Fiat Chrysler receives harshest penalty on record by NHTSA

| 7/27/2015

The National Highway Traffic Safety Administration has had its hands tied with massive recalls this year, and now the administration is laying down the law. NHTSA has handed Fiat Chrysler Automobile its harshest penalty in the administration’s history.

According to a NHTSA press release, Fiat Chrysler will be required to submit to rigorous federal oversight, buy back defective vehicles from owners, and pay a $105 million civil penalty. The penalties are in response to 23 safety recalls that affected more than 11 million vehicles.

In a public hearing earlier this month, Fiat Chrysler admitted to violating the Motor Vehicle Safety Act. More specifically, the auto manufacturer violated effective and timely recall remedies, notification to owners and dealers, and notification to NHTSA.

More than half a million vehicles with defective suspension parts can be sold back to Fiat Chrysler. Owners of Jeeps that are susceptible to catching on fire will be able to trade in their vehicles for above-market value. Owners who do not wish to trade in their vehicle will receive a financial incentive to get their vehicle repaired. Eligible owners will be notified.

Fiat Chrysler will also be under the probing eye of federal regulators for the next three years. The company must hire an independent monitor approved by NHTSA.

The civil penalty includes a $70 million cash penalty, another $20 million to meet performance requirements, and $15 million if the independent monitor discovers additional violations. The previous record was set in January when Honda was given a $70 million civil penalty.

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