Toyota is set today to sign an agreement with the US government to pay a record $16.375 million fine. The NHTSA fined Toyota for failing to notify it of a sticking accelerator defect within five days of becoming aware of the problem.

It is the maximum fine allowed by law for a single violation.

Paying the fine will not release Toyota from any criminal or civil liability caused by the defect and does not preclude additional fines related to other recall issues.

Toyota failed to report the defect for at least 4 months after becoming aware of the problem, according to documents obtained by the government.

Once Toyota signs the paperwork, it will have 30 days to pay the fine.

Toyota has asked dealers to suspend sales of the Lexus GX 460 SUV after Consumer Reports issued a safety warning regarding it.

After tests done by Consumer Reports indicated a potential rollover problem with the SUV, it designated the vehicle with as, “Don’t Buy: Safety Risk.” The special designation hasn’t been used since 2001 when Consumer Reports gave it to the Mitsubishi Montero Limited.

In response, Toyota has suspended sales of the 2010 GX 460 and is offering a loaner car to any of the 5,000 people who have already purchased one, “until a remedy is available.”

Toyota maintains that the GX 460 meets or exceeds all government safety regulations.

Consumer Reports found the defect in a test for “lift-off oversteer.” In the test, the driver enters a sharp turn and lifts his foot off of the accelerator. Tests showed that the GX 460′s rearend, “slid out until the vehicle was almost sideways before the electronic stability control system was able to regain control.”

The test simulates a driving condition such as when a driver takes an exit and suddenly encounters an obstacle, for example. Natural impulse is to suddenly take one’s foot off of the accelerator.

With the rear of the vehicle skidding out so dramatically, it is likely that the rear tire will strike a curb or leave the pavement, inviting the rollover risk.

The Toyota 4Runner shares the same platform as the GX 460, but it passed similar tests done by Consumer Reports.

In response to continued issues of unintended acceleration, Toyota has created a process for “quick evaluation of unintended acceleration reports.” The program, called the “SMART Business Process” (“Swift Market Analysis Response Team”) is intended to speed up the process by which Toyota deals with each report of unintended acceleration.

In each case, Toyota hopes to respond to customers within 24 hours to set up a “comprehensive on-site vehicle analysis.”

Toyota hopes to diffuse complaints caused by its poor handling of recent massive recalls- both from a legal standpoint as well as from a customer-satisfaction standpoint. It also hopes that the program will restore some faith in its quality.

It may be too little, too late once again for Toyota as it continues to trail behind its problems and customer concerns. Given the severity of this issue (from either a safety or even just a PR perspective), a 24-hour response time is something Toyota should have been doing some time ago. Advertising it may just seem disingenuous.

On January 16, 2010, as Toyota executives debated how to handle the question of sticking gas pedals. As the executives debated the situation, then Irv Miller urged his colleagues to make the information public.

“We are not protecting our customers by keeping this quiet. The time to hide on this one is over. We need to come clean.” Miller added, “We better just hope that they can get NHTSA to work with us in coming with a workable solution that does not put us out of business.”

As other executives argued that the problem should be kept quiet until a solution could be found, Miller expressed his concerns that the accelerator problem was a safety issue and that Toyota needed to act quickly in announcing that.

Miller was group vice president for environment and public affairs at the time. His February 1 retirement was announced on December 16. His e-mails are a part of the 70,000 pages of documents that the government has received from Toyota as part of its investigation of the automaker’s handling of its recall issues.

Toyota issued a statement saying that it, “does not comment on internal company communications and cannot comment on Mr. Miller’s email.”

The last car rolled off of the NUMMI production line at 9:21 am local time on April 1. It was a red Toyota Corolla S that is believed to be destined for a museum in Japan.

The NUMMI (New United Motor Manufacturing, Inc.) plant was opened by GM in 1962 and closed in 1982. Toyota and GM reopened the plant in 1984 as a joint venture. As part of its restructuring following bankrupcy, GM pulled out of NUMMI in August, 2009.

NUMMI’s closure affects over 5,000 workers.

The future of the facility remains uncertain. Aurica Motors has announced that it would be interested in using the facility to produce electric cars. Though the announcement garnered much attention, it is generally considered unlikely since Aurica Motors is too small to support the NUMMI facility. In fact, Aurica has produced designs for an electric car but has yet to actually produce any vehicles. Many doubt that the company could even afford the $50 million annual electric bill for the NUMMI facility. Even the more established Tesla Motors turned down the NUMMI facility because it is “about 10 times the size of a facility Tesla would need.”

Also being considered is the possibility that the property might be used to build a new stadium for the Oakland Athletics baseball team.

The NHTSA has announced that it will seek the maximum fine against Toyota for failing to report its “sticking accelerator” issue in a timely manner. Federal law allows a maximum fine of $16.5 million.

Manufacturers are required to report safety defects to the NHTSA within five days of discovering the problem. Toyota became aware of the problem in September, prompting the fine.

In response to the reports of the fine, Toyota has issued the following brief statement:

While we have not yet received their letter, we understand that NHTSA has taken a position on this recall. We have already taken a number of important steps to improve our communications with regulators and customers on safety-related matters as part of our strengthened overall commitment to quality assurance. These include the appointment of a new Chief Quality Officer for North America and a greater role for the region in making safety-related decisions.

Toyota does have the opportunity to dispute the fine. When GM was fined $3 million for a violation in 2004, it was able to negotiate the fine down to $1 million- thus far, that’s the largest fine ever by the NHTSA.

Grounds for dispute include the fact that there may be political motivation behind the size of the fine given that it is so high compared to any other similar fine. Also, the specific violation that resulted in the fine has resulted in no serious crashes, injuries or deaths.

Additionally, documents show that Toyota was aware of the defect but did not recognize it as a safety issue. It was considered a convenience issue because the pedals get stuck only slightly depressed and the car can easily be controlled using the brakes. As a convenience issue, Toyota was not required to report the defect to the NHTSA and could easily dispute the fine because of that.

Still, there is speculation that Toyota may decide to simply pay the fine to avoid the continued negative publicity that would come from disputing the fine.

The NHTSA has also has stated that although this is the maximum fine for a single violation, it may still impose further fines if it determines that there were further violations by Toyota.