Toyota recalls 2.7 million cars, but will its reputation suffer?

Nov 14, 2012

Latest announcement means Toyota has recalled more than 10 million cars this year

TOYOTA is recalling 2.7 million cars worldwide, including nearly 75,000 vehicles in the UK, because of problems with steering and water pump systems.

Models affected include the Toyota Corolla and the second-generation Prius. The faults mean drivers of the affected cars could conceivably lose control of their vehicle.

The flaws have not yet caused any accidents and can be fixed in about an hour, but they will cost the Japanese carmaker up to £500m, Deutsche Securities autos analyst Kurt Sanger told Reuters.

The latest call-back follows last month's recall of 7.43 million vehicles over faulty electric windows which posed a potential fire risk - and comes just after Toyota had reclaimed its crown as the world's biggest carmaker following the 2011 earthquake in Japan and floods in Thailand which hit production hard.

The BBC's Jorn Madslien notes that Toyota's latest announcement pushes the number of recalls this year to more than 10 million - close to the number recalled in 2009 and 2010 over floormat and accelerator pedal issues.

"At that time, Toyota's reputation and sales suffered badly, largely because the problems in question were claimed to be linked to deadly accidents," he says. "This year's recalls are precautionary. There have been no accidents. The consumer response should be less severe."

However, says Madlsien, "Toyota's image as a producer of high quality cars has nevertheless been dented once again."

Koichi Sugimoto of BNP Paribas isn't so sure. "Nobody is perfect," he said. "Vehicles nowadays are very complicated. The company is taking appropriate measures to fix the problems, so I don't think this will cause significant damage to Toyota's reputation."

Sign up for our daily newsletter