Time for Stepped-Up Fines When Automakers Neglect to Announce Defects?

July 05, 2012 (Press-News.org) The 2010 Toyota safety crisis revealed the full extent of the damage defective auto parts can do to the unsuspecting public. While automakers have generally been quicker to report vehicle safety problems in the two years that have elapsed since the massive Toyota recalls began, many in Washington feel that steeper civil penalties are needed to incentivize expedient disclosure of auto defects in an industry that contributes some $500 billion to the U.S. economy every year.

$17 Million Max Fine Increased to $250 Million in Senate Bill

Under current law, auto manufacturers have five business days to notify the National Highway Traffic Safety Administration of any defects that become apparent in the cars, trucks or motorcycles they market. The NHTSA may levy civil fines against companies who fail to comply, up to a maximum of $17 million per case.

Soaring over historical precedents, the NHTSA hit Toyota with a $32 million penalty in 2010 for twice neglecting to rapidly notify the agency of the defective accelerator pedals that plagued millions of vehicles. Yet, many argue that even historically-high fines like those levied against Toyota are not substantial enough to deter well-endowed businesses from withholding information from regulators.

"We feel it's high time the penalties are reflective of the size of the industry," NHTSA head David Strickland said in a recent hearing before the House Energy and Commerce subcommittee, according to Reuters news service.

The U.S. Senate has approved transportation legislation that would increase potential civil penalties against tightlipped automakers to a maximum of $250 million. However, not everyone is on board: a competing transportation bill in the House does not include the fine-hiking provision. Some lawmakers are concerned about the potential impact large fines could have on an American auto industry only now struggling back onto its feet.

Personal-Injury Lawsuits: Another Way to Combat Vehicle Defects

Government fines are not the only way to encourage responsible behavior from automakers who release potentially unsafe products. If you have been injured by a defective auto component, or if a family member has been killed, a defective auto parts lawsuit will not only deter similar automaker oversights in the future, it can also help you collect monetary damages for your injuries and protect your family from the severe financial impact caused by dangerous product defects. Thanks to product liability lawsuits automakers have been forced to eliminate exploding fuel tanks and compensate innocent consumers to the full extent of the law. We can only hope to do our part to create an economic environment that gives every incentive to manufacturers to design safer products and also to discover and correct defects before tragedy strikes. Contact a personal injury attorney to hold carmakers financially accountable for jeopardizing the safety of you or a family member.

Article provided by Drazin and Warshaw, P.C.
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