Honda’s $70 million fine: Why Early Warning Reports Rarely Detect Early Enough
Honda, the Japanese automaker, recently paid $70 million in fines due to a data entry glitch. The glitch failed to report 1,729 death and injury claims to the National Highway and Traffic Safety Administration’s (NHTSA) Early Warning Reporting (EWR) system. Honda had learned of the error from NHTSA’s office of Defects Investigation (ODI) in 2011, but did nothing to correct the error. In fairness, NHTSA did nothing to probe the automaker and didn’t impose the penalty until three years later. Now, both NHTSA and Honda are the middle of a major recall involving Takata’s exploding airbags.
Although the Early Warning Reports system should notify NHTSA of emerging defects, it typically just highlights inaction and failed recalls. NHTSA’s ODI has stated that EWR lacks the detail to monitor for safety defects. There is so much data being given that warnings do not come early enough because they have so much to sort through. Sean Kane with Safety Research and Strategies highlights three major cases where NHTSA knew early on about defects, but failed to respond: Toyota Unintended Acceleration, GM ignition switches and Takata airbags. In all three cases, NHTSA knew about defects and potential issues, but failed to do anything about it.
In the case of the Toyota, NHTSA failed to keep up with the technological advancements being made and chose to not regulate what it was unaccustomed to. In the case of GM and Takata, NHTSA cannot claim ignorance. The facts clearly show that they had the information to know that the defects were deadly, and still did nothing.
The EWR system has potential, but it really just helps prove that NHTSA really knew the problems all along and failed to act. Another flaw in the system is that incidents involving a vehicle older than ten years or a tire older than five do not have to be reported. That means thousands of vehicles on the road could have unreported defects and no one would know. The Safety Institute, a nonprofit organization founded by Sean Kane, has decided to take the data that NHTSA was unable to or failed to sort through and cumulate it into the Vehicle Safety Watch list. The Vehicle Safety Watch list helps give consumers warnings about vehicles when federal regulators fail to do so.
Although Honda was definitely at fault for failing to submit the reports fully and accurately, NHTSA should be held accountable for their lax and delayed reaction. That can be said for all these major cases. Not knowing is not its problem, failure to act is the real issue.