Feds fine Honda $70M for unreported safety problems

Chris Woodyard | USA TODAY

Federal auto safety regulators said Thursday that they are assessing a total of $70 million in fines against Honda for violating federal safety reporting requirements.

The National Highway Traffic Safety Administration says the two $35 million fines also come with Honda's agreement to increase NHTSA oversight and enhance its third-party audits to make sure its reporting is current in the future.

The two fines were set at the maximum amount that NHTSA is allowed to assess by Congress for safety reporting violations.

NHTSA said the first fine relates to Honda's failure to report 1,729 death and injury claims to NHTSA from 2003 to 2014. Honda has previously disclosed the undercount, saying that its own investigation found that it misinterpreted what issues should be counted.

The second civil penalty involves Honda's failure to report certain warranty claims and claims under "customer satisfaction campaigns," in which a manufacturer quietly agrees to fix defects on cars even when they are outside the normal warranty period, over the same number of years, NHTSA said.

The two fines do not directly relate to the scandal over automotive air bags made by Japan's Takata. Honda has been at the center of the issue involving air bags that can injure or kill passengers when they deploy, along with nine other automakers. But Honda has said the audit total includes eight Takata air bag failures involving one death and seven injuries. It says NHTSA already was informed of these incidents through other channels.

The fines show NHTSA, an agency under the Transportation Department, is getting tougher on automakers, officials say.

"Honda and all of the automakers have a safety responsibility they must live up to, (which is) no excuses," said U.S. Transportation Secretary Anthony Foxx in a statement.

In a statement Thursday, Honda said it is moving ahead after the fines.

"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," says Rick Schostek, executive vice president for Honda North America, in a statement. "We continue to fully cooperate with NHTSA to achieve greater transparency and to further enhance our reporting practices."

In May, NHTSA slapped General Motors with a single $35 million fine for late reporting on ignition-switch defects in older Chevrolet Cobalts. Millions of cars with the switches have been recalled and GM is paying compensation for accidents blamed for them that have caused more than 40 deaths. The fine was part of the $126 million in civil penalties that NHTSA says it assessed last year, a record. The agency says the total exceeded the total amount collected by the agency during its forty-three year history.

When the Justice Department became involved in cases, the settlement amounts grew. The Justice Department announced a $1.2 billion penalty against Toyota in March arising from its unintended acceleration cases that led to recalls of 8.1 million vehicles.

"These fines reflect the tough stance we will take against those who violate the law and fail to do their part in the mission to keep Americans safe on the road," Foxx said.