Obama administration proposes higher fines for vehicle safety violations

Article by Christian Andrei, on March 24, 2012

The administration of Obama is seeking considerably higher fines for violations of auto safety despite the vehicle manufacturers being able to quickly report defects to U.S. regulators following the recall crisis of Toyota Motor Corp. The present maximum fine of $17 million per case is not sufficient, according to David Strickland, who is the government's top vehicle safety official as administrator of the National Highway Traffic Safety Administration.

He further commented that the fines will not put off businesses with deep pockets from withholding safety information from regulators inadvertently or deliberately. 

Strickland said during a House Energy and Commerce subcommittee hearing that it is time the fines are "reflective of the size of the industry." Last week, the Senate has approved a provision in transportation legislation that would raise civil penalties for the first time in more than a decade to as much as $250 million.

Vehicle manufacturers call the proposal as excessive in an era wherein vehicle safety has increased with people traveling at least three million miles on U.S. roads each year.

A competing House bill does not include the proposal. Republicans running the House see the proposed increase as overly prescriptive and potentially damaging to an industry coming back to profitability after a historic crisis.

They also see it as another obstacle to any compromise with the Senate on halted highway legislation. Rep. Marsha Blackburn, R-Tenn., and vice-chairman of the commerce, manufacturing and trade subcommittee, commented that "more mandates" were not the answer to the matter. The official further said that it would be "very difficult" to obtain the backing of Republicans for higher fines.

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