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Recall enforcement action: Chrysler vehicles for defective suspension parts that could cause loss of control and deadly fires in Jeeps

Jeep-rear-view.650pFiat Chrysler Automobiles has acknowledged violations of federal requirements to repair vehicles with safety defects. It will be subject to federal oversight, buy back some defective vehicles from owners, and pay a $105 million penalty, the largest ever imposed by the U.S. Department of Transportation’s National Highway Traffic Safety Administration.

The enforcement action comes after a July 2 public hearing at which NHTSA outlined problems with how Fiat Chrysler carried out 23 vehicle safety recalls covering more than 11 million defective vehicles. Fiat Chrysler has since admitted to violating federal law in three areas: effective and timely recall remedies, notification to vehicle owners and dealers, and notifications to NHTSA.

“Today’s action holds Fiat Chrysler accountable for its past failures, pushes them to get unsafe vehicles repaired or off the roads, and takes concrete steps to keep Americans safer going forward,” said U.S. Transportation Secretary Anthony Foxx said Sunday.

In a consent order issued by NHTSA, Fiat Chrysler agreed to take action to get defective vehicles off the roads or repaired. Owners of more than half a million vehicles with defective suspension parts that could cause the vehicle to lose control will be able to sell their vehicles back to Fiat Chrysler.

Owners of more than a million Jeeps that are prone to deadly fires can trade their vehicles in for above its market value or receive a financial incentive to get their vehicles fixed.

The consent order requires Fiat Chrysler to notify vehicle owners eligible for buybacks and other financial incentives that these new options are available.

The automaker also agreed to oversight for three years, which includes hiring an independent monitor approved by NHTSA to assess, track, and report the company’s recall performance.

“Fiat Chrysler’s pattern of poor performance put millions of its customers, and the driving public, at risk,” Mark Rosekind, NHTSA administrator, said. “This action will provide relief to owners of defective vehicles, will help improve recall performance throughout the auto industry, and gives Fiat Chrysler the opportunity to embrace a proactive safety culture.”

The company must pay a $70 million cash penalty – equal to the record $70 million civil penalty the agency imposed on Honda in January.

In addition, Fiat Chrysler must spend at least $20 million on meeting performance requirements included in the consent order. Another $15 million could be paid if the independent monitor finds additional violations of the Motor Vehicle Safety Act or the consent order.

Copyright 2015, Rita R. Robison, Consumer Specialist

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