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Toyota Remains Firm in Position on Emissions Performance

13 July 1999

Toyota Remains Firm in Position on Emissions Performance; Maintains its Systems Comply with Regulations

    TORRANCE, Calif., July 12 -- Toyota and the California Air
Resources Board (CARB) have been involved in a disagreement over the computer
that monitors the performance of Toyota and Lexus vehicles' evaporative
emission control systems.
    Today, CARB began hearings on the issue before a California administrative
law judge in Sacramento.  Coinciding with the California action, the U.S.
Department of Justice, on behalf of the Environmental Protection Agency, filed
a lawsuit against Toyota involving the same issues as the California
proceedings.
    "Toyota continues to be disappointed that despite our vehicles having the
best in-use emission performance in the industry, this matter has not yet been
resolved in a mutually agreeable manner," said Jim Olson, senior vice
president, external and regulatory affairs, for Toyota Motor Sales, U.S.A.,
Inc.
    "We are proud of our record as an auto industry environmental leader and
firmly believe our vehicles comply with the testing procedures as originally
written," Olson continued.
    In support of Toyota's position, the majority of automakers, both
international and domestic, have filed papers with CARB stating their interest
and concern in this issue.
    "Ultimately, this is not a disagreement over clean air or the performance
of an emissions system, so much as a question of an agency's right to change
regulations after the fact, reinterpreting them to fit their agenda," Olson
said.

    The facts of this issue are:

    --  None of the vehicles pose an emissions concern to the environment or a
safety threat to consumers.
    --  At this time, there is no recall of the vehicles in question, nor is
Toyota required to pay any fines.  CARB and EPA are pursuing avenues for
further review of the vehicles' operation, and possible action that Toyota may
be ordered to undertake.
    --  Toyota met with CARB before development of the OBDII system and
implemented CARB's recommendations; Toyota firmly believes that these vehicles
operate properly and comply with all levels of CARB regulations -- including
the OBDII regulation.
    --  During the "in-use" evaluation of Toyota and Lexus vehicles, CARB
conducted tests beyond those specified in their requirements and regulations.
    --  Painting the outside of two mid-size houses or refinishing two cars at
a body shop would release more hydrocarbons into the air than if all the
vehicles in question failed at the same time, which they won't because the
reliability of the evaporative emissions control system is very high.
    --  Toyota contends that no regulatory agency should bring an enforcement
action on an after-the-fact re-interpretation of a regulation.

    A chronology of actions:
    --  Late 1991: CARB institutes evaporative OBDII regulations
    --  Mid 1995: Toyota's evaporative OBDII system is approved by CARB
    --  August, 1997: CARB tests Toyota and Lexus vehicles, questions OBDII
performance
    --  August 28, 1998: Toyota files suit in California Superior Court for
OBDII rule interpretation
    --  September 2: CARB begins lengthy legal process that may or may not
result in a recall
    --  December 11: CARB begins administrative review process, breaks off
negotiations
    --  January 4, 1999: EPA announces intention to file litigation, seeks
legal review of case
    --  July 12, 1999: CARB recall hearing begins before California
Administrative Law Judge in Sacramento
    --  July 12, 1999:  DOJ/EPA file law suit

    Toyota maintains that its evaporative OBDII emissions control systems
comply with all regulations, and remains firm in that position.