Feds fine Fiat Chrysler $70 million extra for recall failures

Feds fine Fiat Chrysler $70 million extra for recall failures
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The Obama administration is fining Fiat Chrysler Automobiles an additional $70 million for failing to properly repair recalled cars or replace them for owners. 

The agency said the fine is being levied onto an earlier $105 million fine that was imposed on Fiat Chrysler because the company has admitted failing to properly report defects with cars that have been subjected to recalls. 

Transportation Secretary Anthony FoxxAnthony Renard FoxxBig Dem names show little interest in Senate Lyft sues New York over new driver minimum pay law Lyft confidentially files for IPO MORE said the fine, which now totals $175 million, is necessary to protect drivers and warn other automakers that recalls should be taken seriously.  

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“Accurate, early-warning reporting is a legal requirement, and it’s also part of a manufacturer’s obligation to protect the safety of the traveling public,” Foxx said in a statement. “We need FCA and other automakers to move toward a stronger, more proactive safety culture, and when they fall short, we will continue to exercise our enforcement authority to set them on the right path.”

Automakers — as well as highway safety regulators in the Obama administration — have come under fire following widespread recalls involving parts that were first found to be defective years ago at companies like General Motors and Takata Corporation, beginning in 2014.

The issue of car safety was brought back into the spotlight again this year by recent revelations that German automaker Volkswagen has been cheating federal pollution emission standards to trick regulators into believing their cars are more fuel efficient than they actually are.

The National Highway Traffic Safety Administration (NHTSA) levied $105 million against Fiat Chrysler in July, saying the company improperly handled recalls that resulted in the large fine involving 23 different car parts and affecting 11 millions autos. 

Some Democrats in Congress are pushing for legislation that would make failing to inform federal regulators about faulty auto parts a crime that is punishable by up to five years in prison. 

The proposal would also eliminate a $35-million-per-violation cap on the NHTSA's ability to fine automakers that fail to comply with recall regulations and require the installation of a warning system that will warn drivers when their cars have been recalled by manufacturers. 

Transportation Department officials said Monday that Fiat Chrysler is now paying $140 million in fines for multiple violations, plus another $35 million if an independent monitor finds further violations of federal recall regulations. 

NHTSA Administrator Mark Rosekind said the fines that are being imposed on Fiat Chrysler are a sign of the Obama administration's commitment to cracking down on U.S. automakers that are failing to properly inform drivers and regulators about safety defects. 

“NHTSA’s enforcement actions in recent months have been designed not only to penalize previous actions, but to increase safety going forward,” Rosekind said in a statement. 

“FCA has expressed a desire to use this situation as a stepping stone to a stronger, more proactive safety posture, and NHTSA is ready to work with FCA and the industry as a whole to improve safety,” he continued. 

Fiat Chrysler said at the time of its initial fine that it accepts the terms of the agreement with the highway safety agency "with renewed resolve to improve our handling of recalls and re-establish the trust our customers place in us." 

"We are intent on rebuilding our relationship with NHTSA and we embrace the role of public safety advocate," the company said in a July statement.

"Accordingly, FCA US has agreed to address certain industry objectives, such as identifying best practices for recall execution and researching obstacles that discourage consumers from responding to recall notices," the Fiat Chrysler statement concluded.