* Dana to pay $25 mln to settle warranty claims on Tacoma
* Toyota had extended warranty due to rust damage
DETROIT Jan 12 Auto parts manufacturer Dana
Holding Corp (DAN.N) will pay $25 million to Toyota Motor Corp
(7203.T) as part of a settlement for Tacoma truck frames that
rusted out and had to be covered by warranty.
Maumee, Ohio-based Dana sold the plants that manufactured
the Tacoma frames as part of a March 2010 asset sale to
Metalsa, a subsidiary of the privately held Mexican industrial
group, Grupo Proeza.
The auto supplier said its payment to Toyota would result
in a $25 million charge to fourth-quarter earnings.
In 2008, Toyota was forced to extend the warranty terms for
Tacoma trucks manufactured from 1995 to 2000.
In 2009, the Japanese automaker recalled about 110,000
Tundra pickup trucks in cold weather states because of the risk
that exposure to road salt could cause corrosion on part of the
frame. The frame on those trucks also was built by Dana.
Toyota was Dana's second-largest auto customer in 2009, the
most-recent year for which data is available.
Toyota accounted for up 6 percent of Dana's sales from
continuing operations that year, topped only by Ford Motor Co
(F.N) at 20 percent.
Dana supplies axles, driveshafts and aftermarket parts for
autos, commercial trucks and heavy-duty construction
The company said separately on Wednesday that it expected
to post a 10 percent revenue gain in 2011, in line with the
growth projected in its global markets.
Preliminary results for 2010 showed Dana had revenue of
$6.1 billion and income from continuing operations of about
(Editing by Carol Bishopric)