Wednesday, August 23, 2000
Mitsubishi admits cover-up
It failed to report customer complaints
The Associated Press and Bloomberg News
TOKYO — For years, employees at Mitsubishi Motors Corp. tucked consumer complaints about auto defects away by the dozen in a special place. That was the file known to workers as “H,” for the Japanese word for “secret” or “defer.”
The complaints by Japanese consumers were never reported to authorities — they stayed filed, awaiting clarification, explanation or documentation that usually never came.
The defects, including failing brakes, fuel leaks, malfunctioning clutches and fuel tanks prone to falling off, were fixed on a case-by-case basis to avoid any humiliating recalls.
As it announced another recall Tuesday affecting 88,000 cars and trucks, half of them in the United States, Mitsubishi acknowledged the long-time cover-up.
In documents submitted to the Japanese government, the automaker said the practice dated to 1977 and was carried out with the full knowledge of workers, man agers, even one current board member.
The revelation is a blow to the struggling automaker, which is likely to face a battle to regain consumers' shattered faith in its ethics and the quality of its vehicles. Last month, the heavily indebted automaker, Japan's fourth-largest, signed a deal to sell German-American DaimlerChrysler a 34 percent stake.
The recalls come as the automaker faces shrinking demand in its home market. The moves announced Tuesday are based on eight defects and supplement recalls announced last month on 532,000 vehicles.
The latest recall covers about 45,000 vehicles exported to the United States. Brakes may fail in the Montero sport utility vehicle because of leaking brake fluid, a gas tank weld may come loose in the Galant sedan and the Mirage may stall out because of a defective engine shaft. Mitsubishi will notify owners by mail.
Mitsubishi Motors America spokesman Kim Custer said the U.S. complaint system was separate from the one used in Japan. The U.S. sales arm had previously conducted several of the re calls that its Japanese parent is now authorizing domestically, he said.
To avert recalls, Mitsubishi contacted owners and fixed problems without reporting them.
Although no accidents linked to the defects have been reported abroad, there were at least three in Japan, Mitsubishi said.
Two were minor crashes without injury, but a brake defect in a Mitsubishi Pajero, sold as the Montero in the United States, caused it to crash into the rear of another car in June. Two people in the front car suffered minor whiplash, and Mitsubishi is looking into compensation.
Mitsubishi admits cover-up
Federated launches Green Dog brand
Fed eschews interest rate hike for now
Harrah to build office building
Industry notes: Retail
Provident expecting drop in earnings/share
Business Digest
Tristate Business Summary
What's the Buzz?
