NHTSA Shows It’s Serious About Timely Reporting; Fines BMW $3 Million
By Mike Rozembajgier
BMW North America is the latest example of how serious the National Highway Traffic Safety Administration (NHTSA) is about cracking down on automakers. The luxury car manufacturer was recently fined $3 million for failing to notify the auto regulator about safety defects and recalls in a timely manner.
This is the largest penalty announced by NHTSA since Toyota agreed to fork over nearly $50 million for disclosure issues involving the automaker’s massive 2009 and 2010 sudden acceleration recalls. Since then, NHTSA has been warning that it would scrutinize auto manufacturers for infractions.
The latest fine was announced after the auto watchdog identified a slew of disclosure violations linked to 16 probes of BMW recalls affecting over 338,000 vehicles and motorcycles in 2010. It found that the automaker failed several times to swiftly report issues that led to recalls later down the road. NHTSA also claims that the company initially provided little information about the recalls and then dragged its feet when asked to follow up.
U.S. law gives manufacturers just five business days to notify the government of any defects in cars, trucks or motorcycles. By failing to be transparent and quick to alert the feds of potential dangerous hazards, BMW put its reputation on the line. To its credit, the company has tried to placate the regulators and consumers by reviewing and changing the recall decision-making process.
Others in the auto industry should take note. Poorly managed – and poorly communicated – recalls can have a dramatic effect on a company’s brand and bottom line. Regularly assessing and updating your recall procedures ensures that you are prepared to respond to an event the right way.
How are you responding to NHTSA’s new scrutiny of the auto industry? How often do you assess your recall procedures to ensure they are in compliance with federal regulations? Your thoughts are most welcome below.
Stericycle ExpertRECALL™ is the industry leader in recall logistics and regulatory compliance for consumer product, pharmaceutical, medical device, juvenile product, and food and beverage recalls. ExpertRECALL’s professionals are experts in recall management who can help you streamline the entire product recall process.