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- Suzuki plans to remember about 2 million vehicles after cheating on safety tests, filing fake fuel efficiency reports and failing to conduct proper inspections.
- Japan's third-largest carmaker expects to see a single loss of 80 billion yen ($ 9.9 billion), a large chunk of projected net income of 220 billion yen ($ 28 billion) for the year ended 31 December. March.
- Suzuki investigated its factories and found evidence of defective brake checks, tampering with data and inspections being conducted by non-certified employees – assistant inspectors still in training.
- The recall of Suzuki follows similar incidents in Japanese rivals Nissan and Subaru.
- Visit the Business Insider homepage for more stories.
Suzuki plans to recover about 2 million vehicles in Japan after admitting that it has betrayed safety tests, submitted false reports of fuel efficiency and failed to carry out adequate inspections.
Japan's third-largest carmaker – which sold 714,000 units last year – will get back domestic vehicles sold since April 2016 that did not receive a mandatory checkup by the government. The company expects to record a one-time loss of 80 billion yen ($ 9.9 billion) as a result – a large chunk of its projected annual net revenue of 220 billion yen ($ 28 billion).
An internal investigation of Suzuki's factories found evidence of braking checks, tampering with fuel efficiency data and inspections being conducted by non-certified employees – assistant inspectors still in training.
President Toshihiro Suzuki said that there was likely to be "inappropriate confirmation of compliance with Japanese vehicle safety standards" – in other words, inspectors falsified the test results. He promised that executives would accept a pay cut as punishment, according to the Nikkei.
"We believe that Japanese automakers like Subaru and Suzuki are trying to extract additional volumes from their plants in Japan instead of expanding production," Janet Lewis, an analyst at Macquarie Securities, said in a research note. "This effort to sweat the assets in Japan seems to have resulted in cutting the corners in the inspection process."
While there have been no reports of problems with vehicles that have not been properly inspected, the scandal "is raising questions about confidence in Japanese car manufacturing," he added.
The recall could affect up to 25 car models, including some made for Mazda and other automakers, according to the Nikkei. Suzuki will reduce the speed of its production line by 2% to 5% to allow proper inspections, plus overtime and weekend work to maintain production. Also worth 170 billion yen (R $ 21 billion) for investments in quality and safety over the next five years, according to Nikkei.
The recall of Suzuki will not shock followers of the Japanese auto industry. Nissan collected 1.2 million cars in Japan last October after discovering that uncertified technicians were conducting final vehicle inspections.
Nissan – owner of the Infiniti and Datsun brands – picked up another 150,000 domestic vehicles in December after checking for brakes, steering, speed measurement and vehicle stability. In July, it admitted that emissions and fuel economy tests at most of its Japanese factories did not meet government standards.
Likewise, Subaru announced its biggest recall of all time – 2.3 million vehicles worldwide, including 300,000 in Japan – in February, citing a problem with the brake lights.
Increasing sales of cars and motorcycles raised Suzuki's net sales by 4% to ¥ 2.8 trillion in the nine months to December 31, raising net profit by 10% to ¥ 181 billion, second the third quarter. results presentation.
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