Ford Motor Co. has been hit with a $17.35-million penalty by federal safety regulators for taking too long to recall nearly half a million Escape sport utility vehicles in 2012.
The National Highway Traffic and Safety Administration agreed to the settlement with Ford rather than face “possible litigation” or a protracted public battle over the issue, according to the settlement signed by the two sides.
“This is very significant,” said Michelle Krebs, senior analyst at auto information website Edmunds.com. “What it says is that you don’t mess around with NHTSA.” While the fine isn’t an outright slap in the face for Ford, “it’s a very expensive swat on the hand,” Krebs said.
At issue was a 2012 recall of 423,634 Ford Escapes and Mazda Tributes from the 2001 to 2004 model years with V-6 engines. The vehicles were recalled to fix a throttle that could get stuck open, causing unintended acceleration.
The issue resulted in at least one death and nine injuries in related crashes, according to the NHTSA.
The agency said that Ford failed to notify owners, dealers, and the NHTSA of the defect in a timely manner, a violation of the National Traffic and Motor Vehicle Safety Act.
Ford, meanwhile, denied its actions violated the safety act.
“We are absolutely committed to addressing potential vehicle issues and responding quickly for our customers. We take the safety of our customers seriously and continuously evaluate our processes for improvements. While we are confident in our current processes for quickly identifying and addressing potential vehicle issues, Ford agreed to this settlement to avoid a lengthy dispute with the government,” Ford said in a statement.
Had the two sides not agreed to the settlement, which was signed June 28, it could have led to a bruising court battle for Ford.
Chrysler and the NHTSA seemed headed for such a courtroom confrontation in June over the automaker’s refusal to recall more than 2.7 million Jeep Cherokee and Grand Cherokee models for a fire risk. Chrysler ultimately relented and agreed to repair the vehicles.
This is the first time this year an automaker has been fined for dragging its feet in a recall. In 2012, Toyota was hit with the same $17.35 million penalty, while BMW and Volvo received smaller fines for slow recalls.