Toyota warned of safety issues in 2006

Toyota bosses were warned about the safety implications of their aggressive cost-cutting as long ago as 2006, according to evidence submitted to US Congress yesterday.

A two-page letter sent to Toyota's former chief executive Katsuaki Watanabe from a minority labour union warned that safety was being compromised in favour of competitiveness.

The memo – whose principal author, Tadao Wakatsuki, has worked at one of the company's factories for 45 years – singled out Toyota's reduced product-development times, the pressure heaped on suppliers to cut component prices, and the increased use of computerised safety testing. It also criticised "amateurism" in the production process thanks to the mass-hiring of short-term contractors, and warned that the problems could ultimately threaten the company's survival.

The warning appears strikingly prescient as Toyota struggles to withstand the reputational damage of recalling 8.5 million vehicles in recent months following a string of technical problems including sticky accelerator pedals and issues with anti-lock braking systems.

The 2006 letter was put together by the All Toyota Labour Union (ATLU), a minority group which was started by Mr Wakatsuki in 2006 because he was concerned that the official union was not sufficiently forthright.

The criticisms were made in the context of another difficult period for Toyota. Recalls of Toyotas rose sharply between 2000 and 2006 as the company's production expanded, and the problems came to a head with a high-profile police investigation into allegations of professional negligence after one of the recalled models – a Highlander – crashed, injuring five people. The ATLU representations were made in the wake of the case, which was dropped, and the company was cleared of the charges.

The issue appeared to have gone away after Mr Watanabe launched a quality-control review. And by 2008, Toyota was the world's biggest car-maker, with a reputation for quality.

But following the recent massive wave of recalls – over faults which have been blamed for at least five deaths – the company's new chief executive, Akio Toyoda, has acknowledged that over-fast expansion has played a role in the recent problems.

Toyota formally submitted the ATLU letter to US Congress's Committee on Oversight and Government Reform yesterday in compliance with a request from Edolphus Towns, its chairman.

The revelations came alongside news that Daihatsu, which is 51 per cent-owned by Toyota, is recalling nearly 275,000 of its Hijet and Atrai mini-van vehicles in Japan over issues including missing or loose suspension bolts, loose fuel hoses and defective brake lights.

The car-maker is subject to a number of investigations in the US and Mr Toyoda offered an abject apology when he appeared before Congress in February. "All the Toyota vehicles bear my name," he said. "For me, when the cars are damaged, it is as though I am as well." Since then, Mr Toyoda has been on a charm offensive, desperately trying to repair the damage worsened by the implication that Toyota knew of the problems for some time before issuing the recalls.

The group went on the attack earlier this week over allegations that defective electronics were behind the unintended acceleration problems, claiming reports proving the point were "staged" and setting up engineering demonstrations to show that the only way to cause the fault was by completely rewiring the system, which had the same effect in other models of car.

So far, sales have not been hit as badly as feared. The company's US market share slipped by only 1.3 percentage points in January.