” said Terrafugia vice president Richard Gersh. “Anybody can buy a Ferrari, but as we say, Ferraris don’t fly.” The Transition is a long way from cartoon dad George Jetson’s flying car zooming above traffic, or even the magical Chitty Chitty Bang Bang. “There is no launch button on the (instrument) panel,” Gersh noted. Rather, the car-plane has wings that unfold for flying – a process the company says takes one minute – and fold back up for driving. A runway is still required to takeoff and land. The Transition is being marketed more as a plane that drives than a car that flies, although it is both. The company has been working with FAA to meet aircraft regulations, and with the National Highway Traffic Safety Administration to meet vehicle safety regulations The company is pitching the Transition to private pilots as a more convenient – and cheaper – way to fly. They say it eliminates the hassle trying to find another mode of transportation to get to and from airports: You drive the car to the airport and then you’re good to go. When you land, you fold up the wings and hit the road. There are no expensive hangar fees because you don’t have to store it at an airport – you park it in the garage at home. The plane is designed to fly primarily under 10,000 feet. It has a maximum takeoff weight of 1,430 pounds, including fuel and passengers. Gas mileage on the road is about 30 mpg. Terrafugia says the Transition reduces the potential for an accident by allowing pilots to drive under bad weather instead of flying into marginal conditions. The Transition’s price tag: $194,000. But there may be additional charges for options like a radio, transponder or GPS. Another option is a full-plane parachute. “If you get into a very dire situation, it’s the ultimate safety option,” Gersh said. So far, the company has more than 70 orders with deposits, he said. Terrafugia is Latin for “escape from the land.” The company was founded in 2006 by five Massachusetts Institute of Technology grad students who were also pilots. They received some seed money from the school. The concept of a car-plane has been around since at least the 1950s, but it’s possible that Terrafugia may become the first company to mass-produce one, FAA spokeswoman Laura Brown said. “We’re working very closely with them, but there are still some remaining steps,” Brown said. ___ On the Net: Terrafugia http://www.terrafugia.com/ Federal Aviation Administration http://www.faa.gov

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Flying Car Slated For Sale Next Year

July 1, 2010

WASHINGTON — If cars had wings, they could fly – and that just might happen, beginning next year. The company Terrafugia, based in Woburn, Mass., says it plans to deliver its car-plane, the Transition, to customers by the end of 2011. It recently cleared a major hurdle when the Federal Aviation Administration granted a special weight limit exemption to the Transition. “It’s the next ‘wow’ vehicle,” said Terrafugia vice president Richard Gersh. “Anybody can buy a Ferrari, but as we say, Ferraris don’t fly.” The Transition is a long way from cartoon dad George Jetson’s flying car zooming above traffic, or even the magical Chitty Chitty Bang Bang. “There is no launch button on the (instrument) panel,” Gersh noted. Rather, the car-plane has wings that unfold for flying – a process the company says takes one minute – and fold back up for driving. A runway is still required to takeoff and land. The Transition is being marketed more as a plane that drives than a car that flies, although it is both. The company has been working with FAA to meet aircraft regulations, and with the National Highway Traffic Safety Administration to meet vehicle safety regulations The company is pitching the Transition to private pilots as a more convenient – and cheaper – way to fly. They say it eliminates the hassle trying to find another mode of transportation to get to and from airports: You drive the car to the airport and then you’re good to go. When you land, you fold up the wings and hit the road. There are no expensive hangar fees because you don’t have to store it at an airport – you park it in the garage at home. The plane is designed to fly primarily under 10,000 feet. It has a maximum takeoff weight of 1,430 pounds, including fuel and passengers. Gas mileage on the road is about 30 mpg. Terrafugia says the Transition reduces the potential for an accident by allowing pilots to drive under bad weather instead of flying into marginal conditions. The Transition’s price tag: $194,000. But there may be additional charges for options like a radio, transponder or GPS. Another option is a full-plane parachute. “If you get into a very dire situation, it’s the ultimate safety option,” Gersh said. So far, the company has more than 70 orders with deposits, he said. Terrafugia is Latin for “escape from the land.” The company was founded in 2006 by five Massachusetts Institute of Technology grad students who were also pilots. They received some seed money from the school. The concept of a car-plane has been around since at least the 1950s, but it’s possible that Terrafugia may become the first company to mass-produce one, FAA spokeswoman Laura Brown said. “We’re working very closely with them, but there are still some remaining steps,” Brown said. ___ On the Net: Terrafugia http://www.terrafugia.com/ Federal Aviation Administration http://www.faa.gov

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Toyota Said to Agree to Pay Record $16.4 Million U.S. Fine on Auto Recalls

April 18, 2010

By Angela Greiling Keane and Alan Ohnsman April 19 (Bloomberg) — Toyota Motor Corp. , the world’s biggest carmaker, will agree today to pay a record $16.4 million fine levied by the U.S. Transportation Department, according to an official at the agency. The company, which has recalled more than 8 million vehicles worldwide for defects that may cause unintended acceleration, was fined by the U.S. auto safety regulator for failing to alert the government about circumstances in which gas pedals may stick. The department official asked not to be identified ahead of the announcement. The fine, which amounts to less than 2 percent of Toyota’s projected net income for the year ended March 31, may bolster the case for plaintiffs seeking compensation from the Japanese carmaker. At least 180 consumer and shareholder lawsuits are seeking class-action status and at least 57 individual suits are claiming injuries or deaths caused by sudden acceleration incidents in Toyota vehicles. Paul Nolasco , a Toyota spokesman in Tokyo, declined to comment. The carmaker could have contested the fine, which is the maximum amount the National Highway Traffic Safety Administration can levy. Toyota has 30 days to pay the fine, imposed April 5 by NHTSA. It may be followed by additional penalties because the pedals supplied to Toyota by CTS Corp . “had two separate defects that may require two separate remedies,” the agency told the carmaker in a letter the day it announced the civil penalty. Four-Month Delay Toyota shares fell 2 percent to 3,620 yen as of 1:03 p.m. in Tokyo trading. A recall in January of 2.3 million vehicles involved pedals from CTS, based in Elkhart, Indiana, that were slow to return after being depressed as well as pedals on various vehicles that could become stuck. Manufacturers have five days to report safety defects to NHTSA. The regulator said Toyota waited at least four months before notifying authorities about the defects. The carmaker, based in Toyota City, Japan, failed to share defect information adequately among regional units, company President Akio Toyoda has said. His grandfather founded the company. The U.S. fine might have been as much as $13.8 billion were it not for a statute limiting NHTSA to a civil fine to $16.4 million, the agency said in its letter. That’s based on each of the 2.3 million vehicles involved in the U.S. recall qualifying for a fine of as much as $6,000 each. To contact the reporters on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net ; Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

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Toyota May Face Second U.S. Fine for Failing to Disclose Sticky Gas Pedals

April 9, 2010

By Angela Greiling Keane and Alan Ohnsman April 10 (Bloomberg) — Toyota Motor Corp. may be fined a second time for failing to alert federal regulators that gas pedals might stick and cause unintended acceleration, the U.S. auto-safety regulator said. The National Highway Traffic Safety Administration announced a record $16.4 million civil penalty against Toyota on April 5 for failing to disclose the defect. The agency told Toyota, the world’s largest automaker, in a letter the same day that it may levy an additional fine on the same pedals. Pedals supplied to Toyota by CTS Corp. of Elkhart, Indiana, “had two separate defects that may require two separate remedies,” NHTSA said in the letter obtained yesterday, which cited documents submitted by Toyota. A recall in January of 2.3 million vehicles involved pedals that were slow to return after being depressed as well as pedals on various vehicles that could become stuck. Toyota, based in Toyota City, Japan, has recalled more than 8 million cars and trucks worldwide for two defects that may cause unintended acceleration and to adjust brakes. President Akio Toyoda has said the company his grandfather founded failed to share defect information adequately among regional units. Martha Voss , a Washington-based spokeswoman for Toyota, didn’t immediately respond to a telephone call seeking comment. In the letter, NHTSA Chief Counsel O. Kevin Vincent said Toyota didn’t meet with the regulator until Jan. 19, two days before beginning its U.S. recall of sticky pedals. Toyota knew about defects with sticky pedals in July 2006, according to a timeline dated March 24 that it submitted to NHTSA. Statute’s Limits Were it not for a statute limiting the civil fine announced this week to $16.4 million, Toyota could have faced a potential penalty of as much as $13.8 billion, NHTSA said in the letter. That’s based on each of the 2.3 million vehicles involved in the recall qualifying for a fine of as much as $6,000 each. U.S. Transportation Secretary Ray LaHood said in a statement this week that Toyota “knowingly hid a dangerous defect” by waiting four months to alert regulators to problems involving unintended acceleration and braking. In the April 5 letter to Toyota, NHTSA said an official from the Japanese parent company who wasn’t identified “inexplicably” told the carmaker’s North American engineering unit on Oct. 21, 2009, not to make the same design change to CTS pedals for U.S. vehicles that was already under way for those in Europe. Toyota has yet to provide a detailed response to NHTSA’s assessment and LaHood’s comments. The company has until April 19 to tell regulators whether it will accept or contest the $16.4 million fine. The Detroit Free Press reported the NHTSA letter earlier yesterday. Toyota’s American depositary receipts, each equal to two ordinary shares, rose 44 cents to $79.92 yesterday in New York Stock Exchange composite trading. To contact the reporters on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net ; Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

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Toyota Lengthens Free Maintenance, Extends No-Interest Offer After Recalls

April 6, 2010

By Alan Ohnsman April 6 (Bloomberg) — Toyota Motor Corp. is extending no- interest loans and discount leases for another month on some U.S. models and expanding an offer of two years of free maintenance to hold onto sales gains after record recalls. The incentives include zero-percent financing for as long as five years on 2010 Camry, Avalon, Corolla and Matrix cars; Highlander and RAV4 sport-utility vehicles; and Tundra pickups. All consumers are now eligible for the service plan, not just repeat customers. The deals run until May 3. “We’re extending the two-year complimentary maintenance program, that proved to be very popular with existing Toyota owners in March, to all buyers in April,” Bob Carter , group vice president and general manager of Toyota brand sales, said today in a statement. Toyota is trying to build on momentum in U.S. sales in March, when discount loans and leases helped the world’s biggest automaker boost deliveries 41 percent after two monthly declines. The company has recalled more than 8 million vehicles to adjust brakes and fix flaws linked to sudden acceleration. U.S. Transportation Secretary Ray LaHood said yesterday the National Highway Traffic Safety Administration will seek to fine Toyota a record civil penalty of $16.4 million, the maximum allowed. The Toyota City, Japan-based automaker “knowingly hid a dangerous defect” related to accelerator pedals that can stick, LaHood said. All standard service will be covered for two years under the new maintenance plan, Sona Iliffe-Moon , a spokeswoman, said in an e-mail. Customers also can choose a $3,000 rebate on Avalon rather than the loan, according to Toyota’s Web site . Toyota initially announced incentives on March 2, and those offers expired yesterday. Toyota’s U.S. sales unit is based in Torrance, California. The company’s American depositary receipts rose 4 cents to $81.30 at 12:03 p.m. in New York Stock Exchange composite trading. To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

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Toyota Faces Record $16.4 Million U.S. Fine for Hiding Accelerator Defect

April 5, 2010

By Angela Greiling Keane April 5 (Bloomberg) — Toyota Motor Corp. may face the maximum civil penalty of $16.4 million from the U.S. because it “knowingly hid a dangerous defect” that caused sudden acceleration, Transportation Secretary Ray LaHood said. Toyota, the world’s largest automaker, waited at least four months before it told the National Highway Traffic Safety Administration about vehicle accelerator pedals that may stick, LaHood said today in an e-mailed statement. “We now have proof that Toyota failed to live up to its legal obligations,” LaHood said in the statement. “Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families.” The fine would be the largest civil penalty assessed by the auto safety regulator against an automaker. Toyota, based in Toyota City, Japan, in January recalled about 2.3 million cars and trucks for sticky accelerator pedals. The company has recalled more than 8 million vehicles worldwide for flaws that may cause unintended acceleration. To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net .

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Honda Recalls 410,000 Vehicles Over Faulty Brake System

March 16, 2010

Honda has recalled more than 400,000 vehicles over concerns of brake failure, according to several news reports today. While Honda’s announcement pales in comparison to Toyota’s recall of 8.5 million vehicles , its part of a growing number of automaker concerns about the possibility of faulty brake systems. Here’s the AP: The recall includes 344,000 Odysseys and 68,000 Elements from the 2007 and 2008 model years. Honda said in a statement that over time, brake pedals can feel “soft” and must be pressed closer to the floor to stop the vehicles. Left unrepaired, the problem could cause loss of braking power and possibly a crash, Honda spokesman Chris Martin said. “It’s definitely not operating the way it should, and it’s safety systems, so it brings it to the recall status,” he said. The National Highway Traffic Safety Administration has reported three crashes due to the problem with minor injuries and no deaths, Martin said. Honda notified NHTSA of the recall on Monday, he said. The problems with uncontrolled acceleration acceleration seem to not be limited to Toyota. As Bloomberg noted yesterday , American automakers may also have had brake issues. Here’s Bloomberg: U.S. regulators have tracked more deaths in vehicles made by Ford Motor Co., Chrysler Group LLC and other companies combined than by Toyota Motor Corp. during three decades of unintended acceleration reviews that often blamed human error. The agency received 15,174 complaints involving unintended acceleration in the past decade and has run 141 investigations of the phenomenon since 1980, closing 112 of them without corrective action. NHTSA’s repeated conclusion that crashes occurred because drivers mistakenly stomped the accelerator became a policy position that caused investigators to take complaints of runaway vehicles less seriously than they should have, safety advocates say. Here’s more from the AP: Drivers who fear that they’ve lost braking power should have their dealer check the brakes sooner, Martin said. The dealer can “bleed” air bubbles out of the hydraulic lines, which should fix the problem until the parts arrive for the final repair, he said. Honda technicians will put plastic caps and sealant over two small holes in the device to stop the air from getting in, Martin said. The automaker is still preparing a list of affected vehicles. After April 19, owners can determine if their vehicles are being recalled by going to or by calling (800) 999-1009, and selecting option number four. http://www.recalls.honda.com

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Toyota Autos’ Sudden Acceleration Tied to 43 Crashes, 52 Deaths, U.S. Says

March 2, 2010

By Angela Greiling Keane March 2 (Bloomberg) — The U.S. National Highway Traffic Safety Administration has received reports of 43 fatal crashes involving sudden unintended acceleration in Toyota Motor Corp. vehicles since 2000. The crashes caused a total of 52 deaths and 38 injuries, the agency said today in an e-mailed statement on data through last month. The agency provided the information to the Senate Commerce, Science and Transportation Committee , which is holding a hearing today on Toyota’s record recalls. Thirty three of the crashes, causing 41 deaths, were in vehicles with electronic throttle controls. NHTSA is investigating whether electronic systems contributed to the incidents, while Toyota has said there is no evidence of a connection. To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

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General Motors to Recall 1.3 Million Compact Cars to Fix Power Steering

March 1, 2010

By Jeran Wittenstein March 1 (Bloomberg) — General Motors Co. plans to recall 1.3 million Chevrolet and Pontiac vehicles in North America to fix power steering systems, after the U.S. started an investigation spurred by consumer complaints. GM will replace a motor in the power steering system of Chevrolet Cobalt small cars and three Pontiac models after more than 1,100 complaints cited a loss of power-steering assist. The defect was linked to 14 crashes and one injury, the company said in an e-mailed statement. The Detroit-based carmaker told the National Highway Traffic Safety Administration about the recall today, the statement said. The action follows global recalls of more than 8 million vehicles by Toyota Motor Corp. for problems including unintended acceleration, which have prompted lawsuits and Congressional hearings. The cases have triggered a review of the NHTSA by the U.S. Transportation Department’s inspector general to examine the way government investigators monitor automotive defects. “Recalling these vehicles is the right thing to do,” Jamie Hresko, a vice president for quality at GM, said in the statement. The steering problem tends to occur in older vehicles for which the warranties have expired, he said. The vehicles covered are the 2005-2010 Cobalt, 2007-2010 Pontiac G5, 2005-2006 Pontiac Pursuit sold in Canada, and the 2005-2006 Pontiac G4 sold in Mexico. A remedy is being developed and customers will be notified when the plan is completed, the statement said. The vehicles can still be steered when the power steering system fails, although it requires greater effort, Hresko said. The NHTSA said Feb. 1 it was investigating the Cobalt because of reports of “sudden loss” of power steering. GM reported U.S. sales of 104,724 Cobalts last year, a decline of 44 percent from 2008. The automaker said in January it plans to build fewer of the cars through April as it adjusts output to match demand. To contact the reporter on this story: Jeran Wittenstein at jwittenstei1@bloomberg.net

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General Motors to Recall 1.3 Million Compact Cars to Fix Power Steering

March 1, 2010

By Jeran Wittenstein March 1 (Bloomberg) — General Motors Co. plans to recall 1.3 million Chevrolet and Pontiac vehicles in North America to fix power steering systems, after the U.S. started an investigation spurred by consumer complaints. GM will replace a motor in the power steering system of Chevrolet Cobalt small cars and three Pontiac models after more than 1,100 complaints cited a loss of power-steering assist. The defect was linked to 14 crashes and one injury, the company said in an e-mailed statement. The Detroit-based carmaker told the National Highway Traffic Safety Administration about the recall today, the statement said. The action follows global recalls of more than 8 million vehicles by Toyota Motor Corp. for problems including unintended acceleration, which have prompted lawsuits and Congressional hearings. The cases have triggered a review of the NHTSA by the U.S. Transportation Department’s inspector general to examine the way government investigators monitor automotive defects. “Recalling these vehicles is the right thing to do,” Jamie Hresko, a vice president for quality at GM, said in the statement. The steering problem tends to occur in older vehicles for which the warranties have expired, he said. The vehicles covered are the 2005-2010 Cobalt, 2007-2010 Pontiac G5, 2005-2006 Pontiac Pursuit sold in Canada, and the 2005-2006 Pontiac G4 sold in Mexico. A remedy is being developed and customers will be notified when the plan is completed, the statement said. The vehicles can still be steered when the power steering system fails, although it requires greater effort, Hresko said. The NHTSA said Feb. 1 it was investigating the Cobalt because of reports of “sudden loss” of power steering. GM reported U.S. sales of 104,724 Cobalts last year, a decline of 44 percent from 2008. The automaker said in January it plans to build fewer of the cars through April as it adjusts output to match demand. To contact the reporter on this story: Jeran Wittenstein at jwittenstei1@bloomberg.net

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Toyota’s `Pattern of Hiding’ to Be Probed in Hearing on Recalls, Issa Says

February 19, 2010

By Jeff Plungis and Lizzie O’Leary Feb. 19 (Bloomberg) — Toyota Motor Corp .’s “pattern of hiding” will be examined at a congressional hearing next week on safety recalls by the world’s largest automaker, U.S. Representative Darrell Issa said today. Toyota said yesterday that President Akio Toyoda will testify at the Feb. 24 hearing of the House Oversight and Government Reform Committee . That’s important because “he’s the only person that can speak for a global enterprise” about “getting those problems addressed quickly,” Issa, the panel’s senior Republican, said in a Bloomberg Television interview. The panel will also examine the failure of the National Highway Traffic Safety Administration to use its legal authority to force recalls, said Issa. Regulators should be looking more globally for potential defects, the California lawmaker said. Issa said he hoped the hearings wouldn’t lead to new auto- safety legislation. “I want them to use the power they have,” Issa said of NHTSA. Toyota, the world’s biggest automaker , is fixing more than 8 million vehicles worldwide for defects including unintended acceleration, and faces an investigation on a possible steering flaw on its Corolla sedan, the world’s top-selling car. To contact the reporter on this story: Jeff Plungis in Washington at jplungis@bloomberg.net ; Lizzie O’Leary in Washington at loleary2@bloomberg.net ;

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Video: Issa Says Hearing to Probe Toyota’s `Pattern of Hiding’: Video

February 19, 2010

Feb. 19 (Bloomberg) — U.S. Representative Darrell Issa, a Republican from California, talks with Bloomberg’s Lizzie O’Leary about a planned congressional hearing into Toyota Motor Corp.’s safety recalls. Issa, speaking in Washington, also discusses Toyota President Akio Toyoda’s decision to testify at the hearings and the performance of the National Highway Traffic Safety Administration. (Source: Bloomberg)

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Toyota Sales Executive Plans Feb. 1 U.S. Television Appearances on Recall

January 31, 2010

By Alan Ohnsman Jan. 31 (Bloomberg) — Toyota Motor Corp. ’s head of U.S. sales plans to make U.S. television appearances on Feb. 1, starting with NBC Universal’s “Today Show,” as the world’s largest automaker races to resolve its biggest recall crisis. Jim Lentz , president of Torrance, California-based Toyota Motor Sales USA, is to speak on the NBC program before holding a conference call with other news organizations, said a company official who declined to be identified because the plan isn’t public. Lentz may also appear on Bloomberg Television on Feb. 1. The automaker this month recalled 2.3 million vehicles in the U.S. over a pedal defect linked to sudden acceleration. That action, coinciding with other sudden acceleration-related recalls of about 5.4 million vehicles, led to the halting of U.S. sales and North American production of eight models and prompted Congress to schedule hearings on the matter. “We believe we are close to announcing an effective remedy,” the company said in an advertisement in more than 20 U.S. newspapers today. Akio Toyoda , president of the Toyota City, Japan-based company, has apologized for the widening defects crisis. “I am deeply sorry that we’re giving cause for concern to customers,” Toyoda said in an unscheduled interview on Jan. 29 with Japan’s NHK television network in Davos, Switzerland, posted to U.S. broadcaster ABC News’ Web site . “We’re preparing to explain the facts to our customers as soon as we can so that we can remove that anxiety.” The U.S. government didn’t balk at Toyota’s approach during a meeting last week, according to a Transportation Department official, who declined to be identified discussing the session with company representatives. The department’s National Highway Traffic Safety Administration , which oversees recalls, doesn’t formally approve specific remedies, the official said. To contact the reporters on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

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BMW’s 7-Series Sedan With Six-Cylinder Engine Points to Mileage Over Macho

January 15, 2010

By Mike Ramsey and Doron Levin Jan. 15 (Bloomberg) — Bayerische Motoren Werke AG will sell a 7-series sedan in the U.S. with a six-cylinder engine for the first time in 18 years as the industry’s push for better fuel economy reaches the top end of the luxury category. Four-cylinder engines also will return in smaller models after a hiatus dating to 1999, Munich-based BMW said this week at the North American International Auto Show in Detroit. The shift is a response to the Obama administration’s 2009 mileage rules. For BMW, the world’s largest maker of luxury autos, the challenge in the 7-Series is convincing buyers that turbocharged six-cylinder engines will be close enough to V-8 performance to justify prices exceeding $70,000. “Downsizing the engines with boosting is what has to happen,” said Aaron Bragman , an analyst at IHS Global Insight Inc. in Troy, Michigan. “This is more about regulation than customers’ desire for fuel efficiency.” General Motors Co. and Hyundai Motor Co. also used the auto show to display new mid-sized cars with only four-cylinder engines to help meet the new mileage standards, which call for having average fuel economy of 35.5 miles per gallon by 2016. Keeping Horsepower Turbochargers, better transmissions and fuel-injection technology will help automakers maintain horsepower, said Chris Meagher, the chief engineer for Detroit-based GM’s Ecotec four- cylinder engines. BMW’s cars and light trucks averaged 27.5 mpg and 23.1 mpg in 2009, according to the National Highway Traffic Safety Administration . “We have heard customers asking for a wider range of options to balance individual demands and concerns for increased efficiency and lower CO2, and if they were going to stay with BMW they want the same performance they always expected,” said Jim O’Donnell , chief executive officer of BMW U.S. Holding Corp., which is based in Woodcliff Lake, New Jersey. Competitors for the 7-Series such as the A8 from Volkswagen AG ’s Audi and the S-Class from Daimler AG’s Mercedes-Benz don’t have gasoline-only six-cylinder options. Daimler sells a six- cylinder S-Class hybrid, according to the Mercedes-Benz Web site. BMW’s new 740i , which will start at $71,025 when it reaches dealers this year, will put out 315 horsepower with the aid of twin turbochargers, according to the company. That’s 44 percent more than the last six-cylinder 7-Series, a 735i sold in 1992. Top of Line The 7-Series is BMW’s top-of-the-line model in the U.S., according to the automaker’s Web site. The car will still be offered with V-8 and V-12 engines, BMW said. While the new 740i hasn’t been rated by the Environmental Protection Agency , its fuel economy will be more than a 10 percent improvement over the V-8 750i, which gets 22 mpg, according to BMW. BMW’s last four-cylinder U.S. car was a 3-Series in 1999. The smaller engine will return in new vehicles debuting in the next three years, Tom Kowaleski , a spokesman, said yesterday, while declining to specify the models. Acceptance of four-cylinder engines is growing. In 2009, 62 percent of all cars built for the U.S. market had such an engine, the highest share on record, according to researcher Paul Zajac at Ward’s Automotive Group in Southfield, Michigan. A new four-cylinder Sonata, Hyundai’s highest-volume U.S. model, went on display this week at the Detroit auto show. In its base configuration, it will turn out 198 horsepower and get 35 mpg on the highway, according to the Seoul-based company. The car arrives in showrooms next month. Hyundai, GM “The best way to cost-effectively improve our industry’s fuel economy right now isn’t through hybridization,” said Chris Hosford , a Hyundai spokesman. “It’s through the rapid introduction of four-cylinder engines.” GM’s Buick Regal , a new sedan due to go on sale this year, will only be offered with four-cylinder engines. A version with a turbocharged 2-liter engine will produce 220 horsepower, topping the 205 horsepower from the 5.7-liter V-8 in GM’s 1984 Chevrolet Corvette sports car, according to the company . “In the mid-sized segment, fuel economy is a key driver of consideration,” said Craig Bierley, product marketing director for Buick. “Being able to deliver a four-cylinder that could give very, very acceptable performance is important for us.” To contact the reporters on this story: Mike Ramsey in Detroit mramsey6@bloomberg.net ; Doron Levin in Detroit at dlevin5@bloomberg.net

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Obama Administration To Triple Workers In Cash For Clunkers: AP

August 17, 2009

WASHINGTON — The Obama administration is tripling the number of workers processing Cash for Clunkers transactions as some dealers complain the government has been slow to reimburse them for the car incentives of up to $4,500 per vehicle. An administration official said Monday the Transportation Department hoped to have 1,100 public and private sector workers processing the vouchers by the end of the week, up from a work force of about 350 through the end of last week. Employees at a department service center in Oklahoma City have taken the lead in processing the vouchers, the official said, and workers have responded to calls for voluntary overtime to process the forms. The official was not authorized to discuss the work force issues publicly and spoke on the condition of anonymity. Dealers have reported submitting tens of thousands of dollars – in some cases more – worth of rebates to the federal government for repayment that are still outstanding. Many report they have been repaid for only a small fraction of the deals they made under the program, creating strain on cash flows at dealers nationwide. Rick DeSilva, who owns Hyundai and Subaru dealerships in northern New Jersey, said an inspector from the National Highway Traffic Safety Administration, which is overseeing the program, visited his offices Monday to review his dealerships’ paperwork. Until now, none of the 70 Cash for Clunkers deals DeSilva made have been reimbursed. “Every car that goes out, you are $4,000 behind the 8-ball,” said DeSilva, who is still owed about $280,000. The National Automobile Dealers Association applauded the boost in staff reviewing the dealer claims. “Anything that will speed up the dealer reimbursement process is welcome news,” NADA spokesman Charles Cyrill said. The government said Monday that dealers have submitted requests for rebates that total $1.6 billion – more than half of the money provided to the program – through the online system set up to process and pay the claims. The program has led to more than 390,000 vehicle sales. Rep. Joe Sestak, D-Pa., who is challenging Pennsylvania Sen. Arlen Specter in the state’s Democratic primary, urged President Barack Obama to increase staffing levels in a letter Sunday. Sestak wrote that many dealers face a loss on each transaction until the government reimburses them. “Carrying a loss for an extended period will put them out of business – meaning more lost jobs,” Sestak wrote. With the increased staffing, the government’s work force is much larger than originally anticipated. A week before Cash for Clunkers formally began July 27, NHTSA estimated it would need just 30 new hires and 200 contractor workers to handle the program over a six month period, according to the guidelines drafted by the agency. But dealers flooded the online reimbursement system shortly after the program began, overwhelming the computer system and staff set up to process the deals. That led to big delays for dealers trying to file the paperwork they needed to get paid back for the rebates. Under the program, car buyers are eligible for vouchers of $3,500 or $4,500 depending on the fuel efficiency of the vehicles they trade in and buy. Dealers subtract the rebate from the sales price, and then submit paperwork to the government certifying the sale with the assurance that the trade-in will be scrapped. NHTSA has told dealers they can expect to wait 10 days to be repaid if their paperwork is in order and the deal is approved. But if there is a problem, dealers must resubmit their claim, leading to another potential waiting period. Dealers typically borrow money to put new cars on their lots and must repay lenders within a few days of a sale. Government officials have said some of the submitted paperwork has been incomplete or inaccurate, leading to delays.

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`Clunkers’ Program Too Slow to Reimburse U.S. Auto Dealers, Lawmaker Says

August 17, 2009

By Angela Greiling Keane Aug. 17 (Bloomberg) — The U.S. “cash for clunkers” trade-in program has reimbursed auto dealers for only 2 percent of their claims, adding to strain on retailers trying to recover from a slump in vehicle sales, Representative Joe Sestak said. The clunkers plan offers auto buyers vouchers of as much as $4,500 to trade in older cars and trucks for new, more fuel- efficient vehicles. Participating retailers are to be paid back by the U.S. on valid deals under the initiative. The plan is “unintentionally failing to meet its obligations due to mismanagement,” with four out of five applications rejected for minor oversight, Sestak, a Pennsylvania Democrat, said in an Aug. 15 letter to President Barack Obama . Sestak urged the National Highway Traffic Safety Administration to increase the number of claims processors to 1,000 from 225 currently. Most dealers “face a loss on each transaction until the government delivers their reimbursement,” Sestak said in the letter. “For auto dealers who have seen their capital reserves decline in recent months through no fault of their own, carrying a loss for an extended period will put them out of business — meaning more jobs.” The Transportation Department is holding meetings with dealers and their associations to emphasize the importance of submitting complete applications and avoiding mistakes, Sasha Johnson , a spokeswoman at the agency, said in an e-mailed statement. The information is required under law to make sure the U.S. provides money only for legitimate transactions, she said. “The Department of Transportation is committing enormous resources and working overtime to process the overwhelming volume of applications both quickly and responsibly while getting rebates paid for complete and valid deals,” Johnson said. To contact the reporters on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

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Cash For Clunkers: What You Need To Know

July 24, 2009

WASHINGTON — Got an old gas guzzler in the garage? Car shoppers can take advantage of new government incentives worth $3,500 to $4,500. Owners can scrap their clunker in exchange for a new, more fuel-efficient vehicle, and lop off thousands of dollars from the sticker price

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