By on April 30, 2014

Anthony Foxx + Barack Obama et al

As part of a $302 billion, four-year plan to fund both infrastructure and highway funding, U.S. Transportation Secretary asked Congress to allow the National Highway Traffic Safety Administration to boost its maximum fine from the current $35 million levy to $300 million.

Automotive News reports that in addition to the increased maximum fine, Foxx’s proposal also would prevent rental companies and dealerships from lending or renting affected vehicles under a recall. NHTSA administrator David Friedman lauded the proposal, stating the increase would serve as a deterrent against future recall delays and related tactics by automakers:

As the nation’s top regulator of the automotive industry, we hold manufacturers accountable for defect and compliance issues regarding their products, and are seeking to further our ability to do so in the future.

Past attempts to pass similar legislation, including a $200 million maximum levy put forth by the Obama administration, have met resistance from both the automotive industry and its dealers. With House Republicans wary of putting more tax dollars into the declining Highway Trust Fund, and industry lobbyists ready to fight they call “an unnecessary deterrent,” the new plan will face an equally difficult road to resolution.

During the 2013 fiscal year, the NHTSA levied a total of over $35 million in fines, including $17.5 million from Ford paid last June for a delayed 2012 recall of 485,000 2001 through 2004 Ford Escapes/Mavericks over a defect in the vehicles’ cruise control leading to stuck-throttle issues.

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2 Comments on “Foxx Pushes NHTSA $300 Million Maximum Fine Hike Before Congress...”

  • avatar

    “…Ford Escapes and Mercury Mavricks…”

    Mariners. The (Ford) Maverick was the Escape’s name overseas.

    Anyway. Preventing the sale/loan/rental of recalled vehicles would impact dealerships and rental agencies, but I suppose it would also mean that they wouldn’t have to worry about liability – if a potentially unsafe car isn’t lent out, it can’t fail and contribute to a collision. (In practice, I have no idea who usually gets sued in such a situation.) Of course, that could also be avoided using good faith… if it exists among dealerships and rental agencies (I kid, I kid!)

    As for increased penalties… I’m concerned about how fairly and consistently they’ll be levied on negligent manufacturers, and about whether that money will end up in the Highway Trust Fund as is suggested.

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