Transportation Secretary Ray LaHood Backs Off Toyota Remark

(Feb. 3) -- Toyota's dire car troubles continued to pile-up this week as the U.S. Department of Transportation publicly shamed the automaker for its handling of sudden-acceleration concerns, causing the company's stock price to drop.

After telling lawmakers on Wednesday morning that he would advise car-owners to "stop driving" the millions of vehicles recently recalled by Toyota, Transportation Secretary Ray LaHood backtracked.

"What I said in there was obviously a misstatement," he said, according to The Associated Press.

But the damage to Toyota's stock had already been done: shares fell by 7 percent, only climbing back slightly in light of the secretary's clarification. The department is still advising owners of the 11 Toyota models affected by two massive recalls to exercise caution until fixes can be made.

On Tuesday, the secretary released a statement blasting Toyota for taking too long to respond to concerns over vehicle safety. LaHood also said he would soon be confronting Toyota's chief executive directly to "keep the pressure on" the company.

Congressional investigators are said to be drawing up plans to hold additional hearings on the matter.

The Department of Transportation has itself been accused of not acting quickly enough to bring Toyota into compliance with consumer safety standards. Agency officials now say that Toyota could face up to $16.4 million in civil fines for failing to issue a timely recall.

Last month, Toyota announced it was recalling some 2.3 million vehicles after reports about faulty gas pedals and sudden acceleration. The move came after an earlier recall in September 2009 over driver's-side floor mats that were found to jam underneath the gas pedal, keeping cars in motion. Some 3.8 million vehicles were affected. Now the U.S. Department of Transportation is investigating a new series of complaints about faulty brakes on Toyota's Prius model.

Toyota isn't the only Japanese automaker facing scrutiny. In January, Honda recalled 646,000 cars over a potentially flammable power-window switch problem.