Chrysler Hit with Record Fine
The CBS Evening News reported, “The US government is coming down hard on carmakers over the mishandling of defective vehicles.” Fiat Chrysler fined a record $105 million and must buyback hundreds of thousands of pickup trucks and SUVs. Transportation Secretary Foxx said, “It is not a good business decision to try to skate the process or to the do the right thing on the front end. It’s a better practice to do the right thing, make the recalls work, make them effective and move on.” CBS (van Cleave) added that the company, in a statement, “said they accept the fine and increased government oversight.”
ABC World News reported that the fine was for “sloppy handling of recalls.” They added there were “23 previously mishandled recalls, covering 11 million vehicles. Inconsistent, insufficient, and inaccurate information given to the government and consumers.” Secretary Foxx said, “There’s no way to defend what Fiat Chrysler was doing. And whether it is a matter of commission or omission, the reality is that consumers were not protected in this situation.”
The AP reports that, under a deal with deal with the National Highway Traffic Safety Administration, Fiat Chrysler “must offer to buy back 500,000 Ram pickup trucks and other vehicle,” which could cost it billions of dollars.
The New York Times reports that “regulators decided to get creative in their punishment” of Fiat Chrysler and hope that “the long list of other tasks and requirements” for the company will help “stamp out shoddy safety practices by automakers.” The company must not only buyback defective vehicles, pay consumers to participate in one recall, and “give broad authority to an independent monitor to oversee its safety operations,” but also pay for “educational programs on vehicle recalls for consumers, suppliers and other automakers.” Secretary Foxx said not fixing unsafe cars will meet such “very aggressive” actions, adding, “I think we are going to see the industry taking this issue more seriously.” National Highway Traffic Safety Administration head Mark R. Rosekind “expressed confidence that forcing Fiat Chrysler to research how to improve recalls industrywide would have long-term benefits.”
The Wall Street Journal reports that Foxx said that he is encouraged by the safety dialogue with car makers, “but it doesn’t mean that if we find ourselves in a situation where enforcement action is necessary that we will not do everything we can.” He added, “One of my priorities has been to make NHTSA a much more muscular agency.” Still, the Fiat Chrysler matter hasn’t been referred to the Justice Department.
The Los Angeles Times reports that remarks by regulators indicate “that they are taking a tougher stance on automakers that don’t identify and quickly repair defects in their cars.” Foxx said, “We are sending an unambiguous message to the industry,” adding, “if you skirt the laws or violate the laws we are going to penalize you.” Foxx also said, “We are continuing to be very aggressive in ensuring automakers are following the rules and that vehicles with defects are being fixed.” Rosekind said, “Fiat Chrysler’s pattern of poor performance put millions of its customers, and the driving public, at risk.” Analysts and safety advocates said this is “renewed vigor on the part of regulators and a wake-up call for the auto industry.”