Friday, May 16, 2014
General Motors has agreed to pay the government’s maximum fine of $35 million for waiting too long to recall 2.6 million cars with faulty ignition switches and to make “significant and wide-ranging internal changes” in its handling of future safety defects, the U.S. Department of Transportation said today.
“Safety is our top priority, and today’s announcement puts all manufacturers on notice that they will be held accountable if they fail to quickly report and address safety-related defects,” Transportation Secretary Anthony Foxx said in a statement.
Federal law requires automakers to notify safety regulators within five days after determining that vehicles are defective. Documents filed by GM indicate that its engineers first encountered a problem with the switch in 2001 and studied the issue multiple times in 2004 and 2005 without issuing a recall or modifying the switch.
“We have learned a great deal from this recall. We will now focus on the goal of becoming an industry leader in safety,” GM CEO Mary Barra said in a statement issued by the company. “We will emerge from this situation a stronger company.”
NHTSA ordered Toyota Motor Corp. to pay three fines totaling nearly $50 million in 2010 and 2012. The maximum fine has been increased to $35 million per incident since then, and Foxx recently expressed support for raising it to as much as $300 million.