Japanese automaker Toyota (TM) announced that it has agreed to pay a record $32.4 million in further fines to the U.S. government to settle an investigation into the way it handled recent recalls.

The company's board of directors agreed to the fines Monday at its board meeting in Japan, and it will not admit to any violations of U.S. laws. Unfortunately for Toyota, this move will not exempt the company from potential civil and criminal penalties in private lawsuits and other federal investigations.

During uncertain economic conditions, it's best to consider investing in a demonstrated business model or two, and auto parts chain Advance Auto Parts (AAP), first discussed here on May 19, 2009 at a price of $43.38, is one.

Advance Auto's 2010 sales will likely increase 5-7% in 2010, followed by a 4-6% gain in 2011, boosted by the opening of about 150 new stores. Same store sales should increase 4-6% in 2010.

Also, margins should increase, aided by efficiency improvements, and market-appropriate prices.

AutoZone (AZO) is working today while just about everything else isn't (seems that way, at least). With the Dow comfortably below 10,000 (unfortunate phraseology, to be certain), the car-related stock is up 4% to $191.64 as of this writing. Volume is very good.

That is not far at all from the 52-week high of $193.74. Furthermore, the company's chart looks mighty tempting. It says to an investor, "Buy me!" It says the same thing to a trader, too. This is a situation where momentum appears to be an attractive alternative to all the ugly volatility.

President Obama is expected to issue an executive order to raise fuels standards for light trucks. Rather than wait for Congress to hash out the issue, Obama is using his executive power to raise the fuel efficiency standards and cut CO2 emissions by cars and light trucks beyond current requirements.

Issuing an executive order to raise fuel efficiency is easy; implementation is going to be the tough part. As General Motors, Ford (F) and Chrysler strive to implement new fuel efficiency standards, there are many tough decisions they will have to make.

It was not that long ago that Toyota Motor Corp. (TM) was known for the safety of its vehicles, but the past year has been a nightmare for the Japanese automaker. And things took a turn for the worse Tuesday when it was forced to suspend sales of its Lexus GX 460.

The decision to suspend sales of the Lexus SUV came after Consumer Reports hit the model with a rare "Don't Buy" rating due to rollover concerns.

Toyota Motor Company (TM) has definitely been feeling the impact of its current recall crisis. The company that once had a strong reputation for safe and reliable cars has seen that image tarnished, and the effects are being felt on the company's dealer lots.

February was a tough month for the company, and concerns over the safety of the company's vehicles led to a reported 8.7% dip in sales last month.

AutoZone (AZO), a distributor of replacement items for motorized vehicles, posted a very good second quarter on Tuesday. Net sales increased 4%, and earnings per diluted share went into high gear, rising over 21% to $2.46. According to our earnings preview, the analysts were expecting only $2.34 per share.

Gross margin experienced an expansion, as did the return on invested capital metric (the latter being measured over the trailing four quarters). Both of these developments indicate that execs are skillfully managing the underlying fundamentals of the business. Domestic same-store sales didn't rise as robustly as they did back during the first quarter, moving up only 1%. I would have liked to have seen a better stat on that one, but overall, I'm not going to complain too much, unless I detect a weakening trend in coming months.

The recent massive safety recalls by Toyota Motor Company (TM) have definitely hurt the company's image, and the uncertainty over the current safety of its vehicles has left many people wondering what exactly is going on with the Toyota recall. If people were concerned before, they are sure to be a bit more confused after a Toyota executive testified in front of the House Energy and Commerce Committee today that the recall may not "totally solve" the current problems.

Last week Toyota's president, Akio Toyoda, was asked to come before Congress and testify over the current safety recalls. Mr. Toyoda will answer questions tomorrow, but today it was James E. Lentz III, the president of Toyota Motor Sales U.S.A., that had his chance to answer questions in front of Congress.

The stock of The Goodyear Tire & Rubber Company (GT), which I first wrote about on May 5, 2009, at a price of $13.30, has given back most of the gains registered in 2009, but I still like the company's business model and prospects, for several reasons.

First and foremost, it appears the long auto sector depression in the U.S. is over: miles driven fell substantially in 2009, due to fewer drivers and consumer belt-tightening. Further, while no one should expect 1960s-style suburban traffic growth, last year's negative mileage pattern is unlikely to be repeated in 2010.

Can any fuel form make a serious run at oil use in the U.S. in the decade ahead? Natural gas might -- largely as a result of natural gas' abundant domestic supply, if new drilling techniques are deemed environmentally safe.

Briefly, the new techniques -- including one called 'hydraulic fracturing' -- enables natural gas suppliers to profitably access more gas than before. As a result, the Potential Gas Committee says the United States now has a more than a 100-year supply of natural gas.

The Copenhagen Summit sometimes gives observers the impression that elaborate formulas and systems are needed to reduce greenhouse gases.

And, to be sure, a cap-and-trade system (or an equivalent) at the national level, and then coordinated at the international level, will be needed to ensure that nations are reforming their climate changing ways.

However, the above does not mean substantive greenhouse gas reductions cannot occur outside of the Copenhagen framework. They can, and one obvious way is: reduce the weight of vehicles.

Advance Auto Part's (AAP) stock has retreated about $7 since mid-summer, but I'm nevertheless reiterating my buy rating for the company, first recommended on May 19, 2009 at a price of $43.38. Here's why.

Advance Auto's stock appears to be the victim of some tad-early, year-end, profit-taking by short-term institutional investors (IIs). AAP posted Q3 EPS of 65 cents -- very close to the First Call Q3 EPS estimate of 66 cents; AAP also reported a 4.7% increase in same store sales in Q3. The two data points helped AAP recover slightly from its $47 to $37 swoon, with shares now trading at/near $39.50, supporting the analysis that the preceding plunge has the look of selected institutions 'getting out, early' ahead of the December crush.

American auto maker Ford Motor (NYSE: F) gave investors a reason to smile this morning when it posted a surprising $1 billion profit for its third quarter.

Going into this morning's earnings release, analysts had expected to see the Dearborn, Michigan-based auto manufacturer to lose 12 cents per share. But Ford had other ideas, posting a profit of 29 cents per share, or $997 million.

It should not come as too big of a surprise, but American auto maker Ford Motor (NYSE: F) announced today that its sales fell by 5.1% in September.

Following this summer's widely popular "cash for clunkers" program, it was some what expected that demand would weaken during September as so many people had just recently purchased new cars to take advantage of the government program.

CarMax Inc. (NYSE: KMX) rallied to a new 52-week high Tuesday after topping analysts' second-quarter earnings expectations. The used-car retailer reported a quarterly profit of $103 million, or 46 cents per share, while net sales jumped 13% to $2.1 billion. By contrast, analysts were expecting net income of just 18 cents per share on $1.77 billion in revenue.

"The government's CARS, or 'cash for clunkers,' program resulted in a spike in traffic in late July and August," explained CEO Tom Folliard. Same-store used-unit sales for the quarter climbed 8%, bouncing back from a 17% drop in the first quarter.