GM Paying Record $35 Million Civil Penalty in Ignition Switch Case

"Safety is our top priority, and today's announcement puts all manufacturers on notice that they will be held accountable if they fail to quickly report and address safety-related defects," U.S. Transportation Secretary Anthony Foxx said.

General Motors has agreed to pay a record $35 million civil penalty and to participate in "unprecedented oversight requirements," the National Highway Traffic Safety Administration announced May 16, as a result of findings from NHTSA's timeliness investigation about problems with the ignition switch in the Chevrolet Cobalt and GM's failure to report a safety defect in the cars to the federal government in a timely manner. The failure caused front-seat airbags in certain Cobalts and other GM models not to deploy in a crash. This eis the highest civil penalty amount ever paid as a result of a NHTSA investigation of violations stemming from a recall, according to the agency.

A Consent Order signed by GM and NHTSA directs the automaker to make internal changes in its review of safety-related issues in the United States and to improve its ability to evaluate the possible consequences of potential safety-related defects. GM will pay additional civil penalties for failing to respond in a timely way to the agency's document demands during the investigation.

"Safety is our top priority, and today's announcement puts all manufacturers on notice that they will be held accountable if they fail to quickly report and address safety-related defects," U.S. Transportation Secretary Anthony Foxx said. "While we will continue to aggressively monitor GM's efforts in this case, we also urge Congress to support our GROW AMERICA Act, which would increase the penalties we could levy in cases like this from $35 million to $300 million, sending an even stronger message that delays will not be tolerated."

Federal law requires all auto manufacturers to notify NHTSA within five business days of determining that a safety-related defect exists or that a vehicle is not in compliance with federal motor vehicle safety standards and to promptly conduct a recall. GM admits in the Consent Order that it did not do so.

"No excuse, process, or organizational structure will be allowed to stand in the way of any company meeting their obligation to quickly find and fix safety issues in a vehicle," said NHTSA Acting Administrator David Friedman. "It's critical to the safety of the driving public that manufacturers promptly report and remedy safety-related defects that have the potential to lead to deaths or injuries on our nation's highways."

The order requires GM to notify NHTSA of changes to its schedule for completing production of repair parts by Oct. 4.

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