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Honda Penalised By US Government

By raccars Published

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2014 wasn't the best year for Honda, beset with recall issues, and now the company has been fined $70 million by the US government. The fine has been levied, in part, for a failure to report more than 1,700 complaints that faults with the company's cars had caused death or injury, and in part, for failing to report warranty claims. This is the largest fine given to a car maker.

In November last year, Honda acknowledged its failure to report complaints about death and injury thanks to car faults to the National Highway Traffic Safety Administration in the US. The issue spans an 11 year period from 2003. The company discovered the problem in 2011 but failed to take any action until three years later. During the same period, federal officials claimed that Honda also neglected to report specific warranty claims and customer satisfaction issues.

$35 million of the fine is set against the failure to report death and injury complaints and the other $35 million has been charged for the warranty claims failure. In both cases, this is the maximum the Obama administration is permitted to impose. The US Transportation Secretary claims that the severity of the fines shows how seriously the government takes a failure to report safety issues to regulators.

The death and injury complaints relate to issues with defective airbags and other parts, supplied to the company by Japanese components maker, Takata Corp. More than 5 million vehicles have been recalled by Honda in the US since 2008 thanks to the fault, which can cause the rupture of air bag inflators in a crash. Occupants of the cars can potentially be injured by shards of metal because of the design fault. There have also been complaints related to braking, acceleration issues and seatbelts.

Along with the fines, Honda is also now obliged to develop a training programme and a set of written procedures, to make sure all NHTSA requirements are complied with in the future. The company claims it is undertaking a comprehensive review of its claim procedure and has now issued a country wide recall of all vehicles fitted with Takata airbags, to rectify any defects.

The US Justice Department has been given details about Honda's role in the situation and consumer watchdog organisation, the Center for Auto Safety, is pushing for Honda to face criminal charges for failing to disclose the complaints.

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