Product Liability

All Top Three Automakers Now Under U.S. Regulatory Observation

auto industry regulation money justice Shutterstock 321x210 All Top Three Automakers Now Under U.S. Regulatory ObservationVolkswagen’s $4.3 billion settlement of criminal and civil penalties resulting from its emissions fraud subjects the German automaker to three years of probation and daily regulatory scrutiny. Now, with the VW deal, the world’s top three automakers are under close federal oversight to ensure their compliance with auto rules and regulations.

On April 21, federal judge Sean Cox in Michigan approved a $4.3 billion criminal and civil settlement reached between the U.S. government and Volkswagen six weeks prior. Part of that deal puts the automaker under the watchful eye of an independent, court-approved monitor.

Toyota, the world’s leading auto manufacturer, was also subjected to the close oversight of an independent monitor in March 2014, after it plead guilty to misleading U.S. regulators and customers about safety issues surrounding sudden unintended acceleration in millions of its top-selling vehicles.

Toyota remains on probation to ensure compliance with U.S. safety rules and regulations until August 2017 or longer if necessary.

In September 2015, General Motors pleaded guilty to covering up its deadly ignition switch defect, concealing the flaw from both U.S. regulators and customers for more than a decade. The $900-million deal it struck with the U.S. also put it under the scrutiny of an independent auditor through 2018.

Meanwhile, as Forbes notes, Japanese auto supplier Takata is also under constant regulatory oversight in the U.S. after pleading guilty in January for knowingly selling defective airbags that can explode with lethal force.

In the case of Toyota, General Motors, and Takata, corporate wrongdoing had fatal consequences. CBS News reported that federal regulators linked Toyota’s sudden unintended acceleration flaw to 89 deaths. General Motors compensated survivors for 124 deaths that resulted from its faulty ignition switches. Takata airbags have been linked to 11 deaths in the U.S. and nearly 200 injuries.