Suzuki CEO Osamu Suzuki to Resign over Fuel-Economy Mismeasurement

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Osamu Suzuki, patriarch of Suzuki Motor Corp. and one of the auto industry’s longest-serving leaders, announced on Wednesday that he would step down as CEO to take responsibility for the fuel-economy mismeasurement scandal.

Osamu Honda, the Executive Vice President, would also resign to take responsibility for the research and development team and announce cut in compensation. Other penalties including no bonuses for board members for the year ended in March 2016, 40% compensation cut for Osama Suzuki, and 30% cut for his son for half a year.

Last month, the company admitted they used a testing method not approved by Japanese regulators. In its tests of calculating fuel economy for some of its vehicles, the company tested individual vehicle parts to estimate driving-resistance data, rather than conducting actual coasting tests required by Japanese regulations. The number of models involved in the scandal raised to 26 last week, and 2.14 million vehicles sold were influenced in Japan.

Suzuki’s mismeasurement scandal came after the similar one of Mitsubishi Motors Corp. Last month, Mitsubishi Motors Corp.’s CEO Tetsuro Aikawa, announced that he would resign for using an unauthorized testing method for twenty-five years and manipulating data.

The change of Osamu Suzuki’s position and retirement of Osamu Honda will take effect on June 29, depending on the approval of shareholders at annual meeting. The company also said that new CEO would be chosen on June 29 after annual shareholder’s meeting. Osamu Suzuki will remain chairman to prevent the recurrence of testing error while giving up the CEO title.

The company said that it would strengthen its checking systems, improving training and renew on-road test-driving course. The company also submitted the details of its measures to the transportation ministry on Wednesday.

“I apologize once again for the trouble we caused,” Mr. Suzuki said at a news conference. “This latest incident occurred because of problems within the company which had continued for a long time, including an R&D division which was not transparent enough,” said Toshihiro Suzuki, the chairman’s eldest son.

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