January 11, 2016
By David Shepardson
DETROIT (Reuters) – The U.S. government and a group of leading global automakers are set to announce a ground-breaking voluntary agreement at the Detroit auto show on Friday aimed at dramatically improving the industry’s safety, according to company officials.
The unprecedented accord could set the framework for further discussions on safety reforms and mark a new era of cooperation between automakers and regulators after a record-setting year of safety fines, recalls and investigations into malfunctioning vehicles made by General Motors Co <GM.N>, Fiat Chrysler Automobiles NV <FCAU.N>, Honda Motor Co <7267.T> and others.
The agreement, under discussion for several weeks, would also attempt to improve vehicle cyber security and the use of early-warning data to detect potential defects that might lead to safety problems or large-scale recalls, sources said.
The accord would be voluntary, but industry watchers said regulators would expect automakers to stick to their undertakings.
Automakers recalled a record-setting 63.95 million vehicles in the United States in 2014, incurring large fines from the U.S. National Highway Traffic Safety Administration (NHTSA).
Companies in the talks leading up to the agreement include GM, Toyota, Ford Motor Co <F.N>, Daimler AG <DAIGn.DE>, Fiat Chrysler, BMW AG, Honda, Nissan Motor Co <7201.T> and Hyundai Motor Co <005380.KS>.
Talks are continuing and no final agreement has been reached, sources said on Monday. It is not clear if all 16 automakers involved in discussions will take part in Friday’s announcement.
The agreement will be announced at the auto show in the U.S. auto capital of Detroit by U.S. Transportation Secretary Anthony Foxx and top auto executives, sources told Reuters.
In a letter last week to the NHTSA seen by Reuters, the group of automakers said industry support of an agreement “reaffirms our shared commitment to safety, and signals to the public the areas in which government and industry intend to collaborate to further improve automotive safety.”
Automakers met with the NHTSA in Chicago on Dec. 16 and since then exchanged proposed “Principles for Working Collaboratively to Enhance Motor Vehicle and Traffic Safety.”
In recent days, NHTSA and automakers have continued to propose revisions, including discussions about government-industry working groups, according to auto industry officials who spoke to Reuters at the Detroit show.
The talks come after NHTSA came under intense criticism in 2014 for failing to detect ignition switch defects in 2.6 million older GM cars linked to at least 124 deaths. Since then, NHTSA has been more aggressive in handing out fines and demanding outside monitors oversee automaker safety compliance.
NHTSA Administrator Mark Rosekind said on Monday in an interview on the sidelines of the Detroit show that the agency cannot make vehicles safe simply by imposing new regulations and handing down fines. He said he hoped a deal would be announced Friday.
“We’re going to have to find new tools – that means new collaborations, new partnerships,” Rosekind said.
But the voluntary agreement will not be enforceable – and may fall short of what some safety advocates have called for.
Foxx met with top executives from major automakers on Dec. 1 in Washington. A spokeswoman for Foxx said there have since then been “productive discussions with auto manufacturers toward agreement on steps to bolster safety.”
Foxx “is hopeful that they will soon result in concrete commitments that lead to significant safety improvements that will strengthen public confidence,” said his spokeswoman.
Fiat Chrysler CEO Sergio Marchionne said on Monday he agreed with the NHTSA that the auto industry needs more collaboration with regulators. He said he wanted the industry to “get to a stage where safety is no longer a competitive edge used by one automaker against another.”
(Reporting by David Shepardson; Editing by Bill Rigby)
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