Fiat Chrysler Issued Fine, Launches Recall

July 27, 2015

July 27, 2015—Fiat Chrysler Automobiles has been issued a $105 million fine by the National Highway Traffic Safety Administration (NHTSA) and launched a separate recall to attempt to shield its vehicles from computer hackers, according to reports by USA Today.

As part of the deal with NHTSA, Fiat Chrysler will also be required to buy back a limited number of vehicles, offer incentives for owners to participate in recall repairs, and be subject to independent monitoring to ensure its safety program continues to meet minimum standards. Fiat Chrysler has acknowledged its violations of the Motor Vehicle Safety Act’s requirements to repair vehicles with safety defects. Anthony Foxx, U.S. Transportation secretary said that Fiat Chrysler will submit to “rigorous federal oversight” and the possibility for a reduced fine will be available if Fiat Chrysler shows good faith in adhering to terms of the agreement.  

The agreement is the culmination of NHTSA’s campaign against Fiat Chrysler's handling of 23 recalls involving 11 million vehicles that led to 1,729 injury and death reports. Fiat Chrysler must pay a $70 million cash penalty and spend at least $20 million on meeting performance requirements included in the Consent Order. Another $15 million could be due if additional violations of the Safety Act or the Consent Order are found.

On Friday, Fiat Chrysler launched a giant recall to shield its vehicles from computer hackers. The automaker ordered a voluntary safety recall on 1.4 million vehicles to update software in the infotainment system to prevent the possibility of hacking.

Shortly after the recall announcement, NHTSA said it would be launching an investigation to assess whether Fiat Chrysler's recall will be effective.

"Launching a recall is the right step to protect Fiat Chrysler's customers, and it sets an important precedent for how NHTSA and the industry will respond to cybersecurity vulnerabilities," NHTSA Administrator Mark Rosekind said in a statement.

The recall comes after a demonstration by Wired magazine where two hackers took control of a Jeep SUV and operated in remotely. The car ended up in a ditch.

Fiat Chrysler said the recall “aligns with an ongoing software distribution that insulates connected vehicles from remote manipulation, which, if unauthorized, constitutes criminal action."

The recall applies to certain vehicles equipped with 8.4-inch touchscreens. They include: 2013 to 2015 Dodge Vipers and Ram pickups; 2014 to 2015 Jeep Grand Cherokee, Cherokees and Dodge Durango SUVs; and 2015 Chrysler 200, Chrysler 300 and Dodge Chargers and Challengers.

Fiat Chrysler applied network-level security measures on Thursday to prevent the type of remote manipulation demonstrated by Wired.