U.S. Legislative Issues

 

  

In light of Volkswagen’s (VW) admission that it rigged nearly eleven million vehicles to cheat emissions tests, the company announced it would offer a combination of cash and dealership credit as a "gesture of goodwill" to owners of 2.0L TDI vehicles. On January 11, the company announced it would expand their goodwill program to owners of 3-liter diesel engine vehicles as well. (For more information on this, go to https://www.vwdieselinfo.com/goodwill_package.) The compensation package totals $1,000, $500 of which comes in the form of a prepaid debit card and $500 of which can be put toward goods or services at a VW dealership as well as 24-hour roadside assistance for three years. Owners or lessees of vehicles sold as a Volkswagen corporate fleet sale are excluded from the goodwill package.

The move to expand the program precedes a key meeting scheduled for January 13 between VW Chief Executive Matthias Müller and U.S. Environmental Protection Agency (EPA) Administrator Gina McCarthy in which VW said it would present a package solution to fix the more than 500,000 faulty diesel vehicles sold in the U.S. Since its admission last September, VW has been involved in tense negotiations with U.S. regulators over owner compensation and the details of a recall remedy to repair the vehicles.

In a letter sent to VW President and CEO Michael Horn, Senators Richard Blumenthal (D-CT) and Edward Markey (D-MA), emphasized the crucial need for VW to provide generous offers to owners to encourage widespread participation in the compensation program and to ensure cars emitting toxic air pollutants are returned or repaired as "Volkswagen owes it to the public to make sure that robust incentives are in place that will keep polluting cars off of roads."

 

The National Highway Traffic Safety Administration (NHTSA) announced in late December that it was expanding its Takata Airbag recall to include four additional models due to passenger-side inflators rupturing during recently conducted ballistic testing. The new additions include: MY 2005-2008 Mazda6, MY 2002-2004 Honda CR-V, MY 2005-2008 Subaru Legacy, and MY 2005-2008 Subaru Outback. NHTSA reports that only 27 percent of the approximately 19 million recalled cars have been fixed. 

The agency also announced the appointment of an independent monitor to oversee Takata’s response. This move comes amid the lack of progress made in completing recalls and the latest confirmed fatality linked to a rupturing Takata air bag – bringing the total to eight U.S deaths plus another one worldwide and more than 100 injuries. 

 

National Highway Traffic Safety Administration (NHTSA) Administrator Mark Rosekind told reporters this month that the process of issuing government regulations to correct safety problems takes too long and that the current system prevents new life-saving technology from getting into cars quickly. In light of these concerns, Rosekind alluded to a deal reached by 12 automakers that involves adopting safety culture changes and technology voluntarily rather than going through the lengthy rule-making process, increasing the percentage of recalls that are being completed and being more proactive in preventing and reporting safety defects.

Discussions to cement an agreement grew out of a meeting with Secretary of Transportation Anthony Foxx and automakers in Washington in early December. A few weeks after the meeting, Secretary Foxx told reporters that he hoped to announce a new effort to improve the safety culture of the auto industry based on a management philosophy known as Safety Management Systems, or SMS. The Federal Aviation Administration has promoted the philosophy and it’s embraced by most airlines today. SMS involves more openness and collaboration between government and industry to identify safety risks before they become problems. Rosekind gave few details on the agreement but said people would see "actions going forward that change the culture of the industry."