Disaster Debris Wide-Area Disposal: Toyota Eager to Help at Its Factory Site in Aichi Prefecture on a Landfill

Toyota's Tahara Factory in Tahara City, Aichi Prefecture makes Lexus. The factory is on a landfill on Mikawa Bay, and the company says there is a plenty of space for Tohoku disaster debris.

Mainichi Shinbun (4/5/2012) reports:

震災で発生したがれき処理で、トヨタ自動車が愛知県から打診されていた同社田原工場（同県田原市）敷地内での最終処分場建設を受け入れる方向で検討に入ったことが５日、明らかになった。周辺住民や工場従業員への影響を調査し、周辺住民や自治体の同意が得られれば、県と具体的な協議に入る方針。

It has been revealed that Toyota has started the internal discussion to agree to the request from the Aichi prefectural government to build a final disposal site on its factory compound in Tahara City. The company will study the effect on the nearby residents and the factory workers, and once the consent from the residents and the local municipality (Tahara City) is obtained Toyota will start discussing the details with the Aichi prefectural government.

　トヨタは「正式な要請があれば、前向きに検討する」とコメントしている。

Toyota says, "If there is a formal request, we will be glad to consider."

　田原工場は埋め立て地に立地。敷地面積約３７０万平方メートルと、東京ドーム約８０個分の広さがあり、高級車「レクサス」などを生産している。トヨタは東北を小型車の生産拠点と位置づけており、復興を支援する意味でも「可能なことは協力したい」としている。

Toyota's Tahara Factory is located on the landfill. It is about 3.7 million square meters, or about 80 Tokyo Domes. The factory assembles cars including its luxury car "Lexus". For Toyota, the Tohoku region is the manufacturing base for its small, compact cars. The company says, "We would like to help as much as possible", to support the recovery of Tohoku.

According to Chunichi Shinbun (4/5/2012) which has been very gun-ho about disaster debris incineration, the governor of Aichi, Hideaki Omura (see photo), has decided to spend 600 million yen to plan for the incineration plant, temporary storage and a final disposal site, without deliberation in or approval from the Assembly. The prefectural government will use a special procedure called "Senketsu" - acting on its own.

Chunichi indicates that Toyota's factory will have the final disposal site where the ashes will be buried, and Chubu Electric's thermal power plant will get to burn the debris. Aichi Prefecture want to burn 1 million tonnes of disaster debris to help the recovery.

The Ministry of the Environment will reimburse the cost for new facilities that will process disaster debris from Tohoku.

Governor Omura is another Tokyo University graduate (law) and a former bureaucrat at the Ministry of Agriculture, Forestry and Fisheries before he turned to politics.

Toyota's Tahara Factory location:

大きな地図で見る

I guess Toyota and the Japanese government are counting on the WTO if global "baseless rumors" hurt Toyota's sales.

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Toyota to Stop All Factories in Japan Until March 16

from Nikkei Shinbun (original in Japanese; 3/14/2011):

Toyota Motors announced that it is shutting down all factories in Japan, including those of its group companies. According to Toyota, it is to "assist the recovery from the earthquake and secure the safety of the employees". Part of the reason may be that they are having a problem in securing the supply from Toyota's parts manufacturers in Tohoku region.

For other manufacturers, Isuzu has decided to shut its two truck manufacturing factories until March 16. Hino [another truck manufacturer] will shut down 3 of its factories until March 16. Their factories didn't sustain much damage, but they cannot secure the parts supply as well as supply of electricity.

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Toyota's Hearing Was For Raising Money for the Federal Government, Again

and again and again and...

Remember the brief but intense circus last February, when the federal agencies ganged up on Toyota? Now we have the result which I suspect was the government's purpose all along: more money going from us, to the coffers of the federal government.

House panel releases auto safety proposals (4/29/2010 AP via Yahoo Finance)

"WASHINGTON (AP) -- New cars and trucks would be required to carry black boxes to record crash information and automakers would pay fees to help fund the government's auto safety agency under a series of proposals in Congress in response to Toyota's massive recalls.

"...The draft legislation, released by Energy and Commerce Chairman Henry Waxman, D-Calif., would eliminate the cap on civil penalties an automaker could face and allow NHTSA to order an immediate recall if it finds an "imminent hazard of death or serious injury." It would also require new safety standards related to brake override systems, the prevention of pedals from getting trapped in floor mats and vehicle electronics.

"...The proposal would require a U.S. auto executive to certify the accuracy of information submitted to NHTSA in response to a government investigation. Any executive who provided false information could face up to $250 million in fines.

"Vehicles would be required to be equipped with event data recorders, commonly known as black boxes, to help authorities reconstruct the elements that led to a crash.

"The plan also creates a "vehicle user fee" of $3 per vehicle, increasing to $9 in its third year, to fund NHTSA's vehicle safety program. Safety groups have said the agency is underfunded and ill-equipped to investigate complicated safety problems." [Emphasis is mine. The article continues.]

If a private party does something similar, it is called blackmailing and extortion.

"Vehicle user fee"? A protection racket. Meyer Lansky and Lucky Luciano would be proud.

The whole point of this legislation is to grab more money for the government to feed its further growth. It it ends up raising costs for everyone else, well that's too bad but you want to be safe, don't you?

You see, the federal government is the ultimate Vampire Squid, not Goldman Sachs whom the ultimate VS is going after with "criminal charges" to extort even more money. (GS is penalized, some speculate, for making the government look stupid during the Senate hearing.)

Unlike Goldman, this ultimate VS can simply create a new legislation over any real or imagined problem so that it can jab its tentacles into a fresh body which didn't exist before. And it sure grows much, mush faster because it can afford to hire and retain workers of dubious qualifications and capabilities (some of them are extremely good at surfing the net, for sure).

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Slap on the Wrist: Citigroup vs Toyota

Toyota is facing a fine of over $16 million, maximum allowed by law, by the U.S. federal government which just happens to own two auto companies.

Toyota faces record $16.4M fine in gas pedal recall
(4/6/2010 USA Today)

"The government said Tuesday it has proof that Toyota knew about a safety problem involving sticking gas pedals for four months before it recalled vehicles and said it will penalize the automaker the maximum $16.4 million for the delay.

"That would be a record penalty for foot-dragging. The highest so far: $1 million against General Motors in 2004 for taking too long to fix potentially faulty windshield wipers.

"The law says an automaker must tell the government about a safety defect and begin a recall within five business days after discovering the problem.

""We now have proof that Toyota failed to live up to its legal obligations," Transportation Secretary Ray LaHood said Monday. "Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws."" [Emphasis is mine. The article continues.]

Gee, remember those huge SUVs made by GM, Ford, and Chrysler that rolled over and injured or killed drivers and passengers? I don't remember exactly but I am sure the automakers were grilled in Congressional hearings and fined, with their engineers jailed for unsafe designs.

And I'm sure the subcontractor who manufactures those gas pedals (or has them manufactured somewhere, probably in China) will be severely punished.

And there's Citigroup, paying a fine of $650,000 to Finra for its stock lending practice from 2005 to 2008 November, when it finally stopped. Damage done, the market crashed. The U.S. federal government also happens to own a huge chunk of Citigroup.

Citigroup Fined $650,000 by Finra for Stock-Lending Violations
(4/6/2010 Bloomberg via Business Week)

"April 6 (Bloomberg) -- A Citigroup Inc. brokerage will pay $650,000 to settle regulatory claims it inadequately supervised a system for loaning customers’ shares to short sellers.

"Citigroup Global Markets gave clients insufficient information about terms of its Direct Borrow Program, in which their hard-to-borrow stocks were pooled to accommodate short selling from 2005 to 2008, the Financial Industry Regulatory Authority said in a statement today. The firm’s marketing materials weren’t “fair or balanced” and lacked key information, the regulator said.

"The program arranged more than 4,000 loans from 2,300 clients, including retail investors, according to Finra. The New York-based bank suspended the program on Nov. 30, 2008, and returned borrowed shares to their owners, the regulator said."

I wonder if Citi even borrowed the shares.

Bear raid attacks using naked shorting, credit default swaps on companies' debts, CDOs, CDS on CDOs (for details on how they are actually used, read about David Einhorn's stragegies here) killed large financial firms, triggered credit crisis, global stock market crash, and global recession that destroyed many trillion dollars of wealth.

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Now It's FBI. Obama Government Piling Up on Toyota

While the sham hearing continued on Capitol Hill, FBI raided three Toyota suppliers in an anti-trust investigation. The three suppliers are Denso Corp, Yazaki North America and Tokai Rika. Their Japanese parent companies supply Toyota in Japan.

FBI raids US headquarters of Toyota supplier Denso in antitrust probe (2/24/2010 AP via Los Angeles Times)

"NEW YORK (AP) — The FBI raided the U.S. offices of three auto suppliers to Toyota and other manufacturers as part of an antitrust investigation, the agency said Wednesday.

"The FBI's Detroit office said agents raided the offices of Denso Corp, Yazaki North America and Tokai Rika. All the raids took place Tuesday evening. There was no immediate indication the investigation involved the safety of the auto parts." [The article continues.]

Apparently, Japanese companies supplying a Japanese company is a punishable offense in the U.S.

Denso supplies Toyota with accelerator pedals that are superior to the ones supplied by CTS and trouble-free. Can't allow that, can we? (Read these excellent articles from The Truth About Cars "Complete Guide to Toyota's Gas Pedals")

Abject apology by the CEO of Toyota was stupid and unnecessary. Clearly he wasn't informed of "taking the fifth". Chicagoland thugs won't stop until they drive Toyota out of the country. The U.S. consumers will have less, inferior choices when it comes to choosing their cars and trucks.

""Where is the remorse?" scolded Rep. Marcy Kaptur, D-Ohio." (from AP article today)

Hahahahaha that's rich. What a circus.

The inept DPJ (Democratic Party of Japan) administration is bogged down with land transaction scandal of the party leader and probably has little time or inclination to spare to protest to the Obama administration.

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Toyota and Goldman Sachs: Who's Bad?

So... I don't quite understand. Toyota is bad and evil because it built cars that occasionally failed for unknown reasons. Goldman Sachs is brilliant because it designed CDOs that would fail so that they could bet against them. And oh by the way in that process Goldman may have helped crash the world economy into the deepest recession since the World War II.

Here we have Goldman Sachs, who, from all indications, created CDOs (collateralized debt obligations) specifically designed to FAIL. Goldman sold them to either gullible investors or co-conspirators (think Societe Generale), often with AIG's insurance (CDS, credit default swap). Goldman itself shorted those CDOs through AIG's CDS. Sure enough, CDOs crashed when 1) underlying MBS (mortgage backed securities) crashed because of sub-prime loan debacle; 2) index that supposedly tracked CDS started to show unusually high spreads, making the securities insured with those CDS drop in price; 3) AIG got downgraded, triggering the collateral requirement and downgrade of CDOs; 4) all of the above and probably more. (Read AIG-related article by David Fiderer at Huffington Post, if you think you can keep your blood pressure from shooting up.)

Goldman Sachs has gotten away with it.

Now we also have Toyota, subject of media and congressional circus right now, whose Japanese CEO naively admits guilt, saying he is sorry, that his company shouldn't have expanded this rapidly, that they were remiss in quality, etc - the usual, honorable thing to do in Japan and totally stupid thing to do in the U.S., where anything he says will be used against him and his company in a criminal prosecution which the Obama government is so intent on pursuing.

For Toyota to replicate Goldman's success, Toyota has to build a car specifically designed to fail, sell it and take out huge insurance policies on the car and the driver. An accident happens, and the insurer cannot pay because the payout is simply too huge. The government steps in to pay on behalf of the insurer. When someone raises the question of a faulty car built by Toyota, Toyota will say "People are simply jealous of our performance, because we're so good." And people will say "Oh OK, I guess you guys are really good."

FBI raided the offices of Toyota suppliers Tuesday night. For what criminal offense?

Some people may say "Well, in Toyota's case, people actually have died from the defect." People have died from the stock market and housing market plunge at least in part caused by the products and trading strategies by the likes of Goldman Sachs. I remember a few who committed suicide.

Still, Goldman Sachs has gotten away with it.

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US Toyota Workers Stand Behind Their Man, Their Company

The Congressional hearing on Toyota's recall problems (aka "kangaroo court", aka "witch hunt" in the name of public safety, my foot) will have Toyota's CEO Akio Toyoda tomorrow.

Japan's Nikkei Shinbun reports that Toyota's US factory workers are in Washington D.C. to show their support for their CEO and for their company.

"The Congressional hearing on February 23 on Toyota's recall problems was an unusually popular event. The line of people wanting to attend the hearing was 50 meters long. 300 people showed up for 150 slots.

"Among them, there were people wearing shirts with Toyota logo. They were men and women who work in Toyota factories around the country. One of them, from a Toyota factory in Indiana, said to the reporter, "We are only a small portion of the Toyota employees. We want everyone to know that there are tens of thousands of Toyota employees supporting the company throughout the United States."

"Referring to Toyota's CEO Akio Toyoda, who is going to testify on February 24, she said, "I trust him to make the right decision. I want him to correct the wrong impression that Americans have gotten about Toyota over the recall problems."

"There are already people forming a line to attend the February 24 hearing."

CNN also reports that Toyota's US dealers staged a rally on Capitol Hill in support of the company and their brands which have exemplified quality worldwide.

Toyota dealers rally in defense of brand (2/23/2010 CNN International)

"Washington (CNN) -- More than 100 Toyota dealership owners and staff rallied on Capitol Hill Tuesday to defend their businesses and Toyota as Congress opened high-profile hearings into recent large-scale vehicle recalls.

""We take great pride in the fact that as of last night, together we've done over 690,000 recalls already and are pacing at 50,000 a day throughout the United States," Paul Atkinson, chairman of the Toyota National Dealer Council, said to the crowd. "My question for you is: How did we suddenly overnight become the villain?"

"... Tamara Darvish of Darcars Automotive was quick to point out more bad news for Toyota could mean more bad news for their network of 172,000 employees in the United States.

"Atkinson noted that, in the wake of last year's bailout of General Motors and Chrysler, they're now in competition with government-backed automakers for market share."

"... But a message of optimism also was a recurring theme at Tuesday's rally. AutoNation President and CEO Mike Jackson said he believes the drop in sales was largely due to the fact that many vehicles were taken off the market until they were repaired. He does not expect the brand to suffer in the long term.

""What's fascinating about the American people is that if they see a company that's done it right for decades, but has a bad moment and makes a mistake and owns up to it and commits to change and does everything possible to make it right, the American people will understand and forgive," he said."

That's the spirit.

Now, can you imagine GM (or Chrysler or Ford) factory workers and dealers coming to Washington D.C. to show support for the CEO and the company, defending their brand and quality? I can't.

Good for them, these Toyota US workers and dealers. I just don't buy the allegation that Toyota short-changed safety for the profit. That's not how they have made cars anywhere in the world, from what I once observed in a Toyota plant in Japan. Local Craigslist has a listing for night shift auto technicians at a Toyota dealership to fix the pedals.

Transportation Secretary LaHood today "testified that ... NHTSA's investigations of complaints about unintended acceleration have produced no evidence that electronic throttle systems are affected by electromagnetic interference, as some have speculated." (Wall Street Journal, 2/23/2010)

In other words, no one knows what causes unintended acceleration, but let's gang up on Toyota because it sells more vehicles than Government Motors and people actually like them, and we the government won't allow that.

My next car will be a Toyota.

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Chicagoland-Style Toyota Witch Hunt Intensifies

Don't they have better things to do?

Grand jury subpoena has been issued, and now SEC has joined the fray.

Toyota faces federal, congressional probe (2/22/2010 AP via Yahoo Finance)

"WASHINGTON (AP) -- Federal prosecutors have launched a criminal investigation into Toyota Motor Corp.'s safety problems and the Securities and Exchange Commission was probing what the automaker told investors, the company disclosed Monday. Newly released internal documents showed that Toyota officials visited with U.S. regulators years ago who "laughed and rolled their eyes in disbelief" over safety claims.

"The twin developments created new public relations challenges for Toyota plus the prospects -- however likely or unlikely -- of hefty federal fines or even indictments against executives in the U.S. and Japan. They also complicate Toyota's ability to discuss details driving its recall of 8.5 million vehicles because anything executives say could be used against the company inside a courtroom.

"Top Toyota executives were expected to testify at hearings Tuesday and Wednesday on Capitol Hill. One lawmaker said he believed Toyota misled owners about the repairs and relied upon a hastily-arranged study to reassure the public.

"In a new filing with the SEC, Toyota said it received the grand jury request from the Southern District of New York on Feb. 8 and got the SEC requests Friday.

"It wasn't immediately clear what U.S. laws Toyota might have broken. A subpoena would specify why prosecutors sought company documents, but Toyota would not comment beyond its disclosure with the SEC. A spokeswoman with the U.S. Attorney's Office for the Southern District of New York declined to comment, saying it does not confirm or deny its investigations as a matter of policy."

"...Legal experts said the fresh subpoenas could affect how Toyota executives respond to the questions from lawmakers.

"Eric Dezenhall, a crisis management consultant in Washington, said the subpoena might cause Toyota to limit its testimony because apologies are admissible in court. He predicted the company would walk a line between carefully phrased testimony and enough disclosure to describe the cars' mechanical problems and steps Toyota had taken to make the vehicles safer." [The article continues.]

Ms. Shapiro's agency is yet to do anything about naked short selling that probably precipitated the market crash in September-October 2008 which in turn crashed the global economy, or about so-called "flash-trading" (aka front-running) by big investment houses like Goldman Sachs. But she finds time to investigate Toyota.

This is getting beyond absurd.

No word about other companies with the same sticking pedal problems. No word about the company (CTS) who makes the accelerator assembly for Toyota and other major auto manufacturers including GM, Ford, Chrysler, and Honda that is known to cause the problem.

And how about this allegation by Wayne Madsen that CTS's accelerator may be negatively affected by military frequencies? (CTS supplies to the US military.)

But no. Obama-land is intent on doing all it can to squash Toyota by staging a show trial. With the subpoena, Toyota executives have little choice but take the fifth in the congressional hearing, and they will be painted by the obliging media as "guilty". Its union pals must be ecstatic.

When will Japan start dumping US Treasuries, I wonder?

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Connection Between Toyota's Sticking Pedal Problem and US Military

It's two-fold.

Lewrockwell.com has an article on Toyota recalls that says, among others, President Obama and his Chief of Staff Rahm Emanuel decided to blow up Toyota's sticking pedal problem in order to pressure the new Japanese administration who wants U.S. military bases out of Okinawa.

It also says something very curious and interesting: Toyota's accelerator assembly made by an American company CTS, who also supplies to GM, Ford and to the U.S. military, is susceptible to "non-civilian" (i.e. "military") frequencies.

Here's the original article that Lewrockwell.com linked:

Obama waging economic warfare on several fronts, including Japan
(Wayne Madsen, 2/12/2010 Online Journal)

"(WMR) -- The Obama administration has expanded its economic warfare against other countries, first reported on January 18 by WMR in the case of an authorized financial campaign against Venezuela. The Obama administration, according to WMR’s Asian sources, is waging an economic warfare campaign, coupled with industrial sabotage, against Japan through a pre-planned operation directed against the Japanese automobile manufacturer, Toyota.

"WMR has learned that the Obama administration authorized the anti-Toyota campaign as a warning shot to Japan over its reformist government’s insistence that the U.S. pull its military troops out of Okinawa. WMR has learned that Obama and his chief of staff, Rahm Emanuel, have decided to turn the screws on Japan, not only for auto market leverage, but also to punish Japan over the insistence by Prime Minister Yukio Hatoyama and the newly-elected anti-U.S. military mayor of Nago on Okinawa to move the U.S. military off of Okinawa."

The article continues, and this is the part where he discusses CTS's accelerator assembly:

"Ironically, Toyota does not make the sensor-equipped accelerator pedal for its recalled vehicles. Elkhart, Indiana-based CTS (formerly known as Chicago Telephone Supply) manufactures the pedals for Toyota, as well as for Ford and GM. China’s Jiangling Motors has complained about sticking gas pedals from CTS and the firm has developed a reputation for faulty accelerator pedals and their associated sensors. CTS’s president and CEO is India-born Vinod Khilnani. Curiously, the Obama administration, which is flush with Indian-Americans at high levels, has not criticized CTS, especially since it supplied the very same accelerator pedals it manufactures for Toyota and GM to the U.S. military."

and

"The CTS-manufactured accelerator pedal used in Toyotas relies on an electronic pressure sensor. WMR has been informed by knowledgeable sources that the sensors are vulnerable to non-civilian frequencies. The Obama administration, fearful that military transmissions may be responsible for accelerator accidents, may have sought to jump the gun by blaming Toyota for the accelerator problems." [emphasis is mine]

I have no idea whether Mr. Madsen's sources are reliable or telling the truth. I wouldn't have noticed the article if it hadn't been featured at Lewrockwell.com.

By the way, that Obama administration's intent is political is evident by the fact that the US government is demanding the data for Toyota's European recalls. Since when has the National Highway Traffic Safety Administration started regulating internationally?

Is the agency demanding the international recall data from GM and Ford, too? Honda? I haven't heard about it. Have you? How about demanding the data from CTS?

Toyota will be fined if it doesn't submit the data within 30 to 60 days.

And the problem may have been caused by the U.S. military frequencies.

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Toyota May Be Slapped A Civil Fine Over SUA

SUA: Sudden, Unintended Acceleration

More on my previous post on Toyota's recall, production halt, and Congressional hearing.

The National Highway Traffic Safety Administration is considering a civil fine against Toyota Motors, according to AFP report today.

Hmmm. Am I alone in smelling a rat?

Roger Hedgecock, a popular radio talk show host at KOGO San Diego, CA, suspects Toyota is being targeted by the Obama administration because Toyota produces cars and trucks that people want to buy, with its non-union labor force.

Obama attacks Toyota (Roger Hedgecock, 2/1/2010 World Net Daily)

"Toyota owners stormed dealerships all over the country last week demanding "fixes" for "defects" described in wildly inflammatory press reports.

"Toyota apologized for "defects" that to date are still being investigated. Before whatever problems might exist had been determined and before any "fix" has been found, the government ordered Toyota to begin the largest recall of vehicles in automotive history. Toyota then shut down its U.S. plants and stopped selling eight of its popular models, including Camry and Corolla.

"The sales suspension affects about 56 percent of all Toyota and Lexus vehicles sold last year. The nation's Toyota dealers estimate they stand to lose $2.5 billion each month that sales of these popular models are suspended.

"...Toyota faces a perfect storm from SUA. But is government "greed" a factor here? As a co-owner of Toyota rivals GM and Chrysler, is the Obama administration and its jihad against Toyota "consumer protection" or revenge against a successful, non-union, red state based rival? Given what Rahm Emanuel said about crisis as an opportunity to "advance the agenda," this question deserves closer attention.

"A year ago, Toyota was riding high. With non-union manufacturing plants in Georgia, Texas, Mississippi, Kentucky and Indiana, Toyota made the most popular and most highly regarded vehicles in the U.S. Rivals GM and Chrysler were imploding, and the president stepped in with massive taxpayer cash infusions and took over these companies as joint ventures between the federal government and the UAW.

"Why is Toyota singled out for SUA? A Consumer Reports study indicated that, for the model year 2008, there were 52 complaints filed with the National Highway Traffic Safety Administration against Toyota for SUA, representing 41 percent of all such complaints even though Toyota had just 18 percent of the U.S. market.

"However, the same Consumer Reports study relates that GM and Chrysler also were the subject of SUA complaints to the NHTSA, but none of their plants were shut and the affected models were not recalled nor banned from sale. One of the vehicles named in these complaints is GM's Pontiac Vibe but the NHTSA has not ordered its recall nor banned its sale.

"The American Company (CTS of Elkhart, Ind.) that supplies some Toyota models with the gas pedal in question also supplies the same gas pedal to Honda, Ford, GM and Chrysler.
Worth noting, too, is the fact that SUA complaints increased after 2002 when Toyota replaced mechanical throttle linkages with electronic ones. It's just easier to find and fix mechanical defects than software glitches. Even the NHTSA could not find the electronic defect that some "experts" allege must be causing the SUA in these complaints.

"All of this is a field day for the Plaintiff's Bar, another Obama ally. Attorneys made fortunes in the "unsafe at any speed" Corvair, exploding Pinto and rollover Ford Explorer cases. These could pale in significance compared to SUA and the scale of Toyota's recall. The publicity over 52 complaints out of 1.8 million Toyota/Lexus vehicles sold in the U.S. in 2008 has made every owner concerned about the safety of their Toyota vehicle.

"This panic could fuel lawsuits big enough to put Toyota out of business in the U.S. What a boon for Government Motors! Indeed, last Friday, GM, Chrysler and Ford all announced ad campaigns aimed at worried Toyota owners.

"Toyota will announce a "fix" for the gas pedal this week. What's at stake here is not just the safety of the individual Toyota vehicle, nor even the financial health of that company – but the very existence of a free competitive vehicle market in the U.S."

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Toyota Recall, Production Halt Were Ordered by Obama Administration

There's something funny going on regarding Toyota Motors recalling the cars and trucks and stopping sales and production.

Toyota announced it was recalling 2.3 million cars and trucks it had sold in the U.S. because of sticking accelerator pedals.

Then, the company announced it was stopping the sales of the affected 8 brands, and stopping the production of these cars and trucks in the U.S. while they figure out the cause.

The pedal assembly is manufactured by an American subcontractor (CTS), who says it is Toyota's problem not theirs, as the company also supplies Honda and Nissan.

It turns out that CTS also supplies GM and Ford. Ford today suspended the production of commercial vans in China, which use the pedals supplied by CTS.

Then, it turns out that Toyota's recall and sales/production suspension was ordered by the Obama administration, specifically by U.S. Transportation Secretary Ray LaHood.

Government Motors, also known as General Motors, is offering $1,000 or zero financing to Toyota owners to switch brands. Nice job, Auto Czar. Ford has decided to join.

Now, Congress has joined the frey. House Energy and Commerce Committee (chairman Henry Waxman, D-CA) will hold a hearing on February 25 "to examine the persistent consumer complaints of sudden unintended acceleration in vehicles manufactured by the Toyota Motor Corporation".

A Congressional hearing??

Toyota today announced additional 1.09 million recall due to floor mat concerns.

Brands recalled:
2009-2010 RAV4
2009-2010 Corolla
2007-2010 Camry
2009-2010 Matrix
2005-2010 Avalon
2010 Highlander
2007-2010 Tundra
2008-2010 Highlander
2009-2010 Venza
2008-2010 Sequoia

Lexus, Scion, Prius are not affected.

Toyota's share price, which was at $91.97 on January 19 before the announcement of recall, plummeted $14 dollars (or 15%) since, and ended today at $77.67.

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Penkse To Buy Saturn from GM, Wants to Build in US

Now this is more to my liking. The first decent piece of news that I've heard about the sorry saga of bankrupted Chrysler and GM, where private entrepreneurship saves the day. Penske Automotive Group Inc. (stock symbol PAG), the second largest auto retailer in the United States, signed a memorandum of understanding with General Motors to acquire GM's Saturn brand.

According to this article Penske buying Saturn, dealerships; GM to build vehicles for 2 years (6/5/09 Detroit News),

"Penske has signed a memo of understanding to acquire Saturn and its dealer network and the due diligence period will take 60-90 days. The deal will preserve 13,000 jobs and could close in the late third quarter, Penske told reporters this morning. Terms of the deal were not disclosed.

"The deal includes the Saturn brand, the service and parts operation based in Spring Hill, Tenn., and a network of about 350 dealerships.

"Penske said GM will supply the Saturn Aura sedan and Vue and Outlook SUVs on a contract basis for at least two years, after which he envisions importing vehicles."

""Our ultimate goal is to have those vehicles built in the U.S.," he said."

Why Saturn?

Here's the announcement from the company. [emphasis is mine]

""We have agreed upon a framework that we believe will build momentum for the Saturn brand," said Penske Automotive Group Chairman Roger Penske. "Saturn has a passionate customer base and outstanding dealer network. For nearly 20 years Saturn has focused on treating the customer right. We share that philosophy, and we want to build on those strengths."

Mr. Penske and his company want to buy Saturn because Saturn focused on treating the customer right. How about that, coming from an American company?

"Saturn began selling cars in 1990 and has sold more than 4 million vehicles. More than 80 percent of those vehicles are still in operation, according to data from R.L. Polk. Saturn has regularly scored among the industry leaders for non-luxury brands in customer satisfaction surveys. Commenting on the proposed deal, Saturn general manager Jill Lajdziak said, "This is the combination of two iconic teams: Saturn and Penske. GM had the vision to create Saturn and has the desire to see it succeed in the future.""

Saturn's customers are happy because the car is built well and it lasts! What a concept. Saturn, at one point, even dethroned Lexus in J.D. Power and Associates 2002 Customer Service Index (CSI) Study. (By the way, the link goes to a blog set up by a Saturn enthusiast, called Saturnfans.com. The front page pleads "Save Saturn. Sign the Petition to Help Save Saturn!")

Ms. Jill Lajdziak, Saturn's general manager, will be offered a role in a Penske's new company, according to the Detroit News article. She joined GM in 1980, and has been with Saturn since its inception.

GM indeed had the vision, when it founded Saturn Corporation in 1985 in response to ever-increasing competition from small cars made by Japanese and German auto makers. But the vision hasn't quite turned into a viable business at GM. Now that the administration is pushing for small, fuel-efficient car, GM has to sell Saturn.

Saturn has its own assembly plant in Spring Hill, Tennessee. Why wouldn't Mr. Penske simply by the whole operation and run it? He and Penske Automotive Group would know what kind of car the customer want. As the 2nd largest auto retailer, they would know GM and Saturn that no outsider (like Fiat, for example) could know. They could possibly clean up the manufacturing operation.

I'll refrain from being overly optimistic until the deal is done and more details known. I hope the Auto Task Force and Mr. Rattner the car czar (for cacophony of czars, see my post here) stay out of the deal. (Oh no...don't tell me this is the deal brokered by them... )

As I wrote several posts ago, Toyota is increasing production, both in the US and back in Japan. GM and Chrysler may have been bankrupted at the bottom of the market. Pity. And shame.

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Toyota Will Increase N.America Production, Says Market Bottoming

Now here's a "green shoot" I can give slightly more credence to.

Toyota Motors will increase production in North America over the next 3 month (6/4/09 Yomiuri News, Japan; the article is in Japanese)

"Toyota announced on June 3 that it will increase North American production by 65,000 units more than originally planned.

"Toyota has cut back its production since last summer, but now believes the market is bottoming out. It will increase output of Camry, Corolla, Siena, RAV4, Tacoma, and Tundra.

"Toyota's year-over-year monthly auto sales in North America has been decreasing by over 30%. Toyota's 7 US factories have reduced hours and introduced work-sharing scheme to cope with the declining sales.

"In Japanese market, Toyota already started to normalize production in May. "

Toyota's layoffs in North America was minimal despite the steep decline in sales. In addition to work-sharing, they also used the idle time to train idle workers on new skills, quality improvement, and maintenance. (Hear that, UAW?)

Now, if Toyota is right, Chrysler and GM driven to bankruptcy start to look like Gordon Brown selling gold at the gold market bottom, don't they?

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