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Expect a busy year for NHTSA rulemaking and enforcement

2014 is set to bring strict enforcement of distraction, crash avoidance and recall policy. By Christopher Grigorian, partner at Foley & Lardner LLP

We can expect 2014 to be a busy year for NHTSA rulemaking and enforcement activity. The agency is set to push forward with research and possible rulemaking on advanced crash avoidance technologies, driver distraction, and autonomous vehicles, and with implementing enhancements to its recall processes. It is also likely to continue its aggressive enforcement, buoyed by the recent doubling of the statutory civil penalty maximum and the threat of criminal penalties. To reduce their compliance risks, and to prepare themselves and their products to meet these new regulatory developments, manufacturers are urged to update their safety compliance policies and to implement regulatory monitoring programmes.

NHTSA recall label

In terms of crash avoidance technologies and autonomous vehicles, NHTSA has been carefully studying the safety benefits of various warning technologies. These include blind spot detection and advanced lighting; intervention technologies, such as lane departure prevention, crash imminent braking (CIB), and dynamic brake support (DBS); and automatic pedestrian detection and braking. It has also been studying vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communications as a way to improve the effectiveness of these systems.

The agency has indicated that it will decide next steps after analysing research data, and if the safety benefits outweigh the costs, it could propose requiring these systems in vehicles. NHTSA has also been actively researching autonomous vehicles to position itself to regulate them should they become commercially available, and we expect it to continue devoting substantial resources in this area.

Driver distraction is another area of focus for NHTSA. Last year, NHTSA adopted the first of its three-phase federal guidelines to address driver distraction from in-vehicle electronics. That phase applies to original equipment in-vehicle electronic devices used by the driver to perform secondary tasks, such as communications, entertainment, and navigation, through to visual-manual means. The agency is proceeding this year with subsequent phases, which will cover portable and aftermarket devices and auditory-vocal interfaces. Although these guidelines are ‘voluntary’, they are expected to significantly influence the design and performance of such devices in future model years.

In response to Congressional mandates and the agency’s own internal review, NHTSA is rolling out significant enhancements to its recall processes this year. These enhancements – which include a new recall lookup system to enable consumers to search recalls by VIN, new requirements governing owner communications, and required electronic submission of defect correspondence – are intended to streamline the recall process and increase recall completion rates, which have averaged 70% recently.

Significantly, we expect NHTSA to continue the aggressive enforcement approach witnessed in recent years, with a particular emphasis on recall timeliness. Manufacturers should take note that NHTSA asserted the maximum penalty against manufacturers at least five times since 2010. Last year, the civil penalty maximum doubled to US$35m, so we will not be surprised to see penalties in that range soon. A significant new concern for manufacturers is the potential for criminal liability, as recently seen in the recent Toyota deferred prosecution agreement, which included a US$1.2bn penalty. And the industry may face new enforcement regulations and even higher penalties as a result of Congressional response to the GM ignition switch investigation and hearings.

In light of these risks, it is critical that manufacturers adopt compliance policies that provide the necessary internal guidance for identifying, investigating and reporting safety defects.

This article appeared in the Q2 2014 issue of Automotive Megatrends Magazine. Follow this link to download the full issue


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