2014 NHTSA Fines Reach Historic Proportions

In 2014 alone, the National Transportation Traffic Safety Administration (NHTSA) fined automakers and third parties in excess of $126 million – more than the total amount collected by the agency in its forty-three year history.

Listed below are the civil penalties imposed by NHTSA in 2014:

  • Honda was fined $70 million for failing to submit early warning reports and warranty claims.
  • Gwinnett Place Nissan of Duluth, Georgia, failed to fix recalled components in new motor vehicles before selling them and was fined $110,000.
  • Ferrari was fined $3.5 million for failing to submit early warning reports.
  • Chapman Chevrolet (Philadelphia, Pennsylvania) paid a fine of $50,000 for failing to perform recall remedies in new vehicles prior to sale.
  • Hyundai Motor America dragged their feet on issuing a recall and was fined $17,350,000.
  • GM was fined $35 million for failure to issue a recall in a timely manner.
  • GM failed to fully respond to a Special Order by the due date and was fined $441,000.
  • Prevost, a division of Volvo, was charged with the second of six annual installments of $250,000 (total of $1.5 million penalty) for untimely recalls and early warning reports.
  • Southern Honda Powersports (a/k/a Big Red Powersports) (Chattanooga, Tennessee) paid $25,000 in the second of five annual installments (total $125, 000 civil penalty) for the sale of unrepaired, recalled motorcycles.

Reporting Requirements for Vehicle Defects

The TREAD (Transportation Recall Enhancement Accountability Documentation) Act was passed in 2000 to improve consumer safety by creating an early warning system to detect vehicle defects that would endanger users. Vehicle and equipment manufacturers are required to make periodic reports to NHTSA about a wide variety of topics, and NHTSA is authorized to impose civil penalties on those who fail to do so. The Act has been amended over time, to include additional areas of oversight, such as tires, rollovers, and child restraints. Some issues must be reported monthly and others are required on a quarterly basis, and they include the following information:

  • Field reports received by manufacturers about components or systems that are faulty or have problems
  • Copies of written communications sent to more than one manufacturer, dealer, distributor, lessee, lessor or purchaser related to a possible defect, whether or not safety-related
  • Notices of a fatality in the United States received by the manufacturer alleging that the fatality was caused by a possible defect in the manufacturer’s vehicle or equipment
  • Claims of fatalities in a foreign country received by the manufacturer concerning a vehicle or item of equipment that is “substantially similar” to the vehicle or item of equipment offered for sale by that manufacturer in the United States
  • A report on each injury in the U.S., no matter how minor, received by the manufacturer alleging that the injury was caused by possible defect in the manufacturer’s vehicle or equipment.
  • The number of claims received by manufacturers for property damage that occurred in the U.S. that are related to alleged problems with certain specified components and systems, regardless of the amount of such claims
  • The number of U.S. consumer complaints received by manufacturers that are related to problems with certain specified components and systems
  • The total number of warranty claims manufacturers receive in the U.S. in conjunction with specified components and systems, including all good will and extended warranty claims.

At McNeely Stephenson, we have proven experience in helping people hurt in Indiana by defective automobiles, trucks and motorcycles. As you can see by the listing of information that must be reported to NHTSA, very often the agency becomes aware of a safety issue because of claims from consumers. If you have experienced a problem with a potentially dangerous or defective or previously recalled motor vehicle or one of its components, contact McNeely Stephenson at 1-317-825-5200 today.