By Christina Rogers
Honda Motor Co. said it failed to report 1,729 death and injury
incidents to U.S. regulators in an 11-year period starting in 2003
as results of an internal audit exposed lapses in its ability to
meet federal reporting requirements.
The figure more than doubles the actual number of deaths and
injuries involving its vehicles, bringing the total during this
period to more than 2,843--far more than the 1,114 it had initially
reported to the National Highway Traffic Safety Administration, the
auto maker disclosed in a regulatory filing Monday.
In September, Honda commissioned third-party auditors to delve
into "potential inaccuracies" in its internal tracking system for
death and injuries, after it came to light that it was
underreporting incidents to U.S. safety regulators.
Auto makers are required under the Tread Act to notify NHTSA of
all deaths and injuries involving their vehicles as "early-warning
reports." The agency can fine car companies as much as $35 million
for failing to report such incidents in a timely manner.
Honda's findings were provided to NHTSA Monday in response to a
federal special order, asking the Japanese auto maker to explain
under oath the lapses in its reporting compliance. Of the
underreported incidents, only eight were related to Takata Corp.
air bag problems, including one death which it brought to NHTSA's
attention but failed to document in an early-warning report, Honda
says.
"The audit identifies difficult facts about where we did not
meet our obligations," said Rick Schostek, an executive vice
president at Honda North America. "At Honda, we acknowledge this
problem as our management's responsibility."
Honda's safety track-record has been in the spotlight lately
amid news of its slow response to reports of exploding Takata Corp.
air bags that date back to last decade. Honda's vehicles have so
far been linked to four deaths--all involving faulty Takata air bag
inflaters.
The company is also facing numerous lawsuits involving occupants
allegedly injured or killed by Takata air bags in Honda cars that
ruptured during a crash and sent metal shrapnel flying into the
passenger cabin.
NTHSA has so far identified about 5 million Honda and Acura
vehicles affected by the Takata air bag problems.
As the result of its audit, Honda said it found data-entry
errors and lapses in its programming code that result in it failing
to capture the full scope of death and injury claims.
The company also faulted what it described as its "narrow
interpretation" of the law, causing it to disregard incidents
turned up by third-party notices, such as police reports or
information gathered by its own hired private investigators.
Because of this, it failed to submit early-reporting reports on
these incidents to NHTSA.
Honda said it is taking certain steps to improve its reporting
compliance, including correcting its computer codes and retraining
date-entry workers.
Kevin Vincent, NHTSA's chief counsel, said the agency has
received Honda's response "and will immediately begin reviewing the
documents as part of our ongoing investigation into Honda's failure
to report air bag-related injuries and deaths in a timely manner."
The agency declined to comment further.
Clarence Ditlow, executive director of the watchdog group, the
Center for Auto Safety, urged NHTSA to impose the maximum $35
million fine on Honda for the reporting infractions and refer the
case to the Justice Department for criminal prosecution.
"It strains credulity that a sophisticated company like Honda
could make so many data-entry errors, coding errors and narrow
interpretations of what's a written claim," he said.
On Oct. 15, Mr. Ditlow wrote a letter to NHTSA accusing Honda of
"systematically underreporting death and injury claims". He cited
media reports of a lawsuit settled by the company with the family
of Ashley Parham, who was killed in May 2009 when the driver-side
air bag in her 2001 Honda Accord exploded.
Separately, U.S. Sens. Jay Rockefeller and Bill Nelson (D, Fla.)
sent a letter to Takata's chairman asking for documents.
The letter outlined more than two-dozen pieces of information a
Senate committee is seeking including testing of air bags, a
10-year history on certain air bag production, a description of
capacity to build replacement parts and a description of the
destruction of documents.
"We still have many significant questions about the
circumstances surrounding Takata's manufacturing of defective air
bags and their widespread distribution and installation in vehicles
sold and driven in the United States," according to the letter.
Jeff Bennett contributed to this article.
Write to Christina Rogers at christina.rogers@wsj.com
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