Mitsubishi Compensating Car Buyers $480 Million on Mileage Reporting

Mitsubishi Motors Corp. will be paying a penalty of 50 billion yen ($480 million) this fiscal year to compensate car buyers for manipulating fuel efficiency ratings.

The Japanese automaker has admitted to falsifying test data for 20 models, which have been minicars sold in Japan. The Japanese automaker said it used “desktop calculations” instead of running actual field tests and falsified data on the models sold from 2006 to this year, the company said in a statement Friday.

The company intentionally lowered resistance readings on some models, resulting in better fuel-economy ratings. The automaker state once again that it didn’t find any data falsification in models sold overseas.

Mitsubishi will compensate 100,000 yen ($959.60) to each minicar owner and will separately pay for the difference in gasoline costs and tax, Chairman Osamu Masuko said at a press briefing in Tokyo Friday. It will also pay 30,000 yen ($287.88) each to owners of five other models for which the carmaker manipulated mileage data, he said.

Mitsubishi expects Japan’s transport ministry to sign off on the recalculated fuel efficiency ratings of its minicars by the end of June, which will pave the way for the company to resume car sales. The automaker said it won’t be able to recalculate the correct mileage for older models.

The company is also assessing compensation to Nissan and suppliers, which will be announced together with its business forecasts for this fiscal year, Masuko said. Nissan purchased a $2.2 billion stake in Mitsubishi in May to stabilize the company.

Nissan and Mitsubishi have jointly developed and sold minicars. Nissan CEO Carlos Ghosn is betting Mitsubishi can contain the damage and boost the larger automaker’s standing in emerging Southeast Asian markets, including Thailand, Indonesia, and the Philippines.

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The Mitsubishi mileage scandal has damaged its brand, forced two top executives to leave, cut earnings, and motivated the company to turn to Nissan for the $2.2 billion stake. A panel of three former prosecutors is investigating the improper testing. They are scheduled to report their findings around late July.

While the Mitsubishi cars being investigated in the mileage scandal haven’t been sold in the U.S., the U.S. EPA said the company’s cars sold stateside are being scrutinized. The EPA instructed Mitsubishi to provide additional information regarding their U.S. vehicles, and was coordinating these efforts with the with the California Air Resources Board, the EPA told in April.