Mitsubishi Fined $4.2m over Mileage Cheating by Japanese Consumer Regulator

Automotive - Pavan Pandey - Jan 30,2017

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mitsubishi fined 42m dollars over mileage cheating by japanese consumer regulator

Japan’s consumer regulator ordered Mitsubishi Motors to pay a $4.2 million (480 million yen) fine for false advertising of its automobiles sold in the home market.

Tokyo-based automotive manufacturer, Mitsubishi Motors Corporation, last year admitted to overstating their mileage readings.

In April 2016, Mitsubishi Motors Corp. admitted it had systematically falsified fuel consumption data in four models of mini vehicles, Mitsubishi’s cars with engines smaller than 660 cubic centimeters, including two sold by Nissan Motor Company Ltd., and later acknowledged that more car models were affected.

Japanese Consumer Affairs Agency said in a statement that it has imposed the fine based on evidence that the automotive manufacturer marketed the vehicles under inflated fuel economy claims. The government-run agency stated that product catalogues and websites for vehicles sold by the Japanese automotive manufacturer carried misrepresentations of their fuel economies, in accordance with a goods and services labelling law.

The agency also added in the statement accompanying its examination, Mitsubishi Motors Corp. claimed that its product presented a performance which was decidedly better than in reality to entice customers, inhabiting their capability to make buying decisions based on fact.

Over 625,000 units of these mini automobiles, extremely popular in the country due to their lower fuel consumption and small size, were sold in the archipelago under the false claims. The fine includes models since the rule was revised in the month of April, including the eK wagon minicar, the similar Dayz model manufactured for Nissan Moto Co. and the Outlander SUV.

In a separate statement, Mitsubishi Motors Corp. said that the company had received the charges order and will respond after examination.

Mitsubishi Motors Corp. is struggling to recover from the cheating scandal and believes in posting an operating damage this year due in part to costs arising from the falsifications. Mitsubishi’s market value has plunged since the scandal broke in April, and the trial prompted the automaker to seek financial backing from Nissan Motors Co., which bought a controlling one-third shares for $2.2 billion.