Toyota recalls 110,000 hybrid cars on safety concerns
- 30 June 2011
- From the section Business
The world's biggest carmaker Toyota is to recall more than 110,000 hybrid vehicles over concerns about a problem with the power supply circuit.
The Japanese carmaker said the recall involves the Highlander hybrid and Lexus RX400h models globally.
The vehicles could stop suddenly because of an electrical problem leading to a blown fuse, the company said in a statement.
Toyota has recalled almost 12 million vehicles in the past 18 months.
The latest recalls are taking place mainly in the US, Japan and Europe, with some in Canada, Australia and South Korea, Toyota said.
The company said it was "working on obtaining the necessary replacement parts" and would get in touch with customers to get their vehicles inspected soon.
"The recalls that we announced cover all known problems regarding the component concerned," Toyota spokesperson Paul Nolasco told the BBC.
"We apologise for the inconvenience caused to our customers and hope to be able [to fix the problem] as soon as possible," he added.
While the recall is likely to raise further questions about Toyota's quality controls, analysts said the carmaker is trying to ensure that it nips the problem in the bud.
"The good news is, they are not allowing it to become a full-blown crisis," said Vivek Vaidya at research group Frost & Sullivan.
He said there had been instances in the past of Toyota saying there were no issues with its vehicles when customers and safety regulators were reporting faults.
He said Toyota was trying to avoid getting into a similar situation again.
Reliability vs. localisation
The recall is the latest in a series of setbacks for Toyota, which has recalled more than 12 million vehicles in the past 18 months.
Analysts say the quest for rapid expansion had led to cracks appearing in the company's quality control system.
As Toyota grew from a Japanese brand to the biggest carmaker in the world, it needed to boost its production in order to meet the increased demand for its cars.
That resulted in the company setting up factories in various parts of the world to ramp up production - factories analysts say may not have been able to maintain Toyota's high standards.
"There might have been seepages in terms of quality standards," said Mr Vaidya.
As a result, its reputation for quality and reliability has taken a hit, especially in America where it was the only major carmaker to see sales fall in 2010.
"They have lost their reputation. There is no point hiding or denying it," Mr Vaidya added.
The problems for Toyota have been compounded further by the earthquake and tsunami in Japan.
Destruction caused by the twin disasters saw the carmaker suspend production, not only at its domestic plants but also at overseas factories.
As a result, earlier this month Toyota warned that its profits for the current financial year would fall by a third.
Analysts said the carmaker is now in danger of losing its position as the world's biggest carmaker.
"According to the various projections that we have, chances are very high that General Motors may regain its number one slot," Mr Vaidya said.
"They are on the up in the US and are doing very well in China and have revamped their line-up in other key markets like India.
"They are the only company that can challenge Toyota."