Bloomberg News

Volvo Faces $1.5 Million U.S. Fine for Not Baring Defects

July 03, 2012

-- Volvo Car Corp. (175), the Swedish carmaker owned by China’s Zhejiang Geely Holding Group Co., was fined $1.5 million by U.S. auto-safety regulators for failing to report safety defects.

Volvo, based in Gothenburg, Sweden, didn’t disclose six defects that led to recalls in 2010 and one this year within five business days of determining that a safety flaw exists, as required by U.S. law, the National Highway Traffic Safety Administration said today in a statement posted on its website.

“It’s critical to the safety of everyone on our roadways that automakers promptly report safety defects -- and take immediate action to resolve the issue,” NHTSA Administrator David Strickland said in the statement. “NHTSA expects all manufacturers to obey the law and address automotive safety concerns without delay.”

The recalls included tires that weren’t properly labeled, gearshift levers that can become loose and air bags that may not deploy in a crash.

“After several conversations with NHTSA about its reporting rules, Volvo Car Corp. has taken steps to improve the review process and analysis of potential quality and safety issues with our vehicles,” Laura DiStefano, a U.S.-based spokeswoman for Volvo, said in an e-mail.

“We are in agreement with NHTSA’s objective to communicate with the agency and consumers in a timely manner,” DiStefano said. “It’s important to note that, in each of the subject cases, a voluntary recall had been conducted and no injuries, fatalities or property damage claims were reported.”

Toyota Motor Corp. (7203) paid record fines to NHTSA of $48.8 million in 2010 for failing to recall in a timely manner models affected by defects related to unintended acceleration.

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net


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