Mitsubishi finally announced its compensation scheme on Wednesday after complaints have been flooding in from China over the last three weeks.
This is the first time the word "compensation" has been used by the company.
Since the State Administration for Exit-Entry Inspection and Quarantine banned the import of Pajero V31 and V33 -- two types of cars produced by Mitsubishi which were found to have serious safety flaws -- the Japan-based auto company has been evading the question of compensation.
The compensation scheme has been based on the suggestions of the China Consumers Association, according to Wang Qianhu, director of the association's Legal Affairs and Complaints Department.
The company had previously said that owners of Pajeros V31 and V33 could get their cars repaired at its special maintenance stations.
In the scheme it publicized on Wednesday, Mitsubishi stated that repair expenses would be exempted. It also promised it would pay for all expenses involved in the whole repair process, including transport, board and lodging expenses.
If cars with safety flaws are not repaired within three hours, the company will pay for car hire for consumers.
It will carry out a thorough investigation into each complaint, and if an injury is proved to be caused by the safety flaw, it will pay compensation in accordance with the relevant provisions of the Law on the Protection of the Rights and Interests of Consumers, the company claimed.
Consumers who bought V31s or V33s for personal use and through "a legal channel" can return the car if necessary, the scheme points out.
The China Consumers Association confirmed the significance of the compensation scheme in a telephone interview with China Daily.
"The scheme has been drawn up in accordance with facts and laws. I am pleased Mitsubishi is acting in accordance with Chinese laws," said Wang Qianhu.
But Wang declined to say that the association was "satisfied," adding that they would keep a check on the company to make sure it fulfilled its promises.
Last Friday, the company agreed to give 120,000 yuan (US$14,000 ) to Lu Hui, a resident in Changsha, capital of central China's Hunan Province, for medical expenses.
In late December, Lu was walking on the pavement and was knocked down by a Pajero V31 cross-country car which lost control because of the inefficiency of the brake system.
Lu is still unconscious in hospital. Her family pays 2,000 yuan (US$241) a day for treatment, but doctors say the chance of her survival is only 40 percent.
As well as Lu's case, consumers' associations across the country have received dozens of similar complaints.
Mitsubishi has been flooded with complaints worldwide for its flawed braking systems in some of its models since last year.
(China Daily 03/02/2001)
