Toyota, Justice Dept. Reach $1 Billion Settlement: CNN
A Tuesday evening report from CNN cites an anonymous source who said that the U.S. Department of Justice and Toyota Motor Corp. (NYSE: TM) have reached a settlement in the criminal investigation of the sudden acceleration of Toyota vehicles. The company recalled more than 8 million vehicles in 2009 and 2010 after reports of sudden, unintended acceleration that may have been responsible for 75 fatal accidents that killed 93 people.
According to CNN, Toyota will pay more than $1 billion to settle the criminal investigation in a deal that could be announced as soon as Wednesday. The company has already paid out billions of dollars to settle civil claims related to the accidents.
The Justice Department investigation was initiated to determine what Toyota knew and when it knew it. The company’s public statements and disclosures to regulators were found to be misleading at least, and the unprecedented size of the settlement should be a warning shot across the bow of General Motors Co. (NYSE: GM).
GM’s recent recalls of 1.6 million vehicles to repair a problem with the vehicles’ ignition switch has all the hallmarks of a series of questionable public statements and even more questionable company decisions going to 2003. So far 13 deaths and numerous injuries have been attributed to the ignition switch defect.
Toyota stock closed down 0.76% on Tuesday, at $109.83 in a 52-week range of $99.70 to $134.94.
GM stock closed up 1.56% to $35.17 and added another 0.23% in after-hours trading. The stock’s 52-week range is $27.11 to $41.85.