Regulators raid Toyota offices over safety scandal, stock falls
TOKYO: Toyota Motor Corp and other carmakers embroiled in a fresh certification scandal halted shipments of a handful of models and saw their offices raided by government officials, but the impact on their customers and operations appears to be limited.

Honda Motor Co shares fell 2.4% while Toyota dipped 1.1% in trading in Tokyo yesterday, after disclosing that they falsified safety certification tests.

Toyota submitted faulty data during pedestrian-safety tests for three current models: the Corolla Fielder, Corolla Axio and Yaris Cross, the transport ministry said on Monday.

The findings follow an earlier order by the government for almost 90 manufacturers to reexamine their testing procedures after decades of fraud were uncovered at a pair of Toyota affiliates last year.

While the disclosures are the latest blow for Toyota and Japan’s automakers, their shares remain up this year.

The latest round didn’t include any cars being recalled or warnings over operational safety.

“Customers can be rest assured their cars are safe to drive, but there are rules we must follow,” Toyota chairman Akio Toyoda told reporters on Monday.

“We should not have sidestepped these important processes.”

Toyota’s three models account for less than 2% of the 11 million vehicles Toyota produced last year.

The shipment halts will affect two assembly lines responsible for the production of 130,000 units a year, according to the carmaker.

Still, Toyoda and his board will need to assuage any concerns about Toyota’s leadership or shared governance at its annual shareholder meeting on June 18.

Two leading proxy firms urged shareholders to vote against the reappointment of Toyoda in the upcoming meeting, citing concerns over the recent scandals, as well as governance issues.

The emerging scandal is “extremely regrettable”, said Economy, Trade and Industry Minister Ken Saito, during a news conference in Tokyo, adding the agency is investigating the impact on suppliers and will respond appropriately.

Authorities entered Toyota’s headquarters in Nagoya yesterday morning, according to the transport ministry.

Officials said they would also conduct on-site inspections of Mazda Motor Corp, Yamaha Motor Co and Suzuki Motor Corp.

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 company statement.

Irregularities were identified in over 150,000 units the automaker has produced since 2014 for the Japan market.

“We will bear the costs incurred to suppliers due to the shipment halts,” Mazda chief executive officer 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.

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 petrol engine output, affecting more than three million units.

Still, Japanese customers can continue to use their vehicles, which include the Accord and Odyssey, since they meet legal standards.

The automaker didn’t find any falsification for cars currently being sold, or for upcoming models. — Bloomberg
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Toyota Motor Corp and other carmakers embroiled in a fresh certification scandal halted shipments of a handful of models and saw their offices raided by government officials, but the impact on their customers and operations appears to be limited.