US Markets
Monday, June 10th, 2024 2:29 pm EDT
Key Points
- Stock Plunge: Shares of Japanese automakers, including Toyota and Mazda, experienced significant declines following the revelation of false data used to certify certain models by the Transport Ministry. Toyota’s stock fell by over 5.4%, resulting in a loss of 2.45 trillion Japanese yen in market value, while Mazda saw a 7.7% drop, leading to a decrease of 80.33 billion yen in market capitalization.
- Ministry Inspection: The Ministry of Land, Infrastructure, Transport and Tourism conducted a wide-ranging inspection that uncovered irregularities in certification applications by other automakers, namely Honda, Suzuki, and Yamaha. Despite the stock declines last week, shares of all these companies were trading higher on Monday, with Toyota, Honda, and Mazda showing signs of recovery.
- Consequences and Response: Toyota and Mazda faced repercussions following the ministry’s investigation report. Toyota announced the temporary halt of shipments and sales of specific models, while its chairman, Akio Toyoda, apologized for the discrepancies. Mazda also suspended the sale of certain models but assured customers that existing vehicles can still be driven. The Transport Ministry plans to conduct on-site inspections of the implicated companies, indicating serious consequences for non-compliance. Additionally, this inspection follows previous safety scandals in the automotive industry, including issues identified at Toyota’s Daihatsu unit, which halted shipments of vehicles due to safety concerns.
The stock prices of major Japanese automakers experienced significant declines following revelations from the country’s Transport Ministry regarding the use of false data in certifying certain models. Toyota, Japan’s largest carmaker, saw a substantial 5.4% decrease in its stock last week, resulting in a loss of 2.45 trillion Japanese yen ($15.62 billion) in market value. Similarly, Mazda, the second-largest automaker in Japan, experienced a 7.7% drop in its shares, leading to an 80.33 billion yen decrease in market capitalization. Other automakers like Honda, Suzuki, and Yamaha also faced declines in their stock prices last week, but all showed signs of recovery on Monday, with Toyota, Honda, Mazda, Suzuki, and Yamaha seeing increases in their shares. The Ministry of Land, Infrastructure, Transport and Tourism’s inspection uncovered irregularities in certification applications by these automakers, including the submission of false test data and falsification of vehicles used in crash tests. Toyota and Mazda temporarily halted shipments and sales of specific models following the ministry’s investigation report. Toyota’s chairman, Akio Toyoda, apologized for the discrepancies and announced measures to address the issue. The Transport Ministry plans to conduct on-site inspections of the implicated companies, with this development following previous safety scandals in the automotive industry, including issues identified at Toyota’s Daihatsu unit.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/06/10/shares-of-toyota-mazda-honda-suzuki-fall-after-safety-scandal.html
