Honda agreed on Thursday to pay two civil fines of $35 million each that was levied by U.S. federal auto safety regulators for failing to correctly report the number of death, injury, and certain types of warranty claims from 2003 to 2014. The $70 million total fine is the largest civil penalty imposed on an automaker.
According to an audit of Honda’s reporting system, the issue appeared to stem from data and coding errors, including flaws in how claims were entered into its case management system. While Honda admitted it first learned of the problem in 2011, it waited three years to take action.
Of fines Honda agreed to pay, $35 million — the maximum fine allowed by law — was for failure to report certain warranty claims and claims under customer satisfaction campaigns to the National Highway Traffic Safety Administration. The other $35 million was for misreporting 1,729 death and injury claims to NHTSA, or a little less than $20,243 per misreport.
An request to NTSHA for the number of unreported warranty claims was not immediately returned.
The U.S. Congress set the cap for all civil fines at $35 million. The Honda fines capped off a record-breaking year of NHTSA fines in 2014, in which it assessed more than $126 million. The Honda fine was assessed in 2014, but the company only agreed on Thursday to pay it.
Note: Southern Honda Powersports, Chapman Chevrolet LLC, and Gwinnett Place Nissan were assessed fines of $25,000, $50,000, and $110,000 respectively, but do not appear in this chart due to scale. Honda’s fine represents more than 55 percent of the total fines for 2014.
“Today’s announcement sends a very clear message to the entire industry that manufacturers have responsibility for the complete and timely reporting of this critical safety information,” NHTSA Administrator Mark Rosekind said in a statement. “The actions we are requiring will push Honda to significantly raise the bar on the effectiveness of its EWR reporting program. Our ongoing oversight will ensure compliance and determine if there is cause for additional actions.”
Correct reporting is required by the Transportation Recall Enhancement, Accountability, and Documentation Act to help identify possible vehicle flaws more quickly and thus increase consumer safety. The TREAD Act was a direct response to the Ford Explorer/Firestone tire controversy, where as many as 250 people died from tire failures.
Honda’s response can be read here.