Photographer: Krisztian Bocsi/Bloomberg

Volkswagen to Audit Compliance With U.S. Death-Reporting Law

  • Stout Risius Ross analysis earlier showed VW reports lagging
  • Company will work with U.S. regulators on recommendations

Volkswagen AG, which reported death and injury claims at the lowest rate of any major automaker in the U.S. in the last decade, agreed to an independent audit of its compliance with a law requiring timely reporting of those claims.

The company will coordinate with the National Highway Traffic Safety Administration, make the findings available to NHTSA and work with the agency on any recommendations, said Jeannine Ginivan, a VW spokeswoman, in an e-mailed statement Friday.

The average reporting rate of the 11 biggest automakers during the past decade was nine times higher than Volkswagen’s, according to an analysis of government data by financial advisory firm Stout Risius Ross Inc. at the request of Bloomberg News. To ensure fair comparisons among carmakers of different sizes, the rates were calculated per million vehicles on the road. The automakers’ average was 306 per million, compared with 34 for Volkswagen.

The reporting system “is a way for NHTSA to get the information it needs to make timely decisions on recalls,” said Clarence Ditlow, executive director of the Washington-based watchdog Center for Auto Safety. “In Volkswagen’s case, it appears the underreporting is sufficient to require a fine.”

Safety compliance issues would be an added challenge for Volkswagen as it scrambles to respond to fallout from its admission last month that it purposely cheated on U.S. diesel-pollution rules. The automaker faces regulatory investigations in the U.S., Europe, Japan and China and a criminal probe in the U.S. related to the emissions cheating.

“In discussions with Volkswagen officials, NHTSA requested that VW perform a third-party audit as part of its effort to ensure compliance with safety reporting requirements,” Gordon Trowbridge, a spokesman for the agency, said in a statement. “The agency welcomes VW’s commitment to do so and will continue to coordinate with VW and other manufacturers to ensure that such reporting helps us in our mission to protect the traveling public.”

Honda Fined

This year, two of Volkswagen’s competitors, Honda Motor Co. and Fiat Chrysler Automobiles NV’s U.S. unit, have said they underreported claims to the U.S. government, and Honda paid a fine.

In January, Honda was fined a record $70 million for underreporting to the same NHTSA database. Fiat Chrysler’s U.S. unit last month said it violated the requirements of the same law. Both companies were reporting at a rate at least twice that of Volkswagen, according to the Stout Risius data compiled for Bloomberg.

NHTSA approved Rodney Slater, former U.S. transportation secretary, as an independent monitor for Fiat Chrysler, the automaker said Friday.

In July, Fiat Chrysler agreed to pay a record $105 million penalty after a government investigation into how the company handled 23 recalls involving more than 11 million cars and trucks. As part of that accord, Fiat Chrysler said it would hire an independent monitor to ensure it no longer delays safety recalls.

NHTSA is focused on improving the system of reporting potential defects, both through monitoring automaker reports and making its analysis of the data more effective, Trowbridge said. The agency is implementing recommendations of an audit by the Transportation Department’s inspector general, including more actively following up on fatality reports and lawsuits and is seeking additional funding for more staff, he said.

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