Thursday, 11 March 2010
Owners of Toyota vehicles who insist that their cars dropped in value post the acceleration-related scandal at the company, have filed up to 82 class-action lawsuits in the country. It's possible that the damages from economic loss-related class actions alone could cost the automaker more than $3 billion.
The Associated Press has discovered a total of 89 class-action lawsuits for economic losses against the company. These plaintiffs insist that their vehicles dropped in value, after the recalls announced by the company, beginning last year. More than 6 million Toyota owners are claiming lost value of their cars.
Those claims have been streaming since the automaker announced its first recall for more than 3 million cars last year. That recall was linked to a defective floor mat which the automaker claimed was responsible for the accelerator pedal getting jammed. The recall was followed by more recalls this year that have caused the resale value of Toyota vehicles to plummet. This month, Kelly Blue Book lowered the resale value of Toyota vehicles included in the company's recall list, by an average of 3.5%. Owners of a Toyota Corolla on the list could end up with a resale value up to $300 lesser than it was before the recalls.
Toyota and class-action lawyers in California will be waiting for the decision of a special panel of judges later this month. On March 25th, the panel will decide whether to consolidate these claims for economic losses into a single jurisdiction. Then, there will be a decision about whether all the claims across the country can be combined into a single civil action.
Considering the sheer volume of numbers of Toyota owners claiming loss of resale value, the damages to the company from these lawsuits may be far greater than any damages from personal injury and wrongful death lawsuits, which have also begun to pile up against the company. So far, there have been 52 deaths confirmed from acceleration-related incidents from Toyota vehicles as reported by the National Highway Traffic Safety Administration. Even if you consider that each personal injury and wrongful death lawsuit could lead to settlements and verdicts in the tens of millions of dollars each, these will still be dwarfed by an estimated $3 billion plus total loss to Toyota from the lawsuits resulting from lowered economic value of the vehicles.