Five things to know about 'Mitsubishigate'
Tokyo, Japan - Mitsubishi says it has used non-compliant fuel economy testing methods in Japan for as long as a quarter of a century.
Here are some details on the cheating scandal:
What did Mitsubishi do, and why?
It rigged test data to understate fuel consumption readings of four mini-vehicle models sold in Japan by up to 10 percent. It says it did this to get a better fuel-consumption certification.
Executives say developers may have been pressured into cheating as rivals including Daihatsu set high fuel economy levels.
Mitsubishi used a higher speed US coasting test to measure fuel consumption, ignoring 1991 changes in Japanese regulations to use tests that better reflect stop-and-go urban driving.
In a January 2001 test, Mitsubishi compared readings using the two coasting tests, and found the difference was never more than 2.3 percent.
Which cars are affected?
Test manipulation involved 625 000 mini-vehicles produced since mid-2013: Mitsubishi's eK Wagon and eK Space, and 468 000 cars it made for Nissan, which markets them as the Dayz and Dayz Roox. All were sold in Japan.
Mitsubishi has stopped making and selling these models.
Who discovered the cheating, and what are investigators focusing on?
Nissan, which has had a mini-vehicle venture with Mitsubishi since 2011, found a discrepancy in test data in November while updating the Dayz.
Mitsubishi has set up an external committee to look into the affair. It will report in three months.
Japan's transport ministry will test the fuel consumption of Mitsubishi cars next week, and announce results on the first four models in June. It has found irregularities in fuel-consumption data on other Mitsubishi models, too, and wants an explanation by 11 May.
The ministry has also set up a task force to examine all Japanese cor companies’ fuel-consumption data.
How much could all this cost Mitsubishi?
Estimates vary and there's still uncertainty as to how widescale the cheating was. It's so far limited to Japan, where Mitsubishi sells just 10 percent of its cars.
Mitsubishi is likely to have to compensate drivers for the extra fuel used, repay government tax benefits, compensate Nissan and face potential legal suits and fines.
Nomura puts the potential bill at as much as ¥166 000 (R22 000) per car - close to $1 billion (R14.2 billion) in total.
Can Mitsubishi withstand the fallout?
Mitsubishi, which has lost around half its market value, or $3.7 billion (R52.5 billion), in little more than a week, had more than $4 billion (R56 billion) in cash deposits at the end of 2015, and relatively little debt. Its cash-flow could suffer if its bruised branding hits sales. Mitsubishi has said orders for its cars in Japan have already dropped by half.Reuters