Toyota To Compensate Black, Asian Customers $21 Million For Racial Discrimination
Toyota has decided to compensate minorities with as much as $21 million, following the recent allegations of racial bias. Here’s how the move will add to the brand image of the company in the long
By Ghous Zaman on Feb 6, 2016 at 7:48 am EST
Toyota Motor Corp. (ADR) (NYSE:TM) has decided to compensate its black and Asian borrowers by paying them as much as $21.9 million, following federal regulators' allegation of discrimination. Toyota will settle the allegations of racial bias — which accused the company’s financing department to have excessively charged black and Asian customers in loan premiums. The company will pay 21.9 million to almost 100,000 affected customers, and has further set aside $2 million to be used if the same allegations rise again.
Toyota has been doing a lot to attract minorities to its products. In 2011, the company started featuring blacks and Asians in its ads — to derive company sales.
Moreover, on one occasion, Toyota’s former head of Marketing, Bob Zeinstra, said that the company makes ads for Hispanics, blacks and other minorities too.
Toyota claims to be the number one choice among minorities. The idea to keep minority consumers happy and satisfied has proven beneficial for the company. It is now on track to become the first Japanese company to have earned a record-breaking $25 billion in annual profits.
Following the recent incident, Toyota took initiatives to stop discrimination in its operations. The company has announced to put a restriction on dealers’ allowance of charging an interest rate. Previously, dealers were allowed to charge up to 2.5% interest on auto loans, which has now been reduced to 1.25%.
Toyota has denounced any kind of discrimination against any race or ethnicity,.......
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