Auto Defect Claims on the Rise
Written By: Rheingold, Valet, Rheingold, Ruffo & Giuffra LLP
When motorists have concerns about potential defects in their vehicles, they submit a report to the National Highway Traffic Safety Administration (NHTSA). In 2010, over 40,000 unique complaints were registered with the agency, four times the usual amount received.
Many high-profile problems impacted the auto industry this past year, which led to greater awareness on the part of consumers. When motorists experienced issues, they knew how to research their concerns and then submit this information to the proper places. Some of these defects resulted in serious accidents due to stuck accelerators, potentially causing speed to increase until the vehicle collided within something.
Many of the claims submitted this year were related to Toyota. The automaker was responsible for more than 10,000 claims submitted to NHTSA. In a normal year, there would be roughly 37 claims per 100,000 Toyotas sold. This year, that number rose to 87 per 100,000. This trend is reflected industry-wide, as there were 47 claims per 100,000 vehicles sold, compared to 30 complaints per 100,000 in 2009.
While Toyota's problems received most of the media attention, there were other serious issues present, impacting a range of domestic and foreign manufacturers. Some vehicles had defective engine bolts, causing engine blocks to crack. Other reported issues include defective brakes, transmission problems and malfunctioning headlights.
When a defect is reported, the agency conducts an investigation to determine if the problem is isolated to one particular vehicle, or if it is part of a trend. Multiple reports of the same defect could result in a recall being issued by manufacturers. Research firm Edmunds.com reports that over 19 million vehicles were recalled in 2010, the most since 2004.
With the number of auto defect claims on the rise, motorists could find themselves being placed in harm's way. Manufacturers have been forced to pay fines for failing to report defects, and the number of fines could increase if automakers fail to address safety concerns.