My experience with LC ‘transponder’ keys: I bought a 98 about a month ago from a private party. It came with one black key and a separate Toyota Remote. The LC owner’s manual shows the master key to be black (along with the built-in remote) while the Valet key is gray. This led me to believe that the key I had was indeed a master key, but without a built-in remote.
Not wanting to chance the possibility of losing my one key, I checked around in my area (Phoenix, AZ) and found a locksmith that offered to cut and program two keys at a cheaper price than the Toyota dealer ask for a single key. But after two 30 mile trips to his place of business he informed me the new key he made would not program and he had no idea why. He assured me that my key was a master, but for some unknown reason he could not program in a new key. He even went through the procedure whereby all programming, except for the one in the ignition lock, was erased.
I searched the Internet to see what my options were and ran across a Webpage hosted by Locksmith Charley. This is an interesting page with much info on transponder keys. He also made the claim that he had the equipment to dump all key programming in the ECU and could start from scratch. I was greatly encouraged to find that Locksmith Charley’s place of business is in Phoenix. So with high hope, off I went to see what he could do.
Charley is a interesting gentleman, and seems very knowledgeable about not only locks and keys, but also computers and electronics. He first tried to program a new key for me but ran into the same problem as the previous locksmith. His only suggestion was to dump all programming and start over. His cost for this procedure is $150. Having no other choice, I agreed. He then went to my LC, dropped the glove compartment, removed some brackets and popped out the ECU. In his shop he removed the ECU cover and connected a little dip-clip to what I assume was an 8-pin flash-memory chip. The dip-clip was connected to a small electronics box that interfaced to a computer. In a matter of minutes he cleared the memory in the ECU, re-installed it and programmed me two additional master keys and one valet key. He also threw in one of the master key at no cost. My total outlay for three keys was $225---a little more than I wanted to pay, but probably worth it.
I found no information on the Internet about Toyota’s program to offer a new ECU. Not that it would have done me any good since I did have one working key. (How could I claim “all keys lost” for free ECU if I were able to drive to the dealer?) But even so, I probably did as good, cost wise, dealing with Locksmith Charley.