Mitsubishi Fuso Execs Pay Cut For Coverup

TOKYO June 2, 2004; Yuri Kageyama writinfg for the AP reported that Mitsubishi Fuso Truck & Bus Corp., which has acknowledged a deadly cover-up of wheel and clutch defects to avoid recalls, cut the pay of six executives and managers Wednesday as punishment.

Twenty-three other employees were also penalized in the scandal. Four who were told to stay away from work for five days and the 19 others were reprimanded.

The Tokyo-based truckmaker, which is 65 percent owned by DaimlerChrysler AG of Germany, said in a statement that the pay cuts involved a 30 percent reduction for three months for the senior executives and a 50 percent pay cut for one day for senior managers. Mitsubishi Fuso declined to give specific figures for the pay cuts.

The company is setting up panels of academics and other outsiders to beef up quality control, but it acknowledged Wednesday that fixing the problems may take time.

"As we continue our internal investigation, we cannot deny the possibility there will be more recalls," the statement said.

Five former executives and workers of Mitsubishi Fuso have been charged in a cover-up of a design flaw that caused a wheel to fly off a truck and kill a pedestrian.

Mitsubishi Fuso, which was spun off from automaker Mitsubishi Motors in January 2003, has also acknowledged a clutch defect cover-up in a death of a driver whose truck crashed.

For years, both Mitsubishi Motors and Mitsubishi Fuso had denied the defects. But this year, Mitsubishi Fuso announced a recall of thousands of trucks for hub and clutch defects.

The image of both companies has been badly hurt by the cover-ups. The sale of Mitsubishi cars plunged nearly 60 percent in May on-year.

Mitsubishi Motors' car sales had been lagging for years in Japan because of an earlier recall scandal involving cars that emerged in 2000. At that time, Mitsubishi Motors acknowledged it had systematically hid defects for decades.

In April, DaimlerChrysler made a surprise announcement that it will not provide fresh financing for Mitsubishi Motors.

Mitsubishi Motors is embarking upon a revival plan with fresh money from the Mitsubishi group and other companies. Mitsubishi Motors owns 20 percent of Mitsubishi Fuso, and the other Mitsubishi companies own 15 percent.