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U.S. gov't demands Toyota hand over documents on recalls

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In certain cases, those who are doing so are really good at telling us that appearances are important. But there's more than an appearance of a conflict of interest with the U.S. Government and Toyota, that there's a very real one. The two companies that are going to gain the most out of this are General Motors and Chrysler makes clear.

While it may appear that govenment's conduct is judicious throughout this process, that appearance won't disperse the cloud of suspicion that hangs over the negotiations. If the government hadn't decided to become the controlling owner of two auto companies, GM and Chrysler, the worst suspicion would be that it's picking on a foreign based competitor of a large U.S. industry. Now the suspicion is that it's trying to hurt the strongest foreign based competitor of two companies it controls and from which it hopesto recover tens of billions of dollars it has thrown at them. No amount of outwardly professional behavior will negate the existence of that inherent multibillion dollar conflict.

We shouldn't blandly accept the idea that government's safety people, whose bosses have controlling interests in two competitors who owe them tens of billions, aren't going to let those situations affect their judgments as to how hard to push safety issues at a competitor. The fact that a consumer watchdog group that has tended to favor regulation in so many areas thinks that government has overreacted is not a trifling matter.

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Now the suspicion is that it's trying to hurt the strongest foreign based competitor of two companies it controls and from which it hopesto recover tens of billions of dollars it has thrown at them. No amount of outwardly professional behavior will negate the existence of that inherent multibillion dollar conflict.

You're assuming that government drones can think like businesspeople. They usually can't, that's why they are government drones.

I don't think it has anything to do with GM or Chrysler. I just think the U.S. govt is capitalizing on this problem and using it to gain public trust (we care about your safety) which has been eroding pretty quickly lately.

I honestly think the recent takeover of GM et. al is purely coincidental.

The billions owed to the government is like all other taxpayers dollars, they think of it like monopoly money. When you can deficit spend your way into trillions of debt, you don't really care about things like the bottom line.

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Now the suspicion is that it's trying to hurt the strongest foreign based competitor of two companies it controls [...]

Then why in gods name does it seem as if that foreign competitor is also trying to hurt its own business? Toyota could have done the right thing from the very start. Yet, it chose to hide and twist things. If Toyota had done things correctly it would not have been hurt very badly, yet because of its own conduct it has lost a lot. The conclusion for me is clear: Toyota is to blame, NOT the US government.

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Yeah, Toyota should have been open and done the right thing from the start, but they took the Japanese route: when you are in trouble just deny and lie first, then deal with it later.

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sarcasm123 -- agree. Toyoda-san is still holed-up in Nagoya trying to figure out which end is up, instead of getting out in front of this, as EVERY crisis-management expert in the world would tell them to do. (Sorry, but an op-ed piece he "wrote" in the NY Times, I believe, is not the solution.) And, Sfjp330, your conspiracy theory posts are getting very boring, particularly since they show no understanding of how the bureaucracy in the U.S. works. The Transporatation Department and Congress are being aggressive because they've been hit with charges of being too slow to respond. So, while politics is no doubt a factor, it is not to help GM or Chrysler. Rather it is to make sure the voters believe Obama and the Dems in Congress are protecting them. Novemebr is a mid-term election.

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sarcasm123 at 09:14 AM JST - 17th February The conclusion for me is clear: Toyota is to blame, NOT the US government.

Besides manufacturer, why don't the govenment to enforce the recall early? NHTSA is authorized to order manufacturers to recall and repair vehicles or items of motor vehicle equipment when ODI investigations indicate that they contain serious safety defects in their design, construction, or performance. ODI also monitors the adequacy of manufacturers' recall campaigns.

All companies have recall history and Ford, GM is not exception. The Toyota recalls occurred a decade after NHTSA withstood heavy criticism from Congress over its failure to detect a pattern of rollovers in Ford Explorer’s with Firestone tires. In that case, State Farm had given the agency documents warning of safety failures, but Congressional investigators said the agency was slow to realize the significance. History repeats itself and you're saying it's not the fault of the U.S. Govenment?

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sfjp330, how many Ford, GM, or chrysler dealerships do you see in Japan? Why do you think that is?

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to find out if the automaker acted swiftly enough

Toyota is in it now, Japanese companies cover things up, heck when there was a food scandal in Japan even the government did not release the names of the companies. Just cover it up is the Japanese way. I hope Toyota gets burnt hard for this for putting profit and pride over safety of lives.

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The NHTSA has been doing acrobatics to distance itsself from a situation in which it bore the ultimate responsibility for forcing Toyota to comply with U.S. safety laws.

"[Transportation Dept. director] Hood said the government urged Toyota to issue recalls and sent federal safety officials to Japan to warn company officials of the seriousness of the problems.

That's it? The largest scale safety recall in recent history over an issue that many are characterizing as a highly dangerous safety defect, and the best the Transportation Dept. could come up with was to send officials to Japan on U.S. taxpayers' dime to "warn" company officials about the seriousness of the problem?

Meanwhile, Ford still gets a free pass from the public and media over faults in its hybrid brkaing system that are identical to those in recalled Prius models.

Was Toyota wrong in how they handled things? Absolutely. They should have addressed the issues as soon as they were aware of them. Is there a conflict of interest here in how far and how hard the U.S. government and American public are pushing Toyota on account of the defects? One would have to be blind not to see it.

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Another day, another Toyota article. The congressional hearings is going to be interesting. Toyota should attack the recall questions head on. Toyota most likely will be making a lot of heads roll but use this experience to grow from it and move on. The past can't be undone. The present is what counts that determine the outcome of tomorrow.

Toyota have compromised their integrity when it came to making cars so they are not so different from GM or Ford. I would never buy a GM or a Ford because they have no principles/integrity (character) by attacking Toyota and Honda because of recalls in order to sell their cars. Character matters. GM and Ford have recalls in the past and will have recalls in the future along with Toyota like any other world auto makers because cars will not be free of defects because human beings are imperfect creatures.

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LFRAgain -- your conspiracy argument has no credibility, because, as is often the case, you are completely mistaken in your understanding of the facts. Ford is NOT getting a free pass. They are recalling their hybrids, just like Toyota is doing. What Congress and the Transportation Department are on Toyota's case about is completely separate -- the sudden acceleration problem. That has been linked to 34 deaths now, and goes back several years. (It clearly states that in the second paragraph of the story). At least read before you rant..

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Toyota is learning the HARD way that you cant just get in front of a camera & do a few meaningless bows, the US is clearly looks for more substance & information.

Japan = show, ritual apologizing US = information, disclosure, action

Toyota has screwed itself, PERIOD!

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Japanese bashing at it best! The US government owner of Government Motors and Chrysler is on full attack! They did not blame Ford as they should of done when the tires blew. The SUV's should not do that. It was a bad design. And what about all of the other recalls of American cars? I buy Honda cars myself and would never buy an "American car" with a lot of its parts made in Canada or Mexico. It appears that the US government wants to run Toyota out of the American market costing thousands of Americans their jobs as GM shifts its production to China and Mexico. Keep bashing Japan, Japanese do not like American overweight oversize sodai gomi vehicles and never will.

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Well, I think the US could learn alot about foreign product bashing and market protection from the master: Japan.

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Despite the global crisis, Japan is steadfast and enduring. Not just US others are also doing their best to bring Japan down. Toyota will win anyway.

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HUGE conflict of interest. How is this even legal? First they want to take out foreign competition, then they'll be going after Ford. I thought we were a capitalist country, not communist.

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herefornow,

"your conspiracy argument has no credibility, because, as is often the case, you are completely mistaken in your understanding of the facts. Ford is NOT getting a free pass. They are recalling their hybrids, just like just like Toyota is doing."

Your rebuttal has no credibility, because, as is the case here, you are misrepresenting my position with cherry-picking and selective interpretation of the facts.

When it became widely advertised that Toyota was recalling its Prius models in order to address the ABS software glitch, the American public jumped on that voluntary recall as an example of Toyota duplicity and underhanded dealings, spurring greater calls for congressional investigation.

However, when Ford quietly announced it was going to address the exact same problems -- not, mind you, via a recall, but rather via a voluntary “service campaign" -- hot on the heels of the NHTSA's announcement that it would ask Toyota to look into issues regarding its hybrid's braking systems, no outcry. No anger. No backlash against Ford. No one from the Transprtation Dept. announcing publicly that owners of Fords that experience the "sensation of lost braking power" should park their cars immediately. No questions about Ford's intergrity or safety record, despite Ford staying mum on an issue that had been well-known for as long as Ford had been selling hybrids in the U.S., and despite Ford having been at the forefront of the last most notorious recall in U.S. automotive history prior to Toyota. I’m speaking, of course, of the Ford Explorers with the exploding tires.

Toyota gets upbraided. Ford gets a free pass.

I've already acknowledged that Toyota was wrong for not dealing with the initial problems with the sticking gas pedals, both here and on other threads. But I see the outrage against Toyota to be highly disproportionate to the alleged crime -- the reason being no small amount of bias on the part of the American public.

If you disagree with me, fine. But don’t insult me just because you do.

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In return Japanese government and consumer beuraue must require to hand over documents of american piece of crap from Ford, GM, HP machines that falling apart all over in Japan!!!

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In return Japanese government and consumer beuraue must require to hand over documents of american piece of crap from Ford, GM, HP machines that falling apart all over in Japan!!!

Japan barely allows foreign goods to be imported, so this wouldn't affect these foreign companies much.

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History repeats itself and you're saying it's not the fault of the U.S. Govenment?

Ahem, let's think about it for a minute. You say Toyota is in trouble because of the US Goverment's actions, I say it is because of Toyota's own (lack of) actions.

To see who is correct, let's suppose one of the 2 possible actions did not occur, and see how it affects the outcome of this case.

Suppose Toyota did not what it did. So in other words, it took the correct actions right away, did not try to hide anything, and did not stall things. Result: minor crisis for Toyota, but public sees Toyota does the correct thing. Within a few months all is back to normal.

Suppose that the US Government did not what it did. So, in other words, they let Toyota keep ignoring the problem. Result: more more accidents, more deaths, ending in a big mess for Toyota, and loss of trust for years to come. Pretty close to the mess Toyota is in right now, but even worse.

And you are telling me that the US government's actions were wrong?? Compare the outcome of 1 and 2. If only Toyota had done what it should have done. But, you know, the victims were just some foreigners...

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Junnama, it is the market that keeps them out. Japanese do not like the models of autos that American Car companies import to Japan. They do not do well on the narrow twisting roads of Japan. The people of Japan do not wish to buy them.

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I suggest you actually check into that before posting. Go and compare the prices charged in the US for american made vehicles and then go and check the price in Japan for the exact same vehicle. Should be an interesting exercise...

Also, go and check what the best selling american small cars are in the US, Europe, and South America and see if those cars are even available in Japan. Then go find out why that is...

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Junnama, The cars are bigger than Japanese cars thus the price difference. The Honda Civic is considered small in America but large in Japan. Americans LOVE big cars perhaps to compensate for a deficiency in another thing? I would not buy an American car even if the price was the same. The quality is just not in their products. Even the small cars are engineered for the American road and not the Japanese road. They are so expensive due to the small volume of sales and high overhead for the dealers. Americans love Japanese cars as well. I know a lot who would never consider buying an "American" car even though it is a lower price. The USGov is just using its influence to destroy the sale of cars in the US. However just because Toyota sales are down will not mean an increase in Government Motors car sales. The people do not want them and understand what their government is doing.

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Japanese do not like the models of autos that American Car companies import to Japan. They do not do well on the narrow twisting roads of Japan. The people of Japan do not wish to buy them.

I'm sorry, but this just doesn't wash - American cars sell in Europe where the roads are just as narrow due to old cities as they are here. I see Peugeot and Alf-Romeo cars here that are not subcompacts, along with the occasional Volvo, but very few American cars.

The Japanese government does everything that it can to make sure that American cars, and other products that would compete well with Japanese products (rice, anyone?), are not easily imported into Japan. For so many years the American government has just rolled over in trade negotiations because Japan is our "ally". I think that the US ought to enact legislation that calls for reciprocal agreements - in short tit for tat with countries that do not allow the same access for American products.

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American rice justs taste bad. It is so dry and YUCKY. After WWII Japanese were force to eat it or starve. Japan still appreciates the kindness of America by sending it but it is not the type of rice Japanese perfer. I do not see a lot of foreign cars in Japan at all. Well the Americans can buy them on base and drive them in Japan. They get a discount on the weight tax and JCI. Also they can buy cheap gas on base. Gasoline that is subsidized by the government of Japan no less sold in facilities paid for and run at the GOJs expense. Hmm last time I was in Germany did not see a lot of American cars. Again America is trying to gain market share by bashing Toyota and soon Honda. This is proof of their intent.

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Junnama, The cars are bigger than Japanese cars thus the price difference.

I'll try again: Look up the selling price for an american car being sold in Japan, then look up the selling price for the exact same american car being sold in the US and see how much the difference is. I already know the answer but have you checked??

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Yuri, funny how you mention exploding Ford tires considering that Bridgestone (the company that made those tires) is owned and operated by Japanese. Gotta love the double standard; if there is even a possibility of a foreign product being defective (like the case of American beef imports when there was nothing actually wrong with the beef but a "risk" of mad cow) Japan bans them outright, on the other hand, dozens of Americans died due to Toyota's faulty engineering and the coverup, and if Americans dare to even complain then it must be Japan bashing. Hypocritical much?

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Hmm last time I was in Germany did not see a lot of American cars.

Opels is part of GM. Ford Germany controls 8% of the market....

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yuriotani is a perfect example of how the average Japanese is brought up to think Jpn products= good, foreign = bad............

And then gets mad when Toyota gets in trouble for..........causing trouble, deaths, injuries etc.

THAT is why so many foreign products have such a hard time here, its because of this inbred automatic reaction.

But the world is EXPECTED to buy Jpn made stuff.........

Dont get me wrong, lots of US made cars aint great but in Jpn they are just ruled out as a matter of course.

Jpn, you & Toyota are going to have to take this one on the chin because it is simply deserved, not get that damned prez outta Nagoya & send him to do his damned job for fire him!

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American rice justs taste bad. It is so dry and YUCKY

The stuff Japan was given after the war was long-grain (what I think most of the rest of the world prefers?) which does not go well with Japanese food. I remember during the Great Rice Crop Failure (15 years so so ago, was it?) people were getting all het up about how Japanese rice tasted so much better than everybody else's rice, but in blind taste tests most people, including so-called rice aficionados, couldn't tell the difference between Japanese rice and California-grown short grain.

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cleo,

I remember that time haha, thing was Jpn really screwed of the SEAsian market because Jpn was buying so much it drove the price up & made rice grown right in front of people(so to speak) too expensive to buy as the J-market was buying it up!

I was in Naha for the first time a week ago & what a nice change long grain rice in many of the places I ate at, great tasting stuff! Hell I love the mainland stuff too but a good Japanese is trained early in life that ALL other rice is bad, how sad!

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Elephunk, the SUVs should of not rolled due to a blowout. The rollover was what killed people not the blowouts. Oh I own a Honda in the USA and Japan not a Toyota. I own no Toyota stock. I own Civics in both countries and think they came off the same assembly line in Indiana. Thus in a way they are America cars. cleo, have not seen this rice for sale. You are right a American friend gave me a bag of Japanese stock rice grown in California and it tasted like Japanese rice. Maybe if they did a better job of marketing it?

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Hmm last time I was in Germany did not see a lot of American cars.

Ford and Opel are best-sellers (though trailing VW) in Germany. Both have an American mother, though car designs are done in Germany ...

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Yuriotani, how's it feel to get your bowl of rice served to you? I think you've been pretty well rebuffed on your America bashing points. At times you show some serious intelligence but your own pride gets severely in the way.

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Democrats in Congress are still upset at Toyota for being so competitive with American Brand names, and that Toyota sold so many cars under that ridiculous "Cash For Clunkers" program, which was intended to benefit Detroit. Their bashing of Toyota, however, might well benefit other foreign automakers, Japanese and South Korean especially, more than Ford, Chrysler, and GM.

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YuriOtani - The Japanese do not like them etc etc... I worked in a Japanese auto company for 17 years. The company and JAMA were absolutely against any dealer who would even consider a US import. The regulators went out of their way to make sure that the vehicles ever got into the showrooms. Which cars are all the celebs driving? Not Japanese. Honda Civic small car? I had a Honda Civic parked next to a Cadillac to prove to the media that your type of comments are nutty. Guess which was the small car? Go do the test yourself. Why don't pick-up trucks made by Japanese makers get sold in Japan? If they did the US makers would outsell them - so by removing the segment from the market the pickup becomes a special sector which costs more to import. AMerican makers do recalls when something is suspected to be wrong. Japanese makers charge the owner for repair of a different part but change the suspect part secretly. If you've never worked behind the scenes in a Japanese auto company I suggest you avoid this arguement.

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unscrejects, my civic is large in Japan. It is small only in America. About the other I do not know. I never worked in the auto industry. I have never liked Cadillac cars, there is something shoddy with how they are designed and built. I have owned GM cars in the past and have had trouble with them. My last one got 5km down the road before breaking down. The paint cracked, the alternator died, etc. This was before the car was a year old. My latest Honda has gone a year with just oil changes, no worries. I could care less what the celebs drive. My preferences are based on experience not hearsay. It is possible you are correct, oh there is a GM dealer here in Okinawa.

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YuriOtani : your posts are about Japan being superior to the US. This problem with Toyota is not a new issue - please take a moment to see my posts from three years ago. I warned that Toyota was leading Japan to a possible conflict with the US because of criminal business practices. I advised the Japanese ministry of transport in June this year to get the Toyota execs in for a warning. They didn't believe me. I am speaking from experience. My fear is not the US regulators or congress but I fear a Japanese whistle blower. I am so afraid because Japanese workers take company documents home - especially when they're doing bad business practice. The companies have a policy of hiding the papers at the worker's houses. The trouble is the worker realises the value of what he has and he sells it to the media or even to the US for a Green card. A Japanese company under suspicion in the US always loses. There is no way one of their workers will not report - for money.

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unscrejects, actually Japan is not superior to America but just different. I enjoy driving in America with their larger roads and not having to share the road with utility poles. It will be interesting to see what becomes of this. Wonder what Toyota will give to the Americans. Could this in the end get Toyota more trouble because of the cover-up than the problem?

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Kathleen DeMeter, the director of NHTSA’s Office of Defects Investigation Enforcement, wrote that the agency was “seeking to determine whether Toyota viewed the underlying defects too narrowly…without fully considering the broader issue of unintended acceleration and any associated safety-related defects that warrant recalls.”

What a hypocrisy. Wasn't it the NHTSA itself, which despite warnings ruled out the possibility of electronic defects and applied an unviable definition of the term 'sudden unintended acceleration' so that problems wouldn't show up in their statistics?

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To those who blame trade barriers as the reason why American cars sell so badly in Japan: how do you explain that European cars are so much more successful? And that Korean cars are not?

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gonemad,

there are NOT a lot of European cars in Jpn, some the expensive stuff does ok but you dont see a lot of average cars here, Jpn does an amazing job of keeping them at bay, the Japanese are trained from an early age in this stuff thats why they cant see it for what it is.

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YuriOtani - Hi! The question you asked, "Could this in the end get Toyota more trouble because of the cover-up than the problem?" Bingo! That's the logic even in Japan. But the unusual problem for Toyota is that they did not only cover it up - they told their dealers that this was a good business opportunity - the customer doesn't know that the parts need to be changed so do it in secret and charge the customer for it. Recommend a service that changes a part saying that it will increase your re-sale value... don't tell them which part you've changed. Also charge minimum labor. Remember that this was all supposed to be Toyota's cost. Now how does Toyota tell the US government we didn't cover-up when the US government knows that Toyota has been importing the parts? The parts related to the PCM are slow-moving parts. This means they are hardly if ever changed on a vehicle. By law when a new vehicle is exported to the US service parts, repair parts and slow-moving parts must be exported too. In the beginning of a new model sale service parts are sent at 60% of total volume shipped or if built in the US the dealers get 60% of the parts for the vehicles they'll be selling. Repair parts (or crash parts) are 19% and at 5% slow moving parts are put into the market - this is just in case there is an unexpected product failure. With me so far? Toyota however was supplying dealers with slow-moving parts for each vehicle in the market! That means there is a product failure and possibly with every car. The problem up to now is the government has not been able to identify exactly what is failing and how. Under the law one can't charge them with a crime until it can be proven. But then the Toyota old boys who see the grandson of their beloved founder treated this way (by those who threw him into the CEO seat to escape the responsibility)... they're going to blow the whistle. Toyota's own people will kill it. This is huge. Alsoo remember the Japanese parts makers who have been charged for these repairs also - yes Toyota also collected money from the parts makers. US customers and Japanese parts makers have been charged yet Toyota continues to deny the problem. How does the Japanese parts maker file his taxes when Toyota will not give him a receipt? Now you see what I'm afraid of? Toyota is no angel.

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GW, you are right that the total amount of imported cars in Japan quite low. But there is a striking difference between European and US made cars. Have a look at the figures for January 2010:

http://www.jaia-jp.org/e/stat/quick_report/201001shamei_e.htm

I don't think that the number one, VW, sells expensive luxury cars.

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JT, what happened to the underscores in the link? The above should be

http://www.jaia-jp.org/e/stat/quick[underscore]report/201001shamei[underscore]e.htm

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