Volvo to pay $130M for failure to issue timely recalls

Volvo Group North America has been ordered to pay a $130 million penalty for failure to recall heavy-duty vehicles in a timely fashion. 

The National Highway Traffic Safety Administration (NHTSA) announced Monday, January 30th that it has imposed the $130 million civil penalty after an investigation revealed the heavy-duty truck and bus manufacturer failed to recall vehicles in a reasonable time frame. 

As a result of the investigation, the Volvo Group agreed to a three-year consent order and oversight by an independent third-party auditor. The company will now meet regularly with NHTSA to ensure it addresses any potential manufacturing issues in a timely manner. The $130 million civil penalty is one of the largest ever for violations of the recall law. 

“NHTSA will use the full scope of our authorities to protect the public from safety defects and from manufacturers that create potential safety problems by failing to comply with the law,” Acting NHTSA Administrator Ann Carlson said, reported Reuters.

The investigation was opened by NHTSA in October of 2018 and analyzed the company’s compliance with recall timeliness, manufacturer warnings, and early warning reporting requirements. NHTSA says that the group failed to submit certain quarterly recall reports, manufacturer communications and did not report some death and injury incidents and submit certain field reports.

Volvo is now spending $20 million for development of  “a safety data analytics infrastructure to enhance its ability to detect and investigate potential safety defects,” NHTSA said. The company plans to develop procedures and training for its employees regarding recall compliance. 

Volvo says it appreciated “the opportunity to summarily resolve this matter, and we look forward to continuing our close work with NHTSA to identify and close any compliance gaps. Wide-ranging improvements in our North American safety processes and systems are already underway.”

Volvo group will pay $65 million within 60 days, and $45 million more if it fails to comply with the agreement. The agreement may be extended for up to two years. 

The third party auditor will evaluate all of Volvo’s recalls since 2013 and recommend any changes, if warranted.