Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Coronavirus Pandemic UK and US Second Waves, and the Influenza Doomsday Scenario - 8th Jul 20
States “On the Cusp of Losing Control” and the Impact on the Economy - 8th Jul 20
Gold During Covid-19 Pandemic and Beyond - 8th Jul 20
UK Holidays 2020 - Driving on Cornwall's Narrow Roads to Bude Caravan Holiday Resort - 8th Jul 20
Five Reasons Covid Will Change SEO - 8th Jul 20
What Makes Internet Packages Different? - 8th Jul 20
Saudi Arabia Eyes Total Dominance In Oil And Gas Markets - 7th Jul 20
These Are the Times That Call for Gold - 7th Jul 20
A Reason to be "Extra-Attentive" to Stock Market Sentiment Measures - 7th Jul 20
The Beatings Will Continue Until the Economy Improves - 6th Jul 20
The Corona Economic Depression Is Here - 6th Jul 20
Stock Market Short-term Peaking - 6th Jul 20
Gold’s Major Reversal to Create the “Handle” - 5th July 20
Gold Market Manipulation And The Federal Reserve - 5th July 20
Overclockers UK Custom Build PC Review - 1. Ordering / Stock Issues - 5th July 20
How to Bond With Your Budgie / Parakeet With Morning Song and Dance - 5th July 20
Silver Price Trend Forecast Summer 2020 - 3rd Jul 20
Silver Market Is at a Critical Juncture - 3rd Jul 20
Gold Stocks Breakout Not Confirmed Yet - 3rd Jul 20
Coronavirus Strikes Back. But Force Is Strong With Gold - 3rd Jul 20
Stock Market Russell 2000 Gaps Present Real Targets - 3rd Jul 20
Johnson & Johnson (JNJ) Big Pharma Stock for Machine Learning Life Extension Investing - 2nd Jul 20
All Eyes on Markets to Get a Refreshed Outlook - 2nd Jul 20
The Darkening Clouds on the Stock Market S&P 500 Horizon - 2nd Jul 20
US Fourth Turning Reaches Boiling Point as America Bends its Knee - 2nd Jul 20
After 2nd Quarter Economic Carnage, the Quest for Philippine Recovery - 2nd Jul 20
Gold Completes Another Washout Rotation – Here We Go - 2nd Jul 20
Roosevelt 2.0 and ‘here, hold my beer' - 2nd Jul 20
U.S. Dollar: When Almost Everyone Is Bearish... - 1st Jul 20
Politicians Prepare New Money Drops as US Dollar Weakens - 1st Jul 20
Gold Stocks Still Undervalued - 1st Jul 20
High Premiums in Physical Gold Market: Scam or Supply Crisis? - 1st Jul 20
US Stock Markets Enter Parabolic Price Move - 1st Jul 20
In The Year 2025 If Fiat Currency Can Survive - 30th Jun 20
Gold Likes the IMF Predicting a Deeper Recession - 30th Jun 20
Silver Is Still Cheap For Now - 30th Jun 20
More Stock Market Selling Ahead - 30th Jun 20
Trending Ecommerce Sites in 2020 - 30th Jun 20
Stock Market S&P 500 Approaching the Precipice - 29th Jun 20
APPLE Tech Stock for Investing to Profit from the Machine Learning Mega trend - 29th Jun 20
Student / Gamer Custom System Build June 2020 Proving Impossible - Overclockers UK - 29th Jun 20
US Dollar with Ney and Gann Angles - 29th Jun 20
Europe's Banking Sector: When (and Why) the Rout Really Began - 29th Jun 20
Will People Accept Rampant Inflation? Hell, No! - 29th Jun 20
Gold & Silver Begin The Move To New All-Time Highs - 29th Jun 20
US Stock Market Enters Parabolic Price Move – Be Prepared - 29th Jun 20
Meet BlackRock, the New Great Vampire Squid - 28th Jun 20
Stock Market S&P 500 Approaching a Defining Moment - 28th Jun 20

Market Oracle FREE Newsletter

AI Stocks 2020-2035 15 Year Trend Forecast

Toyota's Troubles Double as China Threatens Action

Companies / Corporate News Sep 22, 2010 - 11:13 AM GMT

By: Pravda

Companies

Best Financial Markets Analysis ArticleMisfortunes of Japanese automaker Toyota Motor Corp continue. Chinese authorities are threatening to fine the group for bribing dealers. The company, providing cheap loans to three of its dealers, forced them to issue loans to buyers not through the banks of the country, but directly through Toyota. The amount of the fine is 140 thousand Yuan ($20 thousand 650). Damages will amount to 426.3 thousand Yuan ($65 thousand 500).


According to Chinese authorities, a formal decision on penalties will come into force within three working days if Toyota fails to file a request for rehearing on this issue. Meanwhile, the company denies any such allegations and claims that no notification from Beijing on the penalty has been received, The Associated Press reports.

The investigation regarding the financial department of Japanese automotive corporation in China, Toyota Motor Finance (China), was initiated by the Administration for Industry and Commerce of Hangzhou in Zhejiang Province.

According to authorities, in the period from August 2008 to April 2010, the Japanese manufacturer was in collusion with the three dealers who forced customers to take out loans for cars only from the company, not allowing loans from local banks. However, as the Chinese side found out, the annual interest on loans of the Japanese manufacturer is 10-12%, which is significantly higher than those offered by Chinese banks (less than 7%).

As a reward for attracting buyers to the non-advantageous loans, Toyota dealers shared 4.5% of credit earnings with the dealers. In total, Toyota Motor Finance (China) fraudulently earned over 426 thousand Yuan (over $63 thousand).

The agency report stated that the authorities intend to return all illegal income, and fine the company for 140 thousand Yuan ($20.8 thousand). In addition, a similar investigation is conducted in the financial departments of Japanese companies in other cities in China.

This news instantly reflected on the value of Toyota shares. The automaker's shares are currently losing approximately 2.99% in trading in Tokyo.

Toyota's bad luck started last year, when it recalled 3.8 million Lexus cars (model ES 350, IS 250 and IS 350) and Toyota (Camry, Avalon, Prius, Tacoma, Tundra) in the U.S. due to the fact that sliding mat blocked the gas pedal.

In late January, Toyota announced that the gas pedal may stick in 2.3 million cars, and no longer because of the mats. At this time, the cause was a defective accelerator drive, which eventually becomes difficult to push; it rotates slowly to its original position or, at worst, gets stuck in the pushed down position. As a result, the list of recallable models included three models from the last recall (Avalon, Camry and Tundra) and five new models - Toyota RAV4, Corolla, Matrix, Highlander and Sequoia.

Accelerator drive is not the only problem with Toyota. In November, the company recalled 110 thousand Tundra pickups in the United States because of a possible malfunction of spare wheels mounting. In July, the automaker announced the recall of 71 thousand cars because of malfunction in the transmission. In August of this year, Toyota announced a recall of over 95 thousand cars of the three models in the U.S. due to a possible failure of the braking system.

The total number of vehicles recalled by Toyota Motor in the U.S. and European markets due to defects in the gas pedal is nearly 9 million cars. This figure exceeds the annual sales in recent years, which in 2009 totaled 7.81 million, and in 2008 - 8.97 million vehicles.

In this case, the story of the massive recall is ongoing. Recently, Japanese engineers group said they found a fault in the "black boxes" of the cars suspected of spontaneous acceleration.

During the tests of "defective" vehicles Toyota engineers suspected that a device that records the speed of cars was not working properly. For example, the "black box" of one of the crashed pickup Tundra recorded the speed of 274 km / h, which, according to the Japanese, is not physically possible. The observed failure of the program means that not all Toyota cars that have been recalled really spontaneously accelerated.

The latest model recalled by the Japanese company is Pickup Hilux, totaling over 116,000 units. Reason for the recall is towing lugs, which periodically break down, especially on roads with frequent alternates between braking and acceleration.

It is worth noting that the automaker's losses are not limited with repair expenses. In March of 2010, Ministry of Transport of the United States demanded that the leadership of Toyota submits for review all documents relating to the mass recall of cars in the United States to see how quickly the company responded to the identified defects in their vehicles.

As a result, the Ministry of Transport found that Toyota knew about the gas pedal issue no later than September 29, 2009, and alerted the European consumers about the possible problems. However, in the U.S., the company announced the recall of vehicles only in January of 2010. Thus, the company delayed providing this information to the authorities for over four months.

In early April of 2010, the U.S. federal government has imposed penalties in the amount of $16,347,000 on the Japanese automaker Toyota Motor Corp for the fact that it delayed the official announcement of the problems associated with a defect of the accelerator pedal in the US. This is the maximum possible amount of penalty in the U.S. and the highest sanctions ever applied by the Government to automakers.

However, the Japanese automaker does not despair. By the end of 2012, Toyota plans to launch six new hybrid cars and electric cars, which will initially be available only in the North American market.

Earlier, Toyota lagged behind competitors such as Nissan Motor Co and General Motors Co in the number of electric and hybrid models. However, the new plans of the company show that the largest automaker plans to win back the backlog, which was partially caused by the recall of cars due to safety concerns.

Toyota Motor is one of the world's largest automakers. Moscow office of Toyota Motor was established in 1998. Net profit of the group in the first quarter of 2010-2011 fiscal year amounted to 190.47 billion yen (2.21 billion dollars) against losses of 77.82 billion yen a year earlier.

Ekatherina Evstigneeva

Pravda.ru

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Pravda Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules