The Detroit News (Washington, D.C.) - Automakers, car dealers, rental car companies and the U.S. Chamber of Commerce are opposing a bill that would hike fines for delaying vehicle recalls by up to $250 million.
The Senate Commerce Committee on Wednesday will consider a long-delayed bill to toughen auto safety laws. The bill, aimed at reforming the National Highway Traffic Safety Administration, would increase the maximum fines for manufacturers who delay recalls to $250 million from the current $17.35 million. The fines are adjusted annually for inflation.
Proponents have been pushing for more than a year to strengthen auto safety measures in the wake of sudden acceleration concerns in Toyota Motor Corp. vehicles. Sens. Mark Pryor, D-Ark., and Jay Rockefeller, D-W.Va., introduced the bill in late July; it would not take effect until at least one year after passage.
A coalition of groups — including the Alliance of Automobile Manufacturers, the Association of Global Automakers, U.S. Chamber of Commerce, National Association of Manufacturers and American International Automobile Dealers Association — told Congress late last week it opposes hiking the fines.
"The proposed increases are so out of proportion either to the current penalty structure or the penalty structure for other manufacturers under the Consumer Product Safety Act as to appear unfairly punitive," the groups said in a joint letter obtained by The Detroit News. "The proposed increases should be scaled back to a more appropriate level."
The alliance includes General Motors Co., Ford Motor Co., Chrysler Group LLC, Toyota and eight others.
Last year, Toyota was fined nearly $50 million for three separate recall incidents. Prior to that, the largest ever fine to an automaker was $1 million to GM in 2004.
The committee may also consider approving a proposal introduced in July by Sens. Barbara Boxer, D-Calif., Dianne Feinstein, D-Calif., and Charles E. Schumer, D-N.Y, to prohibit car rental companies from renting or selling vehicles to consumers that are under manufacturer recall.
Current law prohibits car dealerships from selling recalled new vehicles; no law bans rental companies from doing the same or renting them to consumers
The Motor Vehicle Safety Act would eventually bar automakers from installing television screens within eyesight of drivers and would require them to remind rear-seat passengers to use seatbelts.
It also would require automakers to install "brake override" systems that would allow drivers to halt speeding cars — even if the throttle is open. NHTSA would set standards for the placement of pedals to ensure that they are located to prevent them from getting stuck.
Automakers said they oppose the requirement that NHTSA develop a rule specifying minimum clearances for passenger vehicle foot pedals with respect to other pedals, the vehicle floor and any other potential obstruction to pedal movement.
"The agency should be allowed to finish and evaluate its research before a determination is made as to whether rulemaking is warranted," automakers and the other groups wrote.
The bill would require all automobiles to have event data recorders by 2015 and to study in-vehicle alcohol detection systems. NHTSA would take into account whether an automaker had been previously fined in the last five years in setting penalties and the size of a penalty in relation to the size of the business."
It would mandate a senior official at each automaker to certify the accuracy of its recall reports and requiring fines of $5,000 a day for submitting "false, misleading, or incomplete information" — up to $5 million.
Automakers also oppose that measure.
The bill would give NHTSA the power to consider other ways for automakers to notify owners of recalls — even emails or text messages — rather than by first-class letters.
Automakers back some provisions, including a proposed mandate that all new vehicles be equipped with event data recorders.
"Manufacturers who opted not to install EDRs under the voluntary standard will need sufficient lead time to develop and implement this technology in their fleets. NHTSA should have the authority to establish appropriate lead times, including any phase-in schedule, after consultation with the manufacturers," the groups said.
Also to be considered Wednesday is another auto safety bill: the Commercial Motor Vehicle Safety Enhancement Act, which toughens federal truck and bus safety standards.
The bill requires electronic on-board recorders be used on all trucks and buses used in interstate commerce in order to improve drivers' compliance with hours of service rules. It makes it easier to crack down on "reincarnated carriers" — carriers that attempt to resume operations after being put out of service — by increasing the ability to revoke carriers' operating authority.
