Toyota Motor Corp has closed the largest remaining chapter in a lengthy saga following a number of reported vehicle defects and recalls. To address the mass of potential claims attached to roughly 16 million Toyota vehicles throughout the United States, including in Ohio, the Japanese automaker has agreed to a settlement of $1.1 billion dollars.
The settlement is considered to be the largest to ever hit the automotive industry. The agreement also saves Toyota from enduring a trial process and admitting any fault. Meanwhile, all economic claims by drivers are now considered to be resolved.
Toyota is still on the hook, though, for lawsuits stemming from personal injury and wrongful death claims. That car accident litigation could cost the company many millions of dollars and still keep it under a negative spotlight.
Among Toyota's vehicle defects was a famous case of unexpected acceleration, which occurred in a number of vehicles in the United States, some of which resulted in car crashes. Several other defects and recalls were later found in many different Toyota models.
One of the biggest issues for Toyota was a concern surrounding its electronic throttle control system. That system was blamed for some of the defects, but Toyota insisted in its settlement announcement that numerous studies confirmed the system's efficacy.
But despite the amount of money lost in these legal proceedings, Toyota's bottom-line won't be hurting. The automaker is expecting big earnings in 2012 and saw its share values rise nearly three percent after the settlement was announced.
Source: Reuters, "Toyota seeks to settle acceleration case for $1.1 billion," Deepa Seetharaman and Bernie Woodall, Dec. 27, 2012