Toyota reaches $1.2 billion settlement

It just went from bad, to worse for Toyota. As if the public shame in having to recall millions of vehicles wasn’t bad enough, the company just reached a settlement to end a U.S. criminal probe into the issue. The settlement amount? A whopping $1.2 billion.

The issue is Toyota’s long-standing struggle with unintended acceleration, which led to more than 10 million vehicles being recalled – a truly enormous number – in 2009 and 2010. The probe was, presumably, to figure out if Toyota had made any false disclosures to regulators, for if they had failed to properly listen to driver complaints. Toyota has taken full responsibility following the settlement, with North America chief legal officer Christopher P. Reynolds saying,

At the time of these recalls, we took full responsibility for any concerns our actions may have caused customers, and we rededicated ourselves to earning their trust. In the more than four years since these recalls, we have gone back to basics at Toyota to put our customers first.

This isn’t the only settlement that Toyota has had to reach for the issue. Toyota was hit with myriad lawsuits from owners who claimed that the defect had caused accidents that result in injury or death. The automaker paid roughly $1.6 billion in lawsuit settlements, meaning that the total damage of the recall – not including the cost to fix the issue in 10 million cars – is already at nearly $3 billion.  But Toyota is happy to be putting this all in the rear-view mirror, as Reynolds stated that,

Entering this agreement, while difficult, is a major step toward putting this unfortunate chapter behind us. We remain extremely grateful to our customers who have continued to stand by Toyota. Moving forward, they can be confident that we continue to take our responsibilities to them seriously.

How this negative news impacts Toyota is yet to be seen; their biggest competitor for top sales, General Motors, is currently in the midst of their own crippling recall that is said to be the reason behind at least a dozen driver deaths.

Publicity aside, Toyota can certainly handle their current settlement. It may be a lot of money, but it’s not that much to Toyota, and it’s certainly worth the cost to shut down the investigation and end the negative press.

Photo Credit: Toyota

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