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Wednesday, February 10, 2010


A worker secures Toyota’s Prius hybrid vehicles on a trailer on Feb 8, 2010. – Reuters pic

TOKYO, Feb 9 – Toyota Motor Corp said on Tuesday it has suspended shipments of its Sai and Lexus HS250h hybrids for possible problems in the models’ braking systems, as it prepares for a recall of its flagship Prius hybrid.

Toyota, which has already announced two other massive recalls, is fighting to keep its reputation for quality and reliability and deal with a potential rush of litigation.

Media also said Toyota President Akio Toyoda was considering testifying to Congress at a hearing in front of the House Oversight Committee in Washington. Toyota declined to comment.

The Sai and Lexus models use a similar braking system as the Prius, and Toyota has halted shipments at its Toyota Kyushu unit while it conducts checks to determine if any recalls of those models or other measures would be necessary, a spokeswoman said.

The Nikkei business daily said that Toyota may halt production and that a weeklong output shutdown would amount to a combined 2,000 units at least of the two models.

As Toyota’s North American plants resumed production of eight models involved in an earlier safety recall for sticky accelerator pedals, the world’s largest automaker said it was getting ready to recall the Prius hybrid car in Japan as early as Tuesday, a source told Reuters.

Toyota has said it has fixed a software glitch in the anti-brake lock system (ABS) on the third-generation Prius at the end of January and that cars being produced now would not be subject to any recall.

Shares in Toyota, which lost about a fifth of their value since late January, were up 1.7 per cent, outperforming a 0.7 per cent fall in the Nikkei average.

“The shares fell while Toyota appeared not to be doing anything to deal with its problems. But now, the fact that they’re taking concrete steps on the issue is being seen as positive,” said Hiroaki Osakabe, a fund manager at Chibagin Asset Management.

“But the gains will be limited since many investors want to see the impact of the problems on US car sales, with more share selling ahead if there’s a big drop.” – Reuters

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