The fine, the maximum under law, could hurt Toyota Motor Corp.’s image more than its financial bottom line: The penalty is the equivalent of a little more than $2 for every vehicle the company sold around the globe in 2009. And analysts said it would have little impact on dozens of private lawsuits, which have been combined before a federal judge in Santa Ana, Calif.

“In the court of public opinion, paying the fine speaks volumes. But at the end of the day, the fines are simply background noise in terms of the civil litigation,” said Richard Arsenault, a plaintiff’s attorney in Alexandria, La. “What’s really important are the facts that were the catalyst for the fines.”

Addressing new safety concerns, Toyota said it would recall all 9,400 of the 2010 Lexus GX 460s that went on sale in late December – 5,600 that have been sold and 3,800 still at dealers or elsewhere in the distribution pipeline. The announcement came less than a week after Consumer Reports issued a warning about the SUVs, a sharp contrast to the government’s contention that Toyota took four months to order its huge recall of other models over sticking gas pedals.

For the Lexus recall, Toyota said dealers would update software in the stability control system, which is supposed to help prevent rollovers. Toyota already had halted sales of new GX 460s and begun tests on all of the company’s other SUVs.

The government accused the company of hiding the earlier defects involving gas pedals, a contention Toyota rejected though it agreed to pay the fine.

Transportation Secretary Ray LaHood said Toyota “put consumers at risk” by failing to promptly notify authorities about potentially defective accelerator pedals on 2.3 million vehicles. LaHood said Toyota knew about the problem in late September but didn’t issue the recall until late January, violating a federal law that requires an automaker to notify the government of a safety defect within five business days.

“They did not disclose within five days that there was a problem. They didn’t disclose it for several months, so we fined them the maximum amounts and they decided to pay it and that means they knew they did something wrong,” LaHood told reporters in St. Louis. “They did try to hide it – that’s what we accused them of – and they’ve agreed to that.”

Toyota said it agreed to the fine to avoid a lengthy legal battle but denied the government’s allegation that it broke the law. In a statement, Toyota acknowledged %

A Huntington Beach police officer checks out an SUV that winds blew onto its side in the parking lot of Peter’s Landing Marina in Huntington Harbour. No one was in the vehicle when it tipped over.

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Following last week’s surprise announcement that Sichuan Tengzhong Heavy Industrial Machinery and GM had reached an agreement, analysts and Chinese media were buzzing with talk that the two companies might have jumped the gun.

Reuters newsagency says the pitfalls range from regulatory to financing issues.

GM said a day after its bankruptcy filing that it did not expect any regulatory scrutiny from the US government on the deal, part of its attempt to restore profits by focusing on four core brands: Buick, GMC, Cadillac and Chevrolet.

According to Reuters many China watchers say that resistance could actually come from China itself, as Beijing pushes for development of more energy-efficient technologies that go contrary to Hummer’s lineup of big SUVs.

As the world’s second-largest energy user, China is trying to encourage its citizens and industry to be more fuel efficient to lower its energy bill and improve its environment.

The Hummer deal may also not get government approval as Beijing is not encouraging its carmakers to make foreign acquisitions, the official Shanghai Securities News reported, citing people with knowledge of the matter.

“Some people may have views and speculation but the Chinese government has a process that we respect,” the Tengzhong official said.

“We have only just signed an MoU (Memorandum of Understanding), but as we develop our proposals with GM and Hummer we will continue to work with the appropriate authorities.”

Some analysts said Chinese leaders may also be reluctant to let a company with no experience running an overseas operation take on such a high profile and risky acquisition.

“Obviously, Tengzhong is not a well-established company, and its business doesn’t fit well with Hummer, so the deal looks tricky,” said Jeffery Wang, Shanghai-based managing director of investment bank Business Development Asia.

“Apart from that, buying Hummer should be a poor business decision in the long run, as … I don’t think Tengzhong has the ability or resources to turn the business around. … I don’t think any banks would be willing to fund the acquisition by a company without a solid background.”

Tengzhong was in advanced talks with banks, a spokeswoman from Tengzhong told Reuters.

“However, as you would appreciate, the funding can’t be finalized prior to a definitive agreement being signed,” she said.

Little is know about Tengzhong, which is based in the Chinese province of Sichuan, other than it makes special-use vehicles, highway and bridge structural components, construction machinery and energy equipment.

Tengzhong was formed in 2005 through a series of mergers and, according to its Web site, has 4800 employees.

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Specializing in heavy industrial and construction machinery, Tengzhong is based in the Schuan province and should have the deal wrapped up by the third quarter of this year.

Although the exact details and amount of money changing hands with regards to the deal are still secret, Credit Suisse is representing Tengzhong whilst America’s Citi bank is acting as financial advisor to GM.

Hummer’s 150 US dealers are expected to survive, yet with its unbundling from the GM stable, new manufacturing facilities will be needed, with the Shreveport, Louisiana plant (responsible for H3 and H3T) still on contact until the end of next year.

GM’s South African manufacturing facility in Port Elizabeth, which built right-hand drive H3s, is in the process of shutting down Hummer production.

AM General’s Mishawaka plant, located in Indiana, faces an uncertain future as it produces the oversized H2 Hummer derivative.

Although US workers will be glad the brand’s core management and dealership network remains, Oriental analysts are at a loss trying to understand the value of the deal. Tengzhong has no experience in the car industry and Hummer is a poisoned chalice of sorts in a world turning away from brash, inefficient, SUV vehicles.

One of the deal sweeteners is a long-term GM supplier agreement for Tengzhong, which could perhaps offset a loss-making Hummer purchase against high revenue supply contracts.

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VEHICLE MAKE/MODEL: 2009 HUMMER / H3T

NHTSA CAMPAIGN ID Number: 09V080000

Summary:

GENERAL MOTORS IS RECALLING 1,738 MY 2009 HUMMER H3T VEHICLES. SOME OF THESE VEHICLES HAVE A CONDITION IN WHICH THE FUEL TANK FRONT SUPPORT STRAP MAY FRACTURE. IF THIS OCCURS, THE FUEL TANK WOULD BE SUPPORTED BY THE REAR SUPPORT STRAP AND STONE SHIELD ONLY. CONTINUED USE OF THE VEHICLE MAY EVENTUALLY FRACTURE THE REAR SUPPORT STRAP AND SHIELD FASTENERS.

Consequence:

THE FUEL TANK COULD SEPARATE FROM THE VEHICLE INCREASING THE RISK OF A CRASH.

Remedy:

DEALERS WILL INSTALL A NEW-DESIGN FUEL TANK FRONT SUPPORT STRAP FREE OF CHARGE. THE RECALL IS EXPECTED TO BEGIN ON OR BEFORE APRIL 10, 2009. OWNERS MAY CONTACT HUMMER AT 800-732-5493 OR OWNER CENTER AT WWW.GMOWNERCENTER.COM.

Notes:

GENERAL MOTORS 09048. OWNERS MAY ALSO CONTACT THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION’S VEHICLE SAFETY HOTLINE AT 1-888-327-4236 (TTY 1-800-424-9153), OR GO TO HTTP://WWW.SAFERCAR.GOV .

The Cadillac Escalade in the commercial is a hybrid model. Automotive.com reports the 2009 Cadillac Escalade Hybrid Sport Utility at 21mpg highway and 20mpg city. The base model Escalade gets a dismal 14mpg highway and 10mpg city. Anything is an improvement over that. Regardless, fuel economy in a luxury SUV is an oxymoron.

The voiceover in the commercial simply states that the comparison is made against a MINI Cooper, but doesn’t clarify which model. However, in the hardly legible fine print that briefly rests at the bottom of the screen you might notice that the MINI Cooper they Cadillac compares it to is the Cooper S, which is MINI’s turbocharged model. But Cadillac doesn’t want you to know this. You are led to believe it’s the regular economy car. Regardless, according to Automotive.com, the 2009 MINI Cooper S Hatchback gets 34mpg highway and 26mpg city. Unfortunately, Automotive.com does not have the mileage listed for the convertible model, but MINI’s site claims the same fuel efficiency with a 2-3mpg difference between manual and automatic transmissions. The base model gets 37mpg highway and 28mpg city! Obviously Cadillac wouldn’t compare their hybrid’s gas mileage to that fuel economy.

You also need to take into account that the Escalade Hybrid has a sticker price of over $75,000 – $80,000. The Cooper S, on the other hand, has a sticker price of under $24,000. If you really want to compare apples to oranges as GM did in their commercial, without the blatant lying, there is also a platinum edition (non hybrid) Escalade that is over $80,000. You could almost buy four base model MINI Coopers for that price, as pointed out in the comments here!

Green living blogger Max Gladwell found on his test that the Cadillac Escalade Hybrid, driven around Beverly Hills, CA got only 10.3MPG (see below) during their five mile journey! On what planet is that better than the 26mpg the MINI Cooper S gets in the city?

Now, I’m not a MINI owner, so I was curious as to what comments from true enthusiasts about this blatant false advertising would look like – check out five pages worth at NorthAmericanMotoring.com!

The suggestion comes as Patrick prepares to unveil a fuller version of his much-awaited transportation plan on Friday. While he would not release details today, Patrick said at a Greater Boston Chamber of Commerce appearance that any gas tax increase would be coupled with a freeze on toll rates.

Environmentalists applauded the registration proposal, saying it would encourage people to buy smaller and more fuel-efficient cars, which are increasingly seen as key to curbing global warming. Similar proposals have been proposed in Massachusetts since at least 2001, but without the prominent backing of a sitting governor.

“The social costs of larger vehicles include not only the additional pollution, but also higher crash risks to other vehicles,” said Representative William Brownsberger, a Belmont Democrat who is cosponsoring two bills in the Legislature that would penalize expensive and heavy cars with higher taxes or fees.

But opponents say such fees could penalize families and small businesses who need big cars or trucks and already pay higher fuel prices. And at least one influential player in the transportation debate worries that adding an environmental component to the debate could complicate it, and ultimately delay important plans to fix the state’s broken road and public transit system.

“There’s painful steps that need to be taken to fix our transportation system,” said Stephen J. Silveira, a lobbyist who chaired the Massachusetts Transportation Finance Commission. “Once you bring the environmental aspect into them, you add a whole other layer of debate which makes this harder to get to at the end of the day. And this is hard enough.”

Patrick said today that his administration is looking at the Registry of Motor Vehicles fee structure to create “differential fees based on the efficiency of the vehicle or the emissions of the vehicle.”

“Big gas guzzlers will pay more for their registration,” he added. “Plug-in hybrids would pay less and you’d have a range, that kind of thing.”

Patrick’s office declined to elaborate on the proposal or say whether it would appear as part of his overall transportation plan. RMV spokeswoman Ann Dufresne said state transportation officials have been discussing a gas guzzler fee program, “but I think they’re still trying to flesh that out now.”

Patrick said today that he was continuing to look at raising the state gas tax, but did not commit to it. When asked about it during the Chamber event, he threw the question back to the audience, asking by a show of hands whether the crowd favored a gas tax increase or a toll hike. The crowd chose the gas tax, which has generally been a more popular proposal in the business community.

But Patrick cautioned that even if lawmakers raise the gas tax rate, the state would probably collect less money in the future as drivers buy more fuel-efficient cars and need less gas. Because of that, he is also considering a replacement that would charge drivers a fee for every mile they drive.

That’s another reason environmentalists support the Hummer tax. If the gas tax is eventually phased out, a new fee would keep the pressure on consumers to buy more fuel-efficient cars.

“It allows for technology to evolve every year because it’s always taxing the most polluting and it’s always incentivizing the most efficient,” said Matt Elliott, a clean energy advocate for Environment New Jersey, where the idea is also being debated.

The federal government already has a gas guzzler tax on new cars, passed in 1978. But sport utility vehicles and trucks are exempt, so it affects mostly high-performance luxury vehicles such as Aston Martins and Lamborghinis that have high costs and very poor mileage. Any car that gets more than 22.5 miles per gallon — the vast majority of sedans and coupes — is exempt.

A state fee on gas guzzlers that includes SUVs and gives rebates to drivers of plug-in and other high mileage cars has been proposed in other states, including California, but has yet to pass, according to Charles Territo, spokesman for the Alliance of Automobile Manufacturers, which represent 11 car companies, including the big three American carmakers. Territo warns of unintended consequences on families and small businesses and points out that low-mileage cars are already priced below big cars in most cases.

“Consumers that have these vehicles already pay more,” said Territo, who said his group would oppose such a plan in Massachusetts.

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