In a truly astonishing disclosure, Daihatsu, the esteemed Japanese automaker that is under the ownership of Toyota, has made the decision to abruptly cease production at all four of its esteemed Japanese factories. This momentous development comes after an admission that has left many dumbfounded – a confession of a startling three decades’ worth of fraudulent safety tests. The impact of this revelation has been nothing short of seismic, reverberating through every facet of the automotive sector. As a direct consequence, operations will remain at an impasse until at least the conclusion of January, causing no small inconvenience for around 9,000 dedicated employees.
The scandal came to light when Daihatsu revealed that a committee, independent of their company, had discovered proof of manipulation in safety tests for 64 different vehicle models. These included cars sold under the highly respected Toyota brand. This disclosure deals a severe blow to Toyota, as they had already been under investigation in April for breaking crash test regulations on more than 88,000 cars. These vehicles were mainly from the Toyota brand and were sold in countries such as Malaysia and Thailand.
The latest probe revealed an alarming pattern of misconduct dating back to 1989, with 174 additional instances of Daihatsu manipulating data, making false statements, or improperly altering vehicles to pass safety certification tests. The company’s shares plunged by 4% in Tokyo, signaling investor concern and prompting Toyota to promise a comprehensive overhaul of its subsidiary.
Toyota issued a statement last week, acknowledging the severity of the situation, stating, “We recognize the extreme gravity of the fact that Daihatsu’s neglect of the certification process has shaken the very foundations of the company as an automobile manufacturer.” The automaker emphasized the need for “fundamental reform” within Daihatsu, addressing management, operations, and overall structural issues.
The aftermath from this controversy highlights the wider ramifications for Toyota, which now has the difficult task of winning back the faith of investors, regulators, and consumers. In addition to having an effect on Daihatsu’s output and brand, the incident has forced Toyota to examine its internal governance and processes in order to guard against future violations of safety regulations.