JEFFREY BROWN: It all started in August with a high-speed crash in California that took four lives, apparently caused when the accelerator pedal of a new Lexus automobile stuck in the car’s floor mats.
In September, after more reports of accidents involving unintended acceleration, Toyota, the world’s largest automaker, announced a recall that has now grown to cover about four million vehicles, including popular brands like the Camry, the top-selling passenger car in America, the Prius, the bestselling gas-electric hybrid, as well as the luxury Lexus model.
The company originally told vehicle owners to remove driver’s-side floor mats. Today, Toyota announced it would have dealers shorten the length of gas pedals immediately and offer replacement pedals beginning next April.
David Shepardson has been covering this story for The Detroit News and joins me now.
DAVID SHEPARDSON: Thanks, Jeff.
JEFFREY BROWN: One horrific accident started this.
DAVID SHEPARDSON: Right.
JEFFREY BROWN: Remind us of that story.
DAVID SHEPARDSON: This was a terrible accident.
On August 28, near San Diego, an off-duty California Highway Patrol officer couldn’t stop the car. His wife called 911. There was a call that lasted less than a minute. They said they were going 120 miles an hour. They started to pray. The car went off an embankment, burst into flames, and four people were killed, including a young child.
JEFFREY BROWN: Now, at the same time, this problem of sudden acceleration, there’s a history to that, right? People have been looking at this problem.
DAVID SHEPARDSON: It’s been a problem for years for lots of automakers.
Is it what — you know, is it just when floor mats get stuck to accelerator pedals or there are other electronic issues that result in it? But there have been hundreds and hundreds of complaints from customers all over the world, really, about this issue.
JEFFREY BROWN: All right, so, in this case, as I said, Toyota first focused on the floor mats. Tell us what they said. And that led to a kind of dispute with the government, I guess.
Government steps in
DAVID SHEPARDSON: Well, this began -- after that accident, a few weeks later, Toyota and the National Highway Traffic Safety Administration issued an urgent warning saying, remove your floor mats immediately to those -- about four million owners.
And, then, you know, in late October, Toyota suggested that perhaps that was it, that the -- the floor mat was the only issue. They said it was a misunderstanding. But then the government responded with an angry press release that said they had been -- they had misled the public. This prompted an apology from Toyota and it prompted the multifaceted fix that we saw today.
JEFFREY BROWN: All right, so explain that fix.
JEFFREY BROWN: I mean, is it clear now what is causingthe problem?
DAVID SHEPARDSON: Well, Toyota believes so. And the government believes as well. They have done an intensive investigation. It's basically three -- they're making three fixes.
Number one, they're replacing the floor mats. They're going to be redesigned, so they're less likely to get stuck to the accelerator pedal. Number two, they are going to immediately start shortening and replacing the accelerator pedals.
So, they're going to take about three-quarters-of-an-inch off the pedal. It makes it smaller, less likely to get stuck in the mat. And, third, starting with some vehicles, they're going to redo the software for a supplemental braking system, which means, if you hit both the accelerator pedal and the brake, it will brake.
JEFFREY BROWN: So, the brake will override the accelerator?
DAVID SHEPARDSON: Exactly.
I mean, the problem is, some customers have reported in lots of different vehicles that, if you -- if it suddenly accelerates and you can't stop, the brake does not work.
JEFFREY BROWN: So, if you're -- if you have one of these cars, the immediate thing to do is take out the floor mat, right, and then go to the dealer?
DAVID SHEPARDSON: Well, you're going to -- you're going to get notified between now -- I'm sorry -- starting in January through June. So, it's going to take a few months for some people to find out.
Initially, they're going to shave off part of that accelerator pedal. And, then, starting in April, they will put a new pedal in. So, you have the option. If they have fixed your pedal temporarily, you can go back and get the other one. But Toyota says each -- either fix should be the same.
JEFFREY BROWN: So, when I asked you what -- do they -- do they know what the cause is... so, the cause is the accelerator pedal getting stuck in the floor mat?
DAVID SHEPARDSON: Right.
JEFFREY BROWN: It's as simple as that, and not more of a computer or electronic problem?
Recall a blemish on reputation
DAVID SHEPARDSON: Well, that what Toyota says. And that's what the government, you know, at this point, it doesn't have any evidence to suggest otherwise.
But there are safety advocates who say it could be a throttle problem or something in the electronic controls. But, today, Toyota was very insistent that it found no evidence that there is an electronic problem.
JEFFREY BROWN: All right. Now, this is a company with a great reputation for quality. So, how does something like this -- what is the thinking, at least, on how something like this happens?
DAVID SHEPARDSON: Well, a couple of things. You know, just this week, they had a recall of 110,000 Toyota Tundras over a rust issue. There were -- there are fears that -- that spare tires could fall off the bottom of vehicles and land on the roadway.
And -- and, look, this is a company that, as you pointed out, is now the world's largest automaker. It's gotten very big. It's opened a lot of plants all over the world. And there are some suggestions that they haven't, you know, maybe done as much in terms of quality as they should. In 2005, they had a big speak in recalls. They sort of redoubled their efforts.
But consider this. In -- last year, Toyota had about 800,000 recalls total. This is 4.2 million, plus the recall from earlier. So, this is by far the most significant recall they have ever had in the U.S.
JEFFREY BROWN: So when you think about the potential hit to its reputation, I mean, that's hard to -- hard to calculate in the short term, I suppose, right
DAVID SHEPARDSON: Well, you know, this is a company that has had some difficulties. I mean, they had their first loss in 50 years. They lost about $4.5 billion.
And, yes, it's the question of, will customers give them another chance? Do they believe that this is endemic of a broader problem, or is this sort of, you know, a stubborn problem with pedals that they vowed to fix? They went beyond what they had to do today. They're even replacing the passenger side mat, so in case a driver mixes them up and puts the wrong mat on the other side, that it won't be a problem.
So, you do have to give Toyota some credit for going above and beyond what they were required to do.
JEFFREY BROWN: So, the hit to the reputation remains to be seen.
What about the hit to the company coffers? How much does something like this cost?
Cost expected to be high
DAVID SHEPARDSON: Well, you can do the math. It's 4.26 million vehicles. I mean, in the Japanese press, they suggest -- suggested it could cost $5 billion. I mean, that's only a little over $100 per vehicle. It probably is in that range somewhere.
Toyota won't say how much it's going to cost. But this is a pretty sizable number, especially when you consider that the company said earlier this year it was going to lose $5 billion this year. They just reduced it to $2 billion, but, still, in the scheme of things, that's a pretty big number.
JEFFREY BROWN: Of course, this is all coming at a time when the economy -- you know, all the -- all the automakers are worried, right?
DAVID SHEPARDSON: Right. Absolutely.
And Toyota did have a bit of good news. They did post a quarterly profit in the most recent quarter. They made about $600 million. So, they have turned the corner, given where they were last year. But, for example, they also got rid of their sponsorship for Formula 1 racing. That's going to save them about $500 million. So, they're taking a lot of steps to -- this isn't the old free-spending days of the auto companies.
JEFFREY BROWN: We just have about 30 seconds. And I'm curious about one thing... because you've been talking about the size of this recall.
DAVID SHEPARDSON: Right.
JEFFREY BROWN: These days, are there more recalls -- or there are fewer... than in the past?
DAVID SHEPARDSON: In 19 -- in 2004, we hit a record of 31 million recalls. Last year, we fell to a near record, just 10 million.
So, we're probably on pace to be in that area again. So, consider four million, that could be close to half of all recalls this year. So, that's a pretty significant number, compared to the rest of the industry.
JEFFREY BROWN: David Shepardson of The Detroit News, thanks a lot.
DAVID SHEPARDSON: Thanks, Jeff.