Toyota to stop selling, building 57% of its cars
In a stunning and unprecedented move, Toyota Motor Corp. on Tuesday halted sales of most of its popular models in the U.S. in response to growing concerns that possible defects may cause the vehicles to accelerate unintentionally.
The Japanese car maker, which long has been viewed as the leader in automotive quality, said it told its dealers to stop selling eight models, including the Camry and Corolla sedans, two of the biggest sellers in the U.S. market. Other models affected by the move include the RAV4 and Highlander sport-utility vehicles and the Tundra pickup truck.
The eight models represented 57% of Toyota's 2009 U.S. sales. Toyota also said it will stop producing the affected vehicles at several North American plants for one week starting Feb. 1.
Toyota declined to say how long the sales suspension would last. "Absolutely as short as possible," said Mike Michels, a spokesman. "It's not months. We hope to get the remedy finalized, tested and deployed to the dealers as soon as we can," he said.
The sales halt comes after growing reports of accelerator problems with Toyota vehicles. Safety Research and Strategies, a Massachusetts-based safety research firm, has identified 2,274 incidents of sudden unintended acceleration in Toyota vehicles causing 275 crashes and at least 18 fatalities since 1999.
Mr. Michels declined to comment on the numbers. "I would say those data, based on the very diverse nature of his sources, are impossible to verify," he said.
Until recently, Toyota had said it believed the problem mainly stemmed from floor mats getting jammed against the gas pedal, but later said its accelerator assembly's electronics could be a factor as well.
"This is a disaster for Toyota," said Aaron Bragman, an automotive analyst at IHS Global Insight. "It is exactly what Toyota does not need when the market is starting to turn around and people are returning to showrooms. I understand Toyota is trying to go for putting safety before profits. This is such an extreme reaction."
The sales halt also adds to the business troubles Toyota now faces. The deep downturn in U.S. auto sales in the past two years left the company with excess production capacity and idle workers—a situation more familiar to Detroit's Big Three. For the fiscal year ended March 31, 2009, Toyota reported a loss of $4.9 billion, its first loss in 59 years.
The sales halt comes just as the U.S. auto market was showing signs of recovering. More at WSJ.com