Toyota’s Daihatsu to halt all vehicle shipments, in widening safety scandal By Reuters

By Daniel Leussink

TOKYO (Reuters) -Toyota Motor’s Daihatsu unit will halt shipments of all of its automobiles, Japan’s largest automaker mentioned on Wednesday, after an investigation into a security scandal discovered points at 64 fashions, together with nearly two dozen offered underneath Toyota (NYSE:)’s model.

An impartial panel has been investigating Daihatsu after it mentioned in April it had rigged side-collision security exams carried out for 88,000 small vehicles, most of these offered as Toyotas.

However the newest revelations recommend the scope of the scandal is much better than beforehand thought and will probably tarnish the automakers’ repute for high quality and security.

Daihatsu is Toyota’s small-car unit and produces a lot of the so-called “kei” smaller vehicles and vehicles which can be in style in Japan. The most recent points additionally impacted some Mazda and Subaru (OTC:) fashions offered within the home market and Toyota and Daihatsu fashions abroad, the panel discovered.

Toyota mentioned “elementary reform” was wanted to revitalise Daihatsu, in addition to a overview of certification operations.

“This might be an especially vital process that can’t be achieved in a single day,” Toyota mentioned in an announcement. “It would require not solely a overview of administration and enterprise operations but in addition a overview of the organisation and construction.”

Toyota shares have been flat on Wednesday afternoon, lagging a 1.6% rise within the broader market.

Daihatsu was discovered to have cheated on security exams of just about all fashions it at present has in manufacturing in addition to some vehicles it made previously, the Asahi newspaper beforehand reported.

The difficulty emerged after Daihatsu mentioned in April it had found the wrongly carried out exams after a whistleblower report. It had reported the difficulty to regulatory companies and halted cargo of affected fashions.

The next month, it mentioned it had stopped gross sales of the Toyota Raize hybrid electrical car and its personal Rocky mannequin after additionally discovering issues with testing for these fashions.

Daihatsu produced 1.1 million automobiles over the primary 10 months of the 12 months, almost 40% of these at abroad websites, in response to Toyota information. It offered some 660,000 automobiles worldwide over that interval and accounted for 7% of Toyota’s gross sales.

Toyota mentioned on Wednesday affected fashions included these for the southeast Asian markets of Thailand, Indonesia, Malaysia, Cambodia and Vietnam and central and South American international locations of Mexico, Ecuador, Peru, Chile, Bolivia and Uruguay.

Daihatsu is the most recent security situation to influence the Toyota group over time.

An engine information scandal at Toyota’s truck- and bus-making unit, Hino Motors, in 2022 led to resignations and non permanent pay cuts for some managers.

In that case Hino admitted to falsifying information on some engines relationship again to 2003, or a minimum of a decade sooner than it initially indicated.

In 2010 Toyota Chairman Akio Toyoda, then chief government, was compelled to testify earlier than U.S. Congress as a consequence of a security disaster involving defective accelerators.