Toyota to Revamp Daihatsu After Rigged Test Scandal

In an industry where trust and safety are paramount, Toyota Motor Corporation is poised to embark on a significant restructuring of its small-car subsidiary, Daihatsu Motor, in the wake of a damaging scandal that has called into question the integrity of the carmaker's safety tests. The anticipated reforms, which are set to be disclosed in a month, come after an independent investigation revealed that Daihatsu had been engaged in widespread misconduct related to collision-safety tests, affecting models stretching back decades.

Toyota CEO Koji Sato expressed the gravity of the situation to the press, emphasizing that the company is taking the revelations with the utmost seriousness. The planned overhaul is expected to address both structural and operational deficiencies within Daihatsu, which may include a reevaluation of the barriers, or lack thereof, between the businesses of Toyota and Daihatsu. The move suggests a more integrated approach and enhanced oversight, strategies that Toyota believes could prevent future instances of misconduct.

In response to the scandal, Toyota is also contemplating a shake-up in Daihatsu's leadership structure, although specific details regarding the potential changes have not been disclosed. Given that engineers may be dispatched from Toyota to its subsidiary, it indicates a push for stronger compliance and quality control standards.

The scandal has had immediate repercussions with Daihatsu halting production at its Japanese factories since the last month. The severity of the misconduct, involving issues with models including some sold under the Toyota brand, is not light. The Japan transport ministry has initiated revocation procedures for the safety certification of three models, with Daihatsu being directly implicated in manipulating collision-safety tests for regulatory submissions.

Daihatsu's prominence in the small-sized vehicle market, particularly in Japan and Southeast Asia, positions it as a key player directly competing with the likes of Suzuki Motor, which holds a strong market presence in India. Nevertheless, this scandal threatens to tarnish its reputation and market position.

A comprehensive investigation has unearthed false reporting in headrest impact tests and misrepresented test speeds across various models. Notably, issues of wrongdoing seem to have intensified post-2014. Alarmingly, for one discontinued Daihatsu vehicle, the origins of malpractice have been traced back to 1989, indicating a longstanding culture of deceit within certain quarters of the company.

This announcement is a testament to Toyota's commitment to rectifying serious issues within its corporate family. As one of the leading automotive manufacturers globally, Toyota's handling of this crisis will be closely scrutinized by industry observers, consumers, and regulators alike. The scandal serves as a potent reminder of the paramount importance of ethical conduct and transparency in the highly competitive and safety-conscious automotive industry.