Regulators penalized BMW $40M for slow mini car recall

By Money Times

Dec 29, 2015 07:29 AM EST

BMW North America faces a penalty of up to $40 million by U.S. auto-safety regulators for recall failures.

According to US News, U.S. safety regulators have fined penalty with German automaker BMW AG with $40 million for a reason of not fast fixation of their Mini brand cars that failed federal crash tests. Moreover, the National Highway Traffic Safety Administration also claimed on Monday that the agency did not get accurate recall information from BMW.

The company signed a consent order, which BMW is due to pay $10 million in cash and $10 million on steps to get into compliance. But if BMW failed to comply or broke other safety regulations, the company will be fined with another $20 million.

The agency mentioned in a statement that BMW is willing to take steps against the recurrence of violation of regulations. The company also said that the time period of the consent order is two years. But NHTSA has full right to extend it for another year.

This is not the first time the agency has fined the company. Previously in 2012, BMW was fined with $3 million by the agency for similar violations, as mentioned by The Detroit News.

On Monday, NHTSA Administrator Mark Rosekind said in a statement, "For the second time in three years, BMW has been penalized for failing to meet that obligation. The company must take this opportunity to reform its procedures and its culture to put safety where it belongs: At the top of its priority list."

According to a federal law, if the automakers found a safety defect or noncompliance existence, the company must instantly conduct a recall and notify NHTSA within five working days. So the consent order, dated Dec. 17, was signed when BMW failed to issue a recall within five days after coming into knowledge about the Mini Cooper models not fulfilling regulatory standards for side-impact crash protection.

Many safety scandals related to other companies have been heard in the auto industry previously. Over the last two years, General Motors and Fiat Chrysler have been penalized by NHTSA  for not fixing their defective vehicles expeditiously and notifying safety officials instantly, as mentioned by USA Today.

BMW said in a statement that it "is committed to further improving its recall processes to better serve its customers" and that it "respects the role of NHTSA and looks forward to working with them to develop solutions for the future." 

However, the company refused to respond to the multiple of the requests for conducting an interview regarding the matter. During its subsequent investigation, NHTSA also came across multiple of other  recall reporting violations.

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