Mercedes could pay an additional $7 million if it fails to meet the settlement's requirements.
Mercedes-Benz and the National Highway Traffic Safety Administration have settled the agency’s investigation into how the automaker handled recalls for 1.4 million vehicles. The agreement states Mercedes will pay $20 million – $13 million now with a possible $7 million due if the German automaker fails to comply with the agreement.?
The NHTSA’s investigation into Mercedes started last year, focusing on how Mercedes handles several aspects in regards to vehicle recalls. The settlement satisfies the agency’s investigation into how Mercedes not only failed to notify owners of some recalls in a timely fashion but also failed to issue two recalls in a timely manner, according to Automotive News Europe. The agency also looked into how Mercedes failed?to submit all necessary recall reports.
Mercedes said in a statement that it doesn’t believe it deliberately made mistakes; however, the company admitted it missed deadlines in notifying the NHTSA, according to the publication. Acting NHTSA Administrator James Owens said in a statement announcing the agreement, “Safety is NHTSA’s top priority, and the agency’s reporting requirements help ensure that consumers are protected and given important information about how to get recalls repaired.”
Over the next year, Mercedes will meet quarterly with the NHTSA to discuss the automaker’s progress in reforming its recall process. The NHTSA has the option to extend the agreement for an additional year under certain conditions. Failing to meet the NHTSA’s requirement could see Mercedes paying the deferred $7 million.?
Mercedes $13 million settlement is no drop in the financial bucket, but safety should be a top priority for automakers. Failing to notify owners or failing to issue recalls in a timely fashion could be not only dangerous but deadly, too. The steep fine should put other automakers on notice about reporting recalls to the agency and owners in a timely manner.?