Honda Fined $70 Million For Underreporting Deaths And Injuries
The National Highway Traffic Safety Administration (NHTSA) has fined Honda $70 million, for according to NHTSA, "failing to report deaths, injuries, and certain warranty claims to the federal government." NHTSA says Honda failed to report 1,729 death and injury claims tied to their vehicles between 2003 and 2014, and that the company failed to submit "early warning reports identifying potential or actual safety issues." The NHTSA also claims Honda underreported warranty and customer dissatisfaction claims.
Congress limits NHTSA fines to $35 million, but the $70 million fine total for Honda was accomplished by fining the company twice: once on the death and injury claims, and another time on the warranty and dissatisfaction claims.
Honda has issued a response to the fines, and said "it has identified several shortcomings in its compliance with NHTSA's Early Warning Reporting requirements."
The AP reports that Honda said in a statement, "We have resolved this matter and will move forward to build on the important actions Honda has already taken to address our past shortcomings in early warning reporting."
The Wall Street Journal reports that under a consent order Honda signed related to the fines, the company will have to do more than just pay $70 million:
"...the Japanese auto maker will be forced to complete two audits from third parties of the company's compliance with regulatory reporting obligations. Honda will also have to train personnel on an annual basis and develop written procedures for complying with early-warning-reporting requirements, which mandate that auto makers submit quarterly reports to regulators flagging deaths, injuries and customer complaints with vehicles, among other things."
NHTSA says its issued more than $126 million in civil penalties in 2014 alone, a number "exceeding the total amount collected by the agency during its forty-three year history."
The Center for Auto Safety was one of the first organizations to raise questions about Honda's record on reporting deaths and injuries. The advocacy group sent an open letter to NHTSA in October of 2014, alleging that Honda was "not reporting all death and injury claims filed against it with NHTSA." The Center for Auto Safety's executive director Clarence Ditlow told NPR that he's happy the company is being punished, but also said, "In reality 70 million dollars is a small amount of money to a auto manufacturer, which can make billions of dollars each year in profits."
Ditlow did say he's hopeful the Department of Justice will investigate and fine Honda as well, because fines from that department can be larger than $35 million. "The Justice Department can open a criminal investigation, as it did with Toyota, which can lead to billion-dollar fines," said Ditlow. "And that's an amount of money that's enough to make even the largest auto company sit-up."
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