After much deliberation, the U.S. Department of Transportation (DOT) has decided to issue a $16.4 million penalty to Toyota – the maximum fine allowed – for failing to recall vehicles due to faulty accelerator pedals in a timely fashion. This will be the largest fine ever issued to an automaker by the government.

The U.S. DOT says that Toyota failed to promptly notify the government about the defective gas pedals amongst its model range. According to NHTSA, Transportation Secretary Ray LaHood says that there's evidence to prove Toyota knew of the gas pedal problem as early as late September, yet the official recall was not issued until the end of January.

Toyota will either have to accept the penalty and pay up, or contest the government's decision and continue deliberations. As of this writing, the automaker has yet to receive NHTSA's letter outlining the fine, and it has released this short statement regarding the situation:
While we have not yet received their letter, we understand that NHTSA has taken a position on this recall. We have already taken a number of important steps to improve our communications with regulators and customers on safety-related matters as part of our strengthened overall commitment to quality assurance. These include the appointment of a new Chief Quality Officer for North America and a greater role for the region in making safety-related decisions.
The automaker has two weeks to decide if it will pay the fine or contest the government's decision. Hit the jump to read NHTSA's official press release.

[Source: NHTSA, Automobile | Image: Alex Wong/Getty]
Show full PR text
Secretary LaHood Announces DOT is Seeking Maximum Civil Penalty from Toyota

WASHINGTON, D.C. – U.S. Transportation Secretary Ray LaHood today announced that the National Highway Traffic Safety Administration (NHTSA) is seeking the maximum civil penalty of $16.375 million against Toyota Motor Corporation for failing to notify the auto safety agency of the dangerous "sticky pedal" defect for at least four months, despite knowing of the potential risk to consumers. Approximately 2.3 million vehicles in the U.S. were recalled in late January for the sticky pedal defect. The penalty being sought against Toyota would be the largest civil penalty ever assessed against an auto manufacturer by NHTSA.

Auto manufacturers are legally obligated to notify NHTSA within five business days if they determine that a safety defect exists. NHTSA learned through documents obtained from Toyota that the company knew of the sticky pedal defect since at least September 29, 2009. That day, Toyota issued repair procedures to their distributors in 31 European countries and Canada to address complaints of sticky accelerator pedals, sudden increases in engine RPM, and sudden vehicle acceleration. The documents also show that Toyota was aware that consumers in the United States were experiencing the same problems.

"We now have proof that Toyota failed to live up to its legal obligations," said Secretary LaHood. "Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws."

Under NHTSA's current authority, the maximum possible civil penalty for related violations is $16.375 million. The penalty announced today relates specifically to the "sticky pedal" defect and NHTSA is still investigating Toyota to determine if there are additional violations that warrant further penalties.

"Safety is our top priority and we will vigorously pursue companies that put consumers at risk," said NHTSA Administrator David Strickland. "We will continue to hold Toyota accountable for any additional violations we find in our ongoing investigation."

On February 16, NHTSA launched an investigation into the timeliness and scope of the three recent Toyota recalls and required the automaker to turn over documents and explanations related to its adherence to U.S. auto safety laws. NHTSA made a preliminary determination on the fine announced today based on a review of documents Toyota has provided. To date, Toyota has submitted more than 70,000 pages of documents, which NHTSA officials are continuing to review.

NHTSA has the most active defect investigation program in the world, opening or closing an investigation almost every week. Over the last three years, NHTSA's defect and compliance investigations have resulted in 524 recalls involving 23.5 million vehicles.