THE threat of swingeing fines are driving car manufacturers to a five year high of vehicle recalls, according to an international law firm.
Recalls of motor vehicles models posing a serious safety risk are at their highest since 2010, according to an analysis by Pinsent Masons.
Research found that last year, 195 recalls for motor vehicle models were issued, more than at any point in the last five years.
Pinsent Masons says the increase demonstrates the increasing pressure on manufacturers to be proactive about dealing with vehicle problems, motivated by recent events in the US. Honda’s record $70M (£46M) fine for inadequate reporting of fatalities, injuries and warranty claims has left car makers in no doubt that regulators are taking a stronger approach to enforcing penalties.
Manufacturing and selling motor vehicles suffering from safety defects can have extensive reputational, financial and legal implications
Germany say the greatest leap in recalls, where 90 cases of unsafe vehicle models were identified, up from just 3 in 2010 as manufacturers seek to react to the increasing risk from regulators.
While in the UK, just 27 notifications for vehicle recalls were identified in 2014.
The firm says that manufacturers will be working harder to mitigate the volume of product recalls in 2015 but that the increasing complexity of modern cars may create different challenges.
“Manufacturing and selling motor vehicles suffering from safety defects can have extensive reputational, financial and legal implications for automakers and their suppliers.
Honda is a prime example; it’s faced questioning for over 1,700 unreported death and injury claims and recalled more than five million vehicles in the US since 2008 as a result of faulty air bags made by Takata,” said Andrew Masterson, partner at Pinsent Masons.
“Automotive manufacturers are aware that regulatory scrutiny is only going to get more intense, so they’ll be looking at how they can further limit the number of vehicles which are found to pose a risk to consumers. A lot of recalls arise owing to problems with low value components of which inevitably there are very many in a typical vehicle. We can expect to see an increased focus on quality assurance especially in relation to sub-assembly suppliers as manufacturers look for better visibility over the quality and traceability of their sub-components.”
