Toyota and Mazda Halt Shipments Amid Safety Test Data Scandal

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JAPAN-AUTO-INDUSTRY-RESULTS
Toyota Motor Corporation President Akio Toyoda (L) answers questions as Mazda Motor Corporation President and CEO Masamichi Kogai (R) looks on during their joint press conference at a hotel in Tokyo on August 4, 2017. Japanese auto giant Toyota and smaller rival Mazda said August 4 they agreed a capital tie-up to focus on joint development of electric vehicles, while building a 1.6 billion USD factory in the United States which will create up to 4,000 jobs. KAZUHIRO NOGI/AFP via Getty Images

Toyota and Mazda have paused the shipment of certain vehicles amidst a widening auto safety scandal in Japan.

According to CNN, this decision follows the discovery of irregularities in safety test data submitted for certification of certain models, including those from Honda, Suzuki, and Yamaha Motor, by Japan's transport ministry.

The ministry's directive prompted Toyota, Mazda, and Yamaha to suspend shipments of some vehicles.

Safety Test Scandal

The expansion of the scandal comes after a previous safety test issue at Toyota's Daihatsu unit last year. This development is likely to draw increased attention to Toyota's upcoming annual general meeting, with influential advisory firms recommending against re-electing Akio Toyoda as chairman.

Toyoda sincerely apologized for the oversight, stating that the affected cars did not undergo the correct certification process before being sold.

Meanwhile, Mazda disclosed findings of engine control software test manipulation and improper crash tests on certain models.

Yamaha and Honda also reported misconduct in their testing procedures on some of their models.

After this, there could be several potential outcomes. Shareholders may express dissatisfaction at the annual general meeting, potentially impacting Toyota's leadership. The affected automakers may face legal repercussions and regulatory fines for the safety test irregularities, which could damage their reputations and decrease consumer trust.

What's worse, according to experts, is that government authorities might increase scrutiny and impose stricter regulations on the auto industry to prevent similar incidents in the future.

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