Toyota is extending a recall of millions of its cars to Europe over potential problems with the accelerator pedal, it was announced today.
A spokesman for Toyota Europe, which oversees the firm's operations in Ireland, said it could not say which models would be recalled or how many cars might be involved. "We are working to precisely determine the production periods involved and isolate the cars involved but as yet we don't have a definite answer," he said.
The spokesman said customers concerned about the safety of their car should contact their local dealer and if necessary have the car checked over. He said the problem initially noted with a very small number of cars from the end of 2008 and they were still confident that the number of cars with problems would be extremely limited. Nevertheless, because it might be a potential safety issue it was important to identify and check all the cars that could possibly be involved.
It is the first major recall for Toyota in Ireland since January 2009 when 4,000 Yaris models were recalled over potential problems with seatbelt pretensioners.
In a statement, Toyota said: "There is a possibility that certain accelerator pedal mechanisms may, in rare instances, mechanically stick in a partially depressed position or return slowly to the idle position.
"This is caused because the accelerator pedal mechanisms concerned may become worn. This progressive wear, combined with certain operating and environmental conditions, can cause friction in the mechanism to increase and intermittently result in the accelerator pedal being harder to depress, slow to return or, in the worst case, stick in a partially open position."
It said the driver may notice that the accelerator pedal is progressively harder to depress or is slower to return. A rough or chattered feeling may also be experienced when depressing/releasing the accelerator pedal.
Some analysts suggested as many as two million vehicles could be affected across Europe, while it is expected to affect six million vehicles in the US, where it has suspended the sale of eight of its big-selling models until the problem is rectified.
Today's news follows a major recall in the US of 4.2 million vehicles last autumn, due to floor mats interfering with the pedals. Yesterday it extended this recall to another 1.09 million vehicles.
Toyota has been Ireland's best-selling car brand for the last three years, marketing itself under the tagline "the best-built cars in the world". Internationally, it became the world's largest auto firm in 2007.
The safety issue comes as Toyota grapples with a patchy recovery from a vicious global downturn in the industry and growing competition.
Shares of Toyota fell a further 4 per cent in Tokyo trading today, taking losses since last week to more than 15 per cent and wiping about $25 billion in value from Japan's largest company by market capitalisation.
Analysts said the financial damage to Toyota from the recalls would depend on how long it has to shut production on key models and how badly consumer confidence is shaken as reflected in pricing of both new and used cars.
"The sales and production suspension could cost Toyota at least 50 billion yen ($553 million) in operating profit per month," said Koji Endo, auto analyst at Advanced Research Japan.
Toyota's operating profit in July-September was 58 billion yen. The company had been expected to post an operating loss of around 47 billion yen in the year to March 2010, before rebounding to a 599 billion yen profit in 2011, according to 19 analysts polled by Thomson Reuters I/B/E/S.
Toyota said this week it expects a 6 per cent rise in groupwide global sales to 8.27 million units in 2010, but according to a company spokesman in Tokyo, the outlook does not take this sales suspension into account.
Fitch said it was putting Toyota on watch negative. "The recalls and sales and production suspension cast a negative light on Toyota's reputation for quality, just as the company emerges from an unprecedented downturn in the auto industry," said Jeong Min Pak, senior director in Fitch's Asia-Pacific Corporates team. "This could hamper the company's potential sales and profitability recovery, especially in the US market."
Shares in Asian rivals Honda and Nissan rose 3.3 per cent and 2.8 per cent respectively. South Korea's Hyundai, which beat expectations with a record profit for the fourth quarter, rose 4.1 per cent.
Additional reporting - agencies