This past year, we witnessed the GM Ignition Switch investigation, which involved massive recalls, multiple Congressional hearings, and civil penalties; the ongoing Takata airbag inflator investigation and recalls (and more Congressional hearings); multiple legislative proposals seeking to increase the civil penalty ceiling and expand NHTSA’s enforcement authority; and an unprecedented number of other recalls, civil penalties, and investigations. In the midst of this active enforcement environment, the agency also continued its busy rulemaking docket, including major actions related to V2V communications, distracted driving, and other initiatives.
Look for the following during 2015:
NHTSA has been aggressively enforcing its defect and early warning reporting regulations this past year and it will certainly continue to do so well into 2015 and beyond as it reacts to public and Congressional pressure to further flex its enforcement muscles. NHTSA has asserted and obtained the applicable maximum penalty at least nine times since 2010, in amounts ranging from $16.4 million to $35 million in settlements with Toyota (four separate settlements for a total of $48 million), Ford, Hyundai, GM and Honda (single settlement alleging two separate violations for a total of $70 million). The agency also reached several other settlements greater than $1 million with BMW, Volvo, Prevost, and Ferrari.
To reduce compliance risks, all vehicle and parts manufacturers should implement safety compliance policies that provide internal guidance to company personnel for identifying and investigating potential safety defects or non-compliance, and for complying with all associated NHTSA reporting requirements (e.g., defect reporting, early warning reporting, and reporting certain non-safety bulletins and customer communications).
There have been numerous calls to increase civil penalties and expand NHTSA’s enforcement authority over the past few years, but recent events have brought significant bipartisan attention to the area of motor vehicle safety. Several bills have been introduced that would establish criminal penalties for individuals who conceal safety defects, increase or remove altogether the civil penalty cap, require additional public disclosure of manufacturers’ early warning data, and prohibit rental car companies from renting recalled vehicles until recall repairs are completed. Manufacturers should closely monitor legislative developments and watch for new bills with bipartisan support to be introduced in the new Congress.
NHTSA has been carefully studying the safety benefits of various advanced crash avoidance technologies, with a particular focus on warning technologies, such as blind spot detection and advanced lighting; intervention technologies, such as lane departure prevention, crash imminent braking (CIB), and dynamic brake support (DBS); and automatic pedestrian detection and braking. The agency is expected to continue to evaluate research data, technologies, and potential countermeasures and, if the benefits of these systems (in terms of lives saved and injuries reduced) are found to outweigh the costs, the agency could initiate rulemaking to require one or more of these technologies in vehicles.
The agency has also been studying V2V and vehicle-to-infrastructure (V2I) communications as a way to improve the effectiveness and availability of these safety systems. In August 2014, it issued an advanced notice of proposed rulemaking (ANPRM) as a first step toward adopting a V2V standard (FMVSS No. 150). The agency will review the nearly 1,000 comments it received and evaluate its next steps, which will likely be a formal proposal.
In April 2013, NHTSA adopted the first phase of its three-phase federal guidelines intended to address driver distraction from in-vehicle electronics. The first phase covers original equipment in-vehicle electronic devices used by the driver to perform secondary tasks (e.g., communications, entertainment, information gathering, navigation tasks, and so forth) through visual manual means. NHTSA is now proceeding with the second phase, which would be applicable to portable and aftermarket electronics. During 2015, we anticipate that the agency will continue development of its proposed guidelines based upon the substantial industry and public feedback it has received, and it could be soon ready to publish a proposed set of guidelines for public comment.
During 2014, NHTSA launched its online “Recalls Portal,” where most defect reporting and recall-related correspondence must now be submitted. During 2015, we expect the recall review process to become significantly more streamlined, with quicker NHTSA review and response times. As a consequence, recalls will likely be posted to the NHTSA website more quickly, so manufacturers must be prepared to respond to inquiries from customers, dealers, and the media sooner than they have in the past.
The large number of recalls during 2014, and the correspondingly large number of unrepaired vehicles, have brought renewed attention to the issue of recall completion rates, which have historically averaged 70 to 80 percent for passenger cars. Therefore, we anticipate that NHTSA will take further steps over the next year — likely by working with manufacturers and others — to find creative ways to increase completion rates.