Toyota extends massive safety recall to Europe

Written by Agencies | Tokyo, Detroit | Updated: Jan 29 2010, 06:02am hrs
Toyota Motor Corp is extending to Europe the recall of millions of its most popular cars due to dangerous accelerator pedals, a further blow to the reputation of the worlds largest car maker.

Toyota said it had not yet determined how many vehicles in Europe would be recalled, or when, but media and analysts have said 2 million cars may be affected on top of some 6 million now recalled in North America.

Meanwhile, shares of Toyota fell a further 4% in Tokyo trading on Thursday, taking losses since last week to more than 15%, wiping about $25 billion in value from Japans largest company by market capitalisation.

The recall and a related sales and production halt in North America of eight models, including its best-selling Camry, have damaged Toyotas once unshakeable record for safety and reliability. It comes as its grapples with a patchy recovery from a vicious global downturn in the industry and growing competition. Toyotas got the resources to bounce back from this, but this is the biggest crisis that they have ever faced, and Ford and Hyundai and others are coming on strong, said Jim Ziegler, an auto dealer consultant in Atlanta.

A Toyota Europe spokeswoman said the models and exact number of potentially affected vehicles was under investigation but there was no need to stop production. Toyota, late on Wednesday, also offered to replace floor mats or pedals on another 1.1 million US vehicles if customers wanted. With that voluntary measure, Toyota would be dealing with nearly 6 million US vehicles for accelerator-related problems across its lineup, a sweeping safety action that has emboldened its rivals.

A further 2 million in Europe would take the total to 8 million, almost the same as its group global sales last year. Cars sold in Japan do not use the parts in question.

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.