Toyota Motors Corp. (TM) has announced yet another round of recalls of its luxury Lexus vehicles. The automaker will recall 4,500 units of its Lexus LS line of vehicles in Japan to fix a computerized steering problem.
The computerized steering system oversees how the steering wheel controls the tires. So far, the company has received 12 complaints related to the problem in its home country, though the problem has not yet caused any accidents.
Toyota may also need to recall another 7,000 affected vehicles of the model that have been exported overseas. They include about 3,800 in the U.S., 150 in Europe and 800 in China, and others in the Middle East, Southeast Asia and Australia.
Last month, Toyota recalled about 10,000 vehicles of its SUV — 2010 Lexus GX 460 — after Consumer Reports magazine revealed that the car bears risks of overturning. The magazine has imposed a “Don’t Buy” rating on GX 460, which was lifted after the recall.
The past recalls have already tarnished the reputation of the automaker. Recently, based on a telephone survey of 1,704 U.S. adult vehicle owners, Consumer Reports suggested that 57% of Toyota owners would “most likely” agree to buy another new vehicle from Toyota. This was down from 70% in a December survey, indicating a downfall in the automaker’s reputation.
So far, the automaker has recalled more than 8.5 million vehicles from around the world related to problems such as faulty accelerator gas pedals, slipping floor mats and defective braking systems. The recall included popular models such as the 2010 Prius hybrid and Toyota Camry.
Toyota has been slapped with dozens of lawsuits due to the recalls. The value of claims under the lawsuits is estimated to reach about $4 billion, reflecting an average loss of $600 per vehicle.
To make matters worse, the U.S. government has imposed its highest-ever fine of $16.4 million on Toyota, accusing it of a deliberate delay in recalling vehicles by hiding its defects even though manufacturers are legally obligated to notify the U.S. safety regulators within 5 business days if they come to know of a safety defect.
To regain consumer confidence, in March Toyota began offering the largest sales incentives in its history. The incentives included zero-percent financing for five years on top-selling models. It has also offered attractive leasing terms and free maintenance for two years for Toyota loyals.
The incentives have pushed Toyota’s sales up 41% to 186,863 vehicles in March and 24.4% to 157,439 vehicles in April. The automaker saw strong sales of even its recalled models, Corolla, Camry and RAV4.
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