Filed under: Government/Legal, Safety
Toyota made all kinds of news during its recall woes, with one headline item being the record-breaking $32.4 million civil penalty it paid to the National Highway Traffic Safety Administration. The charge was levied by NHTSA because it considered Toyota tardy in announcing its recalls, and was almost twice the additionally record-setting $16.4 million fine that Toyota paid to address the recall itself. According to a report in Reuters, though, NHTSA Administrator David Strickland believes that such fines aren't strong enough deterrents for automakers.
Currently the maximum fine the NHTSA can levy per infraction is $17 million. Due to last year's climate catastrophes, Toyota's profit for its 2011-2012 fiscal year is expected to drop 42 percent from the year before, but this month the company issued a projection of ¥200 billion ($2.5 billion U.S.) for operating profit. Having to pay government fines is never ideal, but Toyota's total fine of $48.4 million, when compared to $2.5 billion, probably made the public stoning far more painful than writing that check.
Carmakers are said to be doing more, and doing it more quickly, when it comes to investigating and announcing recalls. Still, Strickland wants the maximum civil penalty raised by almost a factor of 15, to $250 million per infraction. The language to do so has been included in a transportation bill approved by the Senate, but a House version omits that provision. Republicans - and automakers - have no interest in seeing it added, but unless he's just rattling the cage to keep the heat up, this probably won't be Strickland's last effort to get a bigger bat.
NHTSA wants to issue larger fines for safety and recall infractions originally appeared on Autoblog on Wed, 28 Mar 2012 10:58:00 EST. Please see our terms for use of feeds.
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