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FIAT Chrysler Faces Huge Fine for Recall Lapses

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author photo by Doug DeMuro July 2015
  • FIAT Chrysler faces $105 million fine for recall-related failings
  • Failings include inadequate repairs and obstructing government regulators
  • Fine is largest civil penalty levied against an automaker for recall violations

FIAT Chrysler faces a $105 million fine for various failings related to the recall of more than 11 million vehicles. That's the latest from the federal government, who recently announced the huge penalty in the wake of several of the automaker's recall shortcomings.

According to the government, the fine, which is the largest civil penalty ever imposed on an automaker for recall violations, relates to a series of legal violations in several key recall areas including alerting car owners too slowly, inadequate recall repairs and obstructing regulators who were investigating safety issues.

"This civil penalty puts manufacturers on notice that the department will act when they do not take their obligations to repair safety defects seriously," said transportation secretary Anthony Foxx, in a statement.

For its part, FIAT Chrysler has admitted to violating federal rules and promised to do better in the future, noting that the brand, "accept[s] the resulting consequences with renewed resolve to improve our handling of recalls and re-establish the trust our customers place in us."

In addition to the fine, Chrysler has also agreed to buy back around 500,000 recalled RAM pickups with potential suspension issues. It must allow more than 1.4 million Jeep owners to trade in their vehicles at an above-market rate after those vehicles were recalled for gas tanks that could be prone to fire.

Under the terms of the recall, Chrysler will pay $70 million in cash to the federal government as a fine and must spend $20 million meeting various performance requirements. An additional $15 million penalty is also possible if an independent safety monitor discovers further violations.

Although the fine is the largest of its type levied against an automaker, it isn't the only such fine in recent years. Honda was fined $70 million earlier this year for various recall lapses, and General Motors earned a $35 million fine last year for similar violations.

What it means to you: The huge fine levied against FIAT Chrysler shows just how seriously the government is taking automotive recalls now.

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FIAT Chrysler Faces Huge Fine for Recall Lapses - Autotrader