Fiat Chrysler Agrees to 3-Yr NHTSA Oversight after Mishandling 23 Vehicle Recalls
July 31, 2015
For the next three years, Fiat Chrysler will be subject to “unprecedented oversight” from federal transportation regulators at the National Highway Traffic Safety Administration (NHTSA). This oversight is part of a greater enforcement action the NHTSA has imposed on Fiat Chrysler as a result of how it mishandled 23 vehicle safety recalls impacting more than 11 million of its vehicles in the U.S.
“[This] action holds Fiat Chrysler accountable for its past failures, pushes them to get unsafe vehicles repaired or off the roads and takes concrete steps to keep Americans safer going forward…This civil penalty puts manufacturers on notice that the Department will act when they do not take their obligations to repair safety defects seriously,” U.S. Transportation Secretary Anthony Foxx explained in a recent press release.
A Look at Fiat Chrysler’s “Past Failures”
Fiat Chrysler has been found to have violated the Motor Vehicle Safety Act, a statute that requires automakers to promptly report and address vehicle safety issues (among other things). In fact, following a July 2nd hearing during which NHTSA officials specifically detailed the ways in which Fiat Chrysler mishandled various vehicle recalls, the automaker admitted to having violated the Act in three ways:
- Failing to notify NHTSA regulators about vehicle safety problems
- Failing to alert vehicle owners and dealers about these issues
- Failing to carry out “effective and timely recall remedies.”
Some of the specific safety issues that Fiat Chrysler admits to having dropped the proverbial ball on include:
- Defective suspension parts, which could cause motorists to lose control of their vehicles
- Additional defects, which could cause Jeeps (specifically) to erupt into fires.
An Overview of the NHTSA Enforcement Action against Fiat Chrysler
At this point, Fiat Chrysler has agreed to a consent order with the NHTSA, which will require the automaker to:
- Pay a $105 million penalty – This penalty, which is the biggest one the NHTSA has ever imposed on an automaker, includes a $70 million cash penalty, as well as a mandate to spend at least $20 million to meet the “performance requirements included in the Consent Order.”
- Notify certain vehicle owners that they are eligible for buybacks or financial incentives to get their vehicles fixed
- Hire an “independent monitor approved by the NHTSA” to evaluate Fiat Chrysler’s compliance with the Consent Order moving forward.
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Categories: Defective Vehicle Equipment