As Toyota Motor announced a mass recall of its best-selling Prius, Japan’s transport minister on Tuesday criticized the company for its handling of safety problems, saying the auto giant should have been quicker to recall faulty vehicles.

“I would like you to respect the viewpoint of drivers and I wish you had taken measures earlier rather than simply saying it was not a major technical problem,” Transport Minister Seiji Maehara told Toyota president Akio Toyoda.

On Tuesday, Moody’s said it had put Toyota’s credit rating on review for a possible downgrade, warning that the auto giant’s worldwide recalls “may significantly damage” its brand image.

“This action is prompted by Moody’s concern that the growing scale of Toyota’s product problems and associated recalls may have longer term impacts on its brand equity, pricing power and market share in key markets,” it said.

“This raises significant risk that the recovery in the company’s earnings—whilst progressing—may not continue or will be at a much slower pace than originally contemplated.”

Toyota said it would recall hundreds of thousands of hybrid vehicles around the world, including Prius, plunging deeper into crisis as lawsuits in the United States piled up.

The company, facing a barrage of complaints ranging from unintended acceleration to brake failure, is scrambling to reassure drivers it did not sacrifice its legendary safety in its successful drive to be the world’s largest automaker.

But in another heavy blow to its brand image, long synonymous with reliability and quality, Toyota said it was recalling 437,000 Prius and other hybrid vehicles to repair a flaw in the braking system.

The company is now pulling almost 8.7 million vehicles around the world—far more than its entire 2009 global sales of 7.8 million vehicles.

“We will tackle the issue with dealers and suppliers,” Toyoda said at a news conference. “Together we will do everything in our power to regain the confidence of our customers.”

The Toyota family scion, under fire for his handling of the crisis, said he would travel to the United States to explain the safety troubles.

He denied the company, whose US executives face a congressional grilling on Wednesday, had become overly complacent as it overtook General Motors to take the global pole position.

“I don’t think Toyota is an almighty company. We are confident that we’ve been making improvements when we spotted a failure or defect to provide better products. We will continue this attitude in the future,” he said.

Toyota is facing a raft of lawsuits in the United States. In one of the latest, a California woman is alleging her Prius has severe braking problems, which make it dangerous to drive.

Lawyers for the plaintiff are pursuing what is believed to be the first class-action lawsuit over the faulty Prius brakes, which would add to legal trouble facing Toyota over the accelerator problems.

The company is pulling roughly 223,000 hybrid vehicles in Japan and about 147,500 in the United States due to a problem with the anti-lock braking system, in a recall that also extends to Europe and other markets.

The move covers the newest petrol-electric Prius as well as the plug-in Prius, the Sai sedan and the Lexus HS250h.

Drivers “can experience reduced braking performance resulting in increased braking distance”, the automaker said in a statement.

The Prius is the world’s most popular hybrid, beloved by Hollywood stars and environmentalists alike, and its troubles are a major setback to Toyota’s efforts to stay ahead in fuel-efficient automobiles.

Favored by celebrities, including Leonardo DiCaprio, Brad Pitt, Cameron Diaz and Britain’s Prince Charles, nearly 1.5 million Prius vehicles had been sold in 40 countries as of August 31.

The Japanese maker has said it redesigned the anti-lock braking system for Prius cars produced since last month.

It says a delay occurs when the vehicle switches to the conventional hydraulic brake from regenerative braking, used by hybrids to capture the energy of the car’s motion to recharge the battery for its electric motor.

The brake trouble comes on top of recalls of more than eight million vehicles worldwide due to sticking gas pedals that have been blamed for a number of fiery crashes, some deadly.

The group has denied it was slow to act on the safety problems.

The company received a US report of a sticky gas pedal on a Tundra pick-up truck in 2007 but said it was unable to pinpoint the cause.

Toyota said it had resumed production in North America of several models whose sales were suspended over the accelerator issue.

But it will suspend sales in Japan of the Sai and Lexus HS250h hybrids while it develops a fix for those vehicles.
AFP