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Toyota plans U.S. recall of Lexus vehicles

Saturday, July 3, 2010; A14

AUTOMOTIVE

Toyota plans U.S. recall of Lexus vehicles

Toyota said Friday that it intends to recall 138,000 Lexus vehicles in the United States to fix faulty engines, in the latest quality problem to afflict the Japanese automaker.

The company said flaws in valve springs, a crucial engine component, could make the vehicle stall while in motion. Toyota said in a statement that it plans to file paperwork with the U.S. government on the recall next week. The recall affects certain GS, IS and LS vehicles from the 2006-2008 model years powered by 4.6 and 5.0 liter V8 engines and 3.5 liter V6 engines. No accidents or injuries have been reported. Vehicles from the 2009 and 2010 model years are not affected.

-- Associated Press

AIRLINES

Delta, US Airways drop landing-rights swap

Delta Air Lines and US Airways Group won't pursue a swap of takeoff and landing slots in New York and Washington under regulators' terms, a setback to strengthening their holds on two eastern U.S. markets.

The airlines instead plan to challenge in federal court the U.S. requirement that they give rivals more access to flights at New York's LaGuardia Airport and Washington's Reagan National Airport, according to a filing with the Transportation Department and Federal Aviation Administration.

Delta had sought to expand at LaGuardia to complement its hub at Kennedy International Airport. US Airways sought to build its base in Washington. The decision avoids a requirement that some flight slots be auctioned, opening the door to low-cost rivals.

-- Bloomberg News

ALSO IN BUSINESS

-- CIT Group names top financial officers: CIT Group, the large commercial lender, on Friday named a new chief financial officer and a corporate controller. Scott T. Parker, 43, and Carol Hayes, 49, complete the leadership team of chief executive John Thain, the former Merrill Lynch chief who took the reins of CIT in February.

Parker, who previously held leading roles in Cerberus Capital Management, becomes chief financial officer. Hayes, who was named controller, is a former Citigroup executive who was deputy controller.

CIT entered bankruptcy last fall after suffering heavy loan losses. In April, the company said it turned a profit in its first quarter since emerging from bankruptcy protection.

-- U.S. to probe steering loss in Mazda, BMW: The National Highway Traffic Safety Administration is opening investigations into steering problems reported in Mazda's 3 model and BMW's Z4 sports car. NHTSA said it has received 33 complaints for the Mazda 3, and reports of three crashes tied to loss of power steering. It has received 107 complaints for the BMWs and one crash has been reported.

The probes involve more than 290,000 Mazda 3s from the 2007 to '09 model years and nearly 50,000 Z4 cars from 2003-05.

-- Va. mortgage executive pleads not guilty: Lee Bentley Farkas, the former chief of an Alexandria mortgage lender accused of scheming to steal more than $500 million from the government's financial bailout fund, on Friday pleaded not guilty in the case.

Farkas is facing charges including conspiracy and bank fraud from his time leading Taylor, Bean & Whitaker. The trial date has been set for Nov. 1.

-- From news services

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