Daihatsu Scandal: Automaker Might Lose Up to RM3.2 Billion

Following the safety test scandal, Daihatsu might lose up to RM3.2 billion due to a production halt

Following the safety test scandal and multiple discrepancies, Japanese automaker Daihatsu is forced to halt its production in Japan, pending further investigation on this matter. As a result, the automaker is set to suffer a significant loss not only for the production halt but also for compensation to its local suppliers.

According to Nikkei Asia, it is estimated that Daihatsu will suffer over JPY 100 billion (RM3.2 billion approx.) in losses, with the bulk of the figure stemming from both its production facility shutdown and eventual loss in domestic sales, as well as the financial compensation for the suppliers.

While no exact figures were published for the latter, we can expect them to take a huge chunk out of the initial JPY 100 billion figure, with Daihatsu still holding negotiations with its suppliers for this compensation. On top of that, expenses stemming from the pending investigations and additional safety tests will also come into the equation.

The production halt announcement was made following the suspension of shipments of all 64 models and three engine series affected by this discrepancy. Though no exact date was given, it is expected that this production halt will last at least until the end of January 2024.

Aside from worrying about the potential gargantuan loss, Daihatsu might also face further sanctions and penalties, with Japan’s Ministry of Transport now conducting its own investigation on this matter. Aside from halting shipments until the safety of the vehicles can be verified again, the governing body may further sanction Daihatsu with worse charges, including revocation of its mass production certificate.

While things are going south in the Land of the Rising Sun, it appears that this scandal does not have a similar impact closer to home. We’ve previously reported that Perodua has already resumed operations, but the national automaker didn't mention any plans to cease or halt its production efforts, according to its official press release.

Similarly, UMW Toyota Motor (UMWT) has also published its official statement regarding this scandal, with the firm now “working closely with regulatory authorities to promptly and transparently address the matter" whilst maintaining its commitment to delivering its vehicles to the local market.