Daihatsu Pauses Production Over Safety Scandal

Toyota-owned carmaker Daihatsu has shuttered all four of its plants until the end of January, following an admission of falsifying safety tests.

Daihatsu acknowledged manipulating safety tests on 64 models spanning three decades. Its Osaka headquarters in Japan closed on 25 December, marking the final closure in the series.

This scandal places the jobs of 9,000 workers in the country at risk and may impact the global reputation of car giant Toyota. Out of the 64 models implicated, 24 are marketed under the Toyota brand.

The Osaka plant closure follows shutdowns in production lines located in Oita, Shiga, and Kyoto prefectures. Daihatsu announced on Wednesday that it had halted shipments of all its vehicles after a transport ministry investigation revealed the latest admission.

The falsification of test results occurred due to pressure to maintain production continuity. The company expressed intentions to collaborate with its primary suppliers to address the repercussions of the scandal. It also suggested extending support to smaller subcontractors without compensation by facilitating access to support funds from Japan’s transport ministry.

During the idle plant period, Daihatsu committed to compensating 423 domestic suppliers with direct business relations. Established in 1907, Daihatsu sells approximately 1.1 million cars annually, constituting about 10% of Toyota’s annual vehicle sales of 10 million units.

Motor industry analyst David Bailey informed the BBC’s World Service that the issue initially surfaced in April concerning falsified collision tests. Subsequently, an independent commission by Toyota discovered additional problems, including airbags and speed tests.

While there is no current indication that the actual products were unsafe, the concern arises from testing a car with specific components and then selling a car with different components, evolving into a major issue.

Toyota previously faced damage to its reputation in 2009 due to a recall involving faulty floor mats and accelerator pedals. In 2012, it recalled over seven million vehicles worldwide, including some Yaris, Corolla, and Camry models, due to faulty window switches.

These recalls prompted a “fundamentally changed” approach at Toyota, with a renewed focus on quality and the inclusion of external experts for quality assurance. However, this approach does not seem to have extended to its subsidiary Daihatsu, according to Mr. Bailey.