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Toyota to Recall Its Lexus Sedans Sold in China

Toyota Motor Corp, Japan's biggest carmaker, said on Friday it will recall 1,489 Lexus sedans sold in China.

Toyota Motor (China) Limited, responsible for the Japanese firm's exports to China, on Thursday applied to the General Administration of Quality Supervision, Inspection and Quarantine to start recalling Lexus sedans on July 15 due to potential problems with transmissions.

"It will take us some time to ship transmissions to China to change those in these Lexus sedans for customers free of charge, if problems are found," said Yang Hongjian, a spokeswoman of Toyota's China representative office.

The expected recall will affect Lexus LS430 sedans made in Japan from July 29, 2003 to January 14, 2004, the representative office said in a statement.

Toyota has not received complaints from Chinese customers, according to the statement.

The move will be part of Toyota's global recall of 18,200 Lexus LS430s.

It will be the third car recall in China in two weeks.

On June 18, FAW Car Co Ltd, the Shenzhen-listed affiliate of China's No 1 automaker First Automotive Works Corp (FAW), started to recall more than 30,000 Mazda 6 sedans because of problems with fuel tanks and vent pipes.

FAW Car is producing the sedan under a technical licensing deal with Mazda Motor.

Honda Motor Co's car joint venture in Guangzhou, capital of south China's Guangdong Province, also recalled 70,240 Accord sedans over a possible fuel tank defect.

Other automakers, such as Mercedes-Benz, Mitsubishi Motor and Nissan Motor, recalled vehicles sold in China earlier this year or last year.

Although automobile recall is a common practice in developed markets, it remains new to Chinese customers.

The Chinese government published long-awaited automobile recall regulations on March 15 which will be officially carried out at the beginning of October.

"Recalls will take place in China more frequently with the growth of automobile sales in China, although the scale in China now is much smaller than in the developed markets," said Jia Xinguang, chief analyst with the China National Automotive Industry Consulting and Development Corp.

Sales of domestically made vehicles grew by 34 percent to 4.39 million units last year. China's auto market is forecast to reach 10 million units annually by 2010.

Automakers, especially Chinese producers, will face mounting pressure from automobile recalls, which could be very costly sometimes, and should be in full preparations, according to the analyst.

In the past, many manufacturers in China evaded recalls due to the lack of relating regulations.

Toyota has pinned high hopes on Lexus to tap China's luxury car market, which the company believes could be the world's largest.

The carmaker plans to build six franchised sales stores for Lexus this year in China and the number will increase to 14 by the middle of next year, according to sources with the carmaker.

The Japanese carmaker sold 1,549 Lexus vehicles on the Chinese mainland during the first five months of this year, according to Yang.

Lexus sales on the mainland reached 4,000 units last year, up from 1,600 units in 2002.

Toyota, aiming to control 10 percent of China's vehicle market by 2010, now operates three joint ventures in China with FAW to produce Corolla and Vios sedans, Land Cruiser and Prado sport utility vehicles, and the Coaster bus.

(China Daily July 3, 2004)

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