Suzuki HQ raided in false test probe
Authorities raided Suzuki Motor’s headquarters in Japan on Friday as investigations into the carmaker’s inaccurate fuel economy tests are underway. Investigators are looking into Suzuki’s admission that it used wrong test methods to determine the fuel economy of its minicars, which came to light last month.
The company denies that it deliberately cheated, but that it had deduced fuel economy numbers from indoor tests on individual car parts, instead of vehicle (in its entirety) coasting tests, which make the readings unreliable. Gee, you don’t need an engineering degree to figure that out. The automaker blamed the bad decision on lack of resources after the 2008 financial crisis and that it was under pressure to develop new engines and models in the late noughties.
The inaccurate testing involves 14 models sold under the Suzuki marque and 12 models under others; there were no details on what other brands have been inadvertently involved. 2.14 million vehicles – all sold in Japan – are affected, the company said. CEO Osamu Suzuki told reporters that “the company apologizes for the fact that we did not follow rules set by the country.”
Shares of the fourth largest Japanese automaker plummeted by 15% on the day that news broke. The company, however, continues to sell the affected models, saying that the actual results from approved testing methods did not actually differ greatly from those it had claimed earlier. It also does not expect any impact on earnings.
This latest in a series of cheating scandals come after Suzuki’s smaller rival, Mitsubishi Motors, admitted to overstating fuel economy of at least four of its mini vehicles. Mitsubishi Motors’ president, Tetsuro Aikawa, stepped down last month as billions of the company’s market value vanished and Nissan Motor swooped in to take over or extend a lifeline, however you see it, with a one-third purchase of the stricken company.
Since the Volkswagen cheat software was discovered last September, automakers around the world have come under scrutiny and an alarming incidences of emissions and fuel economy discrepancies have been uncovered. With stricter environmental laws and without the ease of pressure to keep sales numbers up, carmakers have been trying to outsmart regulators in various (admittedly clever) ways. Is this a sign of weak enforcement, regulations with insufficient phasing-in period or just plain greed? Or perhaps, it’s all of the above? One thing’s for sure is that we expect more deceptions to be uncovered, as authorities and environmentalists move to reveal shady automakers, in the months to come.