The National Highway and Traffic Safety Administration
(NHTSA) recently imposed a $70 million fine against Honda for underreporting crucial
information to federal officials. It is the largest civil penalty imposed
against an automaker, according to
The New York Times.
Knowledge is power for any consumer. If your vehicle has a problem that
could result injuries or death, you most definitely want and need to know
about it. Government regulators also need to know about the problem so
they can set guidelines and ensure automakers are in compliance. Likewise,
federal law requires automakers to timely and routinely disclose problems
to auto safety regulators, called Early Warning Reporting
(EWR). Under the
Transportation Recall, Enhancement, Accountability and Documentation
Act (2000), manufacturers of 5,000+ vehicles must report to NHTSA any “claims”
or “notices” that they have received that “alleges or
proves that the death or injury was caused by a possible defect in the
49 C.F.R. § 579.21(b)(1). The obvious purpose of this requirement is to promote consumer safety.
But from mid-2003 to mid-2014, Honda didn’t report over 1,700 complaints
of injuries and deaths, in addition to claims about warranties and customer
NHTSA’s Press Release. NHTSA fined Honda $35 million for violating reporting requirements for
injuries and deaths, plus another $35 million for violating reporting
requirements for warranties and satisfaction. (Current law limits fines
to $35 million per violation, but
The Washington Post and
The Wall Street Journal report ongoing efforts for Congress to significantly increase this amount.)
What’s troubling is that Honda had reason to know as early as 2011
of its underreporting, but it didn’t disclose to NHTSA until September
2014, according to
New York Times. It’s speculative, but this significant delay may have resulted
in higher rates of injuries and other issues. Also, Honda’s troubles
may just be beginning - civil lawsuits and even a potential
criminal investigation by the U.S. Department of Justice could follow. It remains to be seen
how this will impact Honda’s established reputation for popular
and reliable vehicles.
There’s no such thing as infallible technology, and the auto industry
can’t be held to standards of perfection. But as consumers we should
be able to trust our automakers and have peace of mind while on the road.
We also need to be informed of crucial information, like potential risks
and dangers, so we can make informed decisions. The auto industry owes
it to the public to be candid about its products, proactive in preventing
and fixing problems, and establishing consumer safety as the number one priority.