UPDATE 6:20 p.m. EDT: WASHINGTON (Reuters) - The U.S. auto safety watchdog, toughening its stance against manufacturer defects, on Sunday set a record penalty of $105 million against Fiat Chrysler Automobiles NV over lapses in safety recalls involving millions of vehicles, according to documents obtained by Reuters.
A U.S. government agency is expected announce a record $105 million fine for Fiat Chrysler early next week, as a result of lapses in recalls that affected millions of vehicles, according to a Wall Street Journal report.
The fine, from the National Highway Traffic Safety Administration (NHTSA) is expected to come in addition to a series of other measures, including forcing the company to have future recall processes scrutinized by an independent monitor, and having it buy back a series of recalled vehicles to get them off the road, the paper reported, citing a source familiar with the matter.
The company will also make payments to owners of 1.56 million recalled older-model Jeeps, which have gas tanks behind the rear axle, to push them into bringing the vehicles to dealers to install trailer hitches that will help protect the tanks. The tanks are vulnerable and can leak gasoline if damaged in rear collisions, the Associated Press reported.
Over 70 people have been killed in fires involving Jeeps with this defect. Only 12 percent of owners have brought their vehicles in for repairs to minimize the risk associated with it, despite a recall being initiated in June 2013, the New York Times reported.
The agency's actions come less than a month after it took the unusual step of holding a public hearing on the problems with 23 Fiat Chrysler recalls covering over 11 million vehicles. The hearing, combined with the expected announcement of a record fine for the company, is a sign that regulators are taking an increasingly hard stance against automakers that fail to comply with safety laws.
Many consumer complaints were aired at last month's hearing, including the case of a 1998 Jeep Grand Cherokee owner who was told to contact a dealer to have a free trailer hitch installed on his vehicle. When he did so, he was told he would need to wait for parts to be available, and was not subsequently contacted by the company for over a year.
News of the fine comes just days after Fiat Chrysler announced the recall of 1.4 million Dodges, Jeeps, Rams and Chryslers after discovering that a software flaw in the cars’ radios makes them vulnerable to hackers.