Industry News: Transportation Secretary Wants To Increase The Max Fine On Untimelyness

[William Maley]

Transportation Secretary Anthony Foxx wants to increase the maximum fine for automakers who fail to recall vehicles in a timely fashion from the current $35 million fine to a much more painful $300 million fine. The increase is part of a new transportation reauthorization bill whose primary focus is to fund maintenance for highways, bridges, and other infrastructures.

On a conference call with reporters, Foxx said the fines on automakers need to be “more than a rounding error” to act as a deterrent.

The department “wants to make sure there’s an ability to make it count and ensure that there’s enough of an effect across the industry,” Foxx said.

The bill also includes giving the National Highway Traffic Safety Administration the power to require auto manufacturers to remove automobiles from being sold if a defect is discovered. It would also force rental car companies to repair recalled vehicles before they are rented again.

Source: The Detroit News

William Maley is a staff writer for Cheers & Gears. He can be reached at [email protected] or you can follow him on twitter at @realmudmonster.

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[G. David Felt]

I am all for holding companies accountable, but it has to be within reason and it seems there is more positioning for reelection going on than common sense by the Idiots in DC.

[Drew Dowdell]

I think it needs to be made painful without making it too painful to develop cars in the first place. If they design something, find a flaw later, and immediately recall, they won't face the fine. But if they wait years and years, or publicly stall like Toyota did, then the fine should be very very painful for the company.... so painful that they have an incentive to not stall.

[balthazar]

>>"primary focus is to fund"<<

Egg-zactly; it a revenue tool, not a recall delay deterrent. Just like nearly everything done by Big Gov't.

[Drew Dowdell]

I don't see these things as mutually exclusive

[balthazar]

Don't have to be, question is; which is the true concept behind it?

We know what the spin is, but....

[Drew Dowdell]

What is another recall deterrent that you would suggest? Ideally, if the manufacturers do their jobs, the DoT wouldn't see a penny from these fines.

[balthazar]

First off, jumping a fine by a factor of TEN is ridiculous, but because they can & NO ONE can stop them, why not make it a factor of 50?

Secondly, I'd be much more willing to believe the cover story if the money went to something like, say, a victim's fund or medical costs, etc, rather than yet another slush fund Big Gov't can swipe from at will. Because you know that's what will happen if the check is made out to the DOT. It just smells bad (as usual).

Frankly, recall promptness should be a culture of business. This has to come from the people in positions of authority & policy in said corporations, in addition to company policy. Forcing it will only get it tied up in legal for a decade or so.

[G. David Felt]

All fines should go into the Roads Period, not into the general fund.

[Drew Dowdell]

The fine is "up to"... not a minimum. From the article: Toyota got wacked 3 times for their delays at a time when the maximum fine was $17.5 million, so that was still only $66 million for something that I've already shown was shear negligence.

[Robert Hall]

Frankly, recall promptness should be a culture of business. This has to come from the people in positions of authority & policy in said corporations, in addition to company policy. Forcing it will only get it tied up in legal for a decade or so.

It isn't though..the natural tendency for business is to hide things under the rug and cover it up. Without regulation and enforcement, recalls and recall promptness won't happen.

[Drew Dowdell]

There has been a culture, particularly at GM and Toyota it seems, for lower employees to be incentive to not blow the whistle. This is backwards.

[Robert Hall]

There has been a culture, particularly at GM and Toyota it seems, for lower employees to be incentive to not blow the whistle. This is backwards.

That's pretty much standard culture in most businesses I've been in...don't rock the boat, don't say anything that will draw attention to yourself and potentially embarrass management if you value your career...that's just the way it is.