Benzinga - by Shivani Kumaresan, Benzinga Staff Writer.
Toyota Motor Corp. (NYSE:TM) has been found to have discrepancies in its vehicle certifications that also conflict with United Nations standards, a key set of regulations adhered to by 62 countries and regions, including the European Union.
The implications of these findings could potentially extend beyond Japan, affecting Toyota’s operations globally as regulatory bodies in other jurisdictions may consider taking similar action against the automaker, reported Bloomberg.
Earlier this month, Japan's transport ministry took a drastic step by halting the sales and deliveries of six models, three of which are Toyota's, including the Corolla Fielder, the Corolla Axio, and the Yaris Cross.
The action followed an internal investigation that uncovered falsified safety data during pedestrian-safety tests and the use of non-standard vehicles in collision tests for several other models.
Akio Toyoda, Toyota’s Chairman, responded to the crisis by stating that the tests were conducted under more stringent conditions than those required by Japanese regulations, ensuring that the vehicles are safe to drive.
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However, he admitted to significant lapses in the certification process and apologized for the oversight.
"We neglected the certification process and mass-produced our cars without taking the necessary precautionary steps," Toyoda remarked during a press conference on June 3.
Toyota, which is the largest automaker globally by volume, announced that this issue would affect two of its production lines, which collectively produce about 130,000 vehicles annually.
This comes at a critical time as the company prepares for its annual shareholder meeting next week. In 2023, Toyota manufactured and sold over 11 million passenger vehicles worldwide.
Toyota stock has gained 36% in the last 12 months. Investors can gain exposure to the stock via Amplify CWP International Enhanced Dividend Income ETF (NYSE:IDVO) and Altrius Global Dividend ETF (NASDQ:DIVD).
Price Action: TM shares closed higher by 0.80% at $208.02 on Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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