• 11
  • February
    2012

When an auto maker learns of a safety defect or a noncompliance issue, they are given five business days to tell the National Highway Traffic Safety Administration and issue a recall. BMW failed to meet the requirements of that federal law in 2010 and was fined $3 million for their handling of the defective vehicles. In addition to the fine, the company agreed to change the way it handles defects in the future so the NHTSA and the public are informed in a timely manner.

The NHTSA investigated BMW because it believed that the company was not giving notice to consumer quickly enough. BMW issued 16 recalls last year for issues ranging from improper tire labels to defective fuel pumps. The NHTSA sought information about when BMW officials learned of each of these defects and how soon they communicated that information to consumers and the government. After finding that the company had violated the National Traffic and Motor Vehicle Safety Act, it pursued a civil action.

Motor vehicle recalls and other defective product recalls are a common occurrence. Defective designs, substandard components and manufacturing errors can lead to dangerous products getting to consumers. By requiring companies to acknowledge the safety concerns they find, the NHTSA tries to limit the potential for serious injuries. This fine sends a message to BMW that consumer safety is always the top priority.

The decision to recall a product is often a costly one for car manufacturers. Without strict enforcement and substantial fines, these companies might choose to risk endangering consumers rather than own up to safety problems.

Source: NHTSA.gov, "BMW to Pay $3 Million in Civil Penalties for Untimely Reporting of 2010 Recalls," 10 February 2012