The Obama administration is calling for higher fines for auto safety violations, but an auto trade group contends that the proposed increases are “unfairly punitive.”
David Strickland, the head of the National Highway Traffic Safety Administration, said in congressional testimony recently that the current maximum fine of $17 million per case is not adequate. The testimony is part of an ongoing push by the federal government to get tougher with auto companies about recalls and auto safety violations.
Strickland testified before a House Energy and Commerce subcommittee hearing. But Mitch Bainwol, president and CEO of the Alliance of Automobile Manufacturers, the industry’s lobbying group, said that proposed increases “are well out of proportion and unfairly punitive.” Tougher fines could stall the revival of the auto industry after a devastating downturn, critics fear.
“Motor-vehicle manufacturers are already subject to higher civil penalties than other similarly situated manufacturers of consumer products,” Bainwol said.
A provision in transportation legislation recently approved by the Senate would boost civil penalties to a maximum of $250 million. The legislation comes after NHTSA fined Toyota $32 million in 2010 for failing to promptly let the safety agency know about defects involving accelerator pedals.
Strickland also said that the U.S. government is seeking the authority to notify consumers of recall issues before they purchase a used vehicle or rent a car because it is “something that could easily protect consumers and provide real safety benefits.”
