U.S. extends GM safety oversight for additional year

Tue May 17, 2016 8:03pm EDT
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By David Shepardson

WASHINGTON (Reuters) - U.S. auto safety regulators will oversee General Motors Co's decision-making about potential vehicle safety issues for another year, until May 2017, the National Highway Traffic Safety Administration (NHTSA) told the automaker in a letter made public on Tuesday.

The Detroit automaker agreed to monthly meetings and enhanced oversight in 2014 and was fined $35 million by NHTSA over its delayed response to an ignition switch defect in millions of vehicles that was linked to 399 deaths and injuries. The agency in a Friday letter, which was reviewed by Reuters, exercised its right to extend the agreement for a third and final year.

GM's costs related to the ignition switch defects topped $2 billion, including a $900 million settlement with the U.S. Justice Department in September 2015, which also included a separate three-year consent decree and oversight by an outside independent monitor.

Under the 2014 agreement with NHTSA, GM must provide a written list every month of all safety issues under review by the automaker's investigators - often before the company decides whether to launch a recall.

Other automakers do not typically need to disclose safety issues until they determine the issues pose an unreasonable risk to drivers and vehicles must be recalled.

NHTSA said in its letter Friday that GM shares its belief that the meetings "have been useful to proactively and expeditiously address potential safety-related defects and to facilitate communication."

GM spokesman Jim Cain said the automaker is committed to working closely with NHTSA.

"We have worked hard to build a productive and highly effective working relationship with the agency," Cain said.   Continued...

The GM logo is seen at the General Motors Warren Transmission Operations Plant in Warren, Michigan October 26, 2015.   REUTERS/Rebecca Cook