Honda Motor Co. has been fined a record $70 million and will be submitted to stricter monitoring by the National Highway Traffic Safety Administration.
Honda failed to disclose to the agency accurate numbers regarding warranty claims and over 1,700 injuries and fatalities that are connected to possible issues within the company's cars.
Automobile manufacturers are required to issue reports regarding such information. Honda's decision not to do so could have hindered the ability of the NHTSA to quickly identify flaws in the company's cars.
"Honda and all of the automakers have a safety responsibility they must live up to -- no excuses," said Anthony Foxx, the Transportation Secretary of the United States.
The violations of Honda were revealed last year amid investigations conducted by the NHTSA on defective airbags by the Japanese supplier Takata. The defective components could explode, sending shrapnel into the passengers of vehicles.
The escalation of the defect into a global crisis made the NHTSA doubt the diligence of car companies in reporting all vehicle issues. Honda, which was found to have underreported the cases, blamed the lapse on "inadvertent data entry or computer programming errors" which happened over a time of 11 years.
The civil penalty imposed upon Honda is made up of two separate fines that are for $35 million each, which is the maximum amount allowed. The first penalty is for the failure of the company to report a total of 1,729 injury and death claims from the years 2003 to 2014. The second penalty, on the other hand, is for not reporting repairs and warranty claims that were offered within "customer satisfaction campaigns."
Watchdog group Center for Auto Safety believes that it is still necessary to conduct a criminal investigation into Honda due to the severity of the company's violations.
Center for Auto Safety executive director Clarence Ditlow sees the penalty as an important step forward for the NHTSA. However, Ditlow thinks that the $70 million penalty is still too small an amount.
In addition to the fine, Honda will be required to revise the company's regulatory compliance methods, improve training of its personal and finish two independent audits for the company's reported data, all as part of the civil consent order Honda agreed to with the NHTSA.
Last year, successive issues in vehicles moved the NHTSA to issue more fines than in any other year, with the total reaching $126 million. This shows that the agency is taking a much tougher stance in the enforcement of its regulations.
