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Toyota to expand disclosure amid pressure on CEO

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Toyota to expand disclosure amid pressure on CEO

Malcolm Foster / Associated Press

Tokyo -- Toyota said today it's planning a new level of disclosure about car problems beyond what the automaker is legally required to reveal as it seeks to rebuild consumer trust.

The move comes amid intensifying pressure for the automaker's president Akio Toyoda to testify before the U.S. Congress about safety lapses at hearings scheduled later this month. Presently, the highest-ranking company executive slated to attend the hearing is Toyota's North American head, Yoshimi Inaba.

Experts say it's vital that Toyoda appear at the Washington hearings to reverse the perception that the company has been slow to recognize and tackle the safety problems that have led it to recall 8.5 million vehicles.

"The final authority needs to be there and explain the situation and say what the company is doing to resolve the problems," said Yoshinobu Yamamoto, professor of international relations at Aoyama University.

If the hearing in Washington goes poorly -- if Toyota executives come across as aloof or U.S. politicians come down in a way perceived in Japan as excessively harsh -- it could even hurt diplomatic ties between the two nations. Relations are already strained over a dispute about plans to relocate a U.S. Marine base on the southern Japanese island of Okinawa.

"This is Toyota's problem, but if it's mishandled, it could spread to other areas," said Yamamoto.

Japanese media reports say Toyoda will attend the hearings in Washington, but the company declined to confirm that.

Toyoda is expected to visit the U.S. in early March to meet with government officials and Toyota employees -- but that would come after the House Oversight Committee hearing set for Feb. 24 and the House Energy and Commerce Committee hearing planned for Feb. 25.

Today's news that Toyota plans to voluntarily disclose problems that are below recall-level seriousness shows that Toyota is taking some steps to restore its reputation. Details of the plan for more openness would be announced in the future.

"We're trying to be proactive," said spokeswoman Ririko Takeuchi. "Some consumers are worried, so even if the information doesn't rise to the level of a recall, we are taking this step to restore the company's credibility."

"They might be minor (problems), but drivers may need this information," she said, declining to describe what kinds of problems they might include.

Toyota, the world's biggest automaker, is in the midst of recalling about 8 million cars for a gas pedal that can stick in the depressed position and floor mats that can get stuck under the accelerator.

After being nearly invisible the first part the crisis, Toyoda, the president, has apologized several times for the recalls, most recently at a news conference Tuesday after the automaker announced it was recalling 437,000 Prius and other hybrids over brake problems.

Toyoda also wrote an opinion column in Tuesday's edition of the Washington Post, in which he promised an outside review of company operations, better responses to customer complaints and improved communication with federal officials.

Japanese media have criticized the company over its slowness and lack of clarity in explaining the series of embarrassing recalls. Japanese government officials have also criticized Toyota.

Symptomatic of the public relations disaster for Toyota in the U.S. -- its biggest market -- the company's woes have become joke fodder for popular TV talk shows such as David Letterman's "Late Show" on CBS and Jay Leno's show on NBC.

Some analysts said the company's decision to recall the Prius -- its showcase "green" car -- signals that it is serious about fixing its image. In the past, the problem -- a glitch in the antilock brake that can be easily fixed by reprogramming the computerized braking system -- may have been dealt with through a service campaign that notifies owners to get a fix done at their convenience.

"Toyota seems to be taking a stance that it's going to do whatever it takes to restore its image," said Mamoru Kato, an analyst at Tokai-Tokyo Securities.

Earlier this week, Toyota also declined to accept a Japanese government energy efficiency award given to its Prius, saying the honor is not appropriate for a car hit by massive recalls.

Rep. Darrell Issa of California, the top Republican on the Oversight Committee, said Thursday that Toyoda should meet with lawmakers and suggested his committee hold another hearing with Toyoda as a witness. If necessary, Issa said, Congress should compel Toyoda's testimony.

"If we are not receiving the cooperation and transparency this committee and the American people are demanding from Toyota, I would fully support the issuance of a subpoena," Issa said. "We have a duty to determine what Toyota knew, when they knew it and if they met their full obligation of disclosure to U.S. regulators and the American people."

Democratic Rep. Edolphus Towns, who chairs the Oversight Committee, would decide whether to invite Toyoda or hold a second hearing.

The Senate Commerce Committee is expected to hold a Toyota hearing on March 2 but has not yet announced its witness list.

From The Detroit News: http://detnews.com/article/20100212/AUTO01/2120406/1148/Toyota-to-expand-disclosure-amid-pressure-on-CEO#ixzz0fL8m5Ysw

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