Toyota Motor Corporation’s (TM - Free Report) luxury brand, Lexus has announced to recall around 121,000 cars to fix fuel leaks that can cause a fire, per Associated Press. The majority of the recalls include cars in the United States. This is a blow to the Japanese auto giant, which has already been grappling with several recall issues.
According to Toyota, the fuel injection system, which is composed of diaphragm material, may harden over time, leading to a fuel leakage. The company has assured that the dealers are going to replace the fuel delivery pipe with a new one, which has improved parts, at no cost.
Toyota is one of the leading automakers in the world in terms of sales and production. In the past few years, the company has been recalling vehicles in large numbers. Recalls not only affect the company’s reputation adversely but also result in considerable expenses and lower vehicle resale value. In January 2018, Toyota announced a recall of 601,300 vehicles due to flawed Takata airbags. The recall comprised of Toyota and Lexus models. The latest case of recall includes certain 2006 through 2013 IS350 cars, 2010 through 2014 IS350C, and 2007 through 2011 GS350 and GS450h. All contain 3.5-liter V6 gasoline engines.
In the past six months, shares of Toyota have outperformed the industry it belongs to. During the period, its stock has inched up 0.7% in comparison with the industry’s decline of 8.6%.
Toyota currently sports a Zacks Rank #1 (Strong Buy).
A few other top-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (ALSN - Free Report) , Ferrari N.V. (RACE - Free Report) and Oshkosh Corporation (OSK - Free Report) . While both Allison Transmission and Ferrari sport a Zacks Rank #1, Oshkosh carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has an expected long-term growth rate of 10%. Over the past year, shares of the company have gained 6.4%.
Ferrari has an expected long-term growth rate of 17.3%. Over the past year, shares of the company have gained 56.2%.
Oshkosh has an expected long-term growth rate of 18.3%. Shares of the company have risen 1.1% over the past year.
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