The National Highway Traffic Safety Administration (NHTSA) has fined automakers Forest River Inc. and Spartan Motors Inc. at least $9 million for failing to disclose critical information regarding known safety defects, a violation of the agency’s Safety Act. According to NHTSA, investigations of the companies last year revealed that both had failed on multiple occasions to issue timely recalls, submit early warning data or disclose to the agency when they had released technical service bulletins to their customers.
Forest River, a Berkshire Hathaway-owned company, will pay a $5 million cash penalty up front and Spartan will pay a $1 million penalty and $3 million worth of safety improvement costs. Both companies are also required to comply with third-party audits. Further violations by Forest River could cost the company $30 million and Spartan $5 million. U.S. Transportation Secretary Anthony Foxx said in a statement:
Safety is a critical shared responsibility, and when manufacturers fail to meet their responsibility, the department will enforce the law. Today’s action sends a message to these manufacturers and to others that withholding critical safety information is not an option.
In September 2014, NHTSA opened an investigation into Forest River, an Indiana-based recreational vehicle maker, asking it to submit customer notification documents related to any known safety defects. In February and March, the company notified NHTSA of both a faulty wiring and exhaust vent defect in two sets of camper trailers that it had reported to customers the previous year, but failed to report to the agency.
A similar investigation into Spartan, a Michigan-based maker of specialty heavy-duty vehicle chassis and emergency-response vehicles, revealed that the company had failed to notify NHTSA of 244 service bulletins over a 10-year period starting in April 2003. The agency determined that three of those safety bulletins, which occurred between 2012 and 2013 and were disclosed to customers, should have been submitted to the agency as safety defects and were not.
I wrote on this matter primarily to remind our readers that under the National Traffic and Motor Vehicle Safety Act of 1966 and the NHTSA’s defect reporting regulations, all manufacturers of vehicles and equipment are required to submit a copy of each service bulletin no later than five working days after the end of month it was issued.
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