GM to Pay $35M in Recall Fines

By | May 16, 2014
General Motors has agreed to pay the government $35 million for failing to report ignition switch defects in a timely manner. This payment represents the highest civil penalty an automaker has ever paid for violating recall procedures. The National Highway Traffic Safety Administration ordered GM to change the way it reviews safety issues in the U.S. The government will also oversee the recall to ensure replacement ignition parts are produced quickly and recalled vehicles are repaired quickly. GM will also pay additional fees for failing to promptly hand over necessary documents related to the investigation. “We have learned a great deal from this recall. We will now focus on the goal of becoming an industry leader in safety,” said GM CEO Mary Barra in a prepared statement Friday. “We will emerge from this situation a stronger company.”
GM has since made a few changes to its organization structure to better deal with recalls in the future. It has appointed new leaders in its engineering division as well as a new Global Vehicle Safety Chief in charge of recalls and safety. Meanwhile, the government is taking measures to further deter automakers from delaying recalls. Transportation Secretary Anthony Foxx recently asked Congress to increase the maximum fines from $35 million to $300 million if automakers fail to report defects promptly to the government. Source: General Motors, U.S. Department of Transportation