Mitsubishi Motors has admitted falsifying fuel economy data for more than 600,000 vehicles sold in Japan.
Tyre pressure figures were falsified by employees to flatter mileage rates, the company said. Almost 470,000 vehicles that Mitsubishi made for Nissan were affected and the issue was uncovered after Nissan found inconsistencies.
The announcement sent shares in Mitsubishi down more than 15% in Tokyo.
Company bosses, including Mitsubishi Motors president Tetsuro Aikawa, bowed deeply at the start of a press conference on Wednesday afternoon in Tokyo.
“The wrongdoing was intentional. It is clear the falsification was done to make the mileage look better. But why they would resort to fraud to do this is still unclear,” he said.
Although he was unaware of the irregularities, Mr Aikawa said: “I feel responsible.
“The inaccurate tests involved 157,000 of its own cars and 468,000 vehicles produced for Nissan.
The issue affected models including Mitsubishi’s ek Wagon and eK Space, as well as Nissan’s Dayz and Dayz Roox.