Daimler Trucks North America faces a £21.94 million civil penalty from the U.S. NHTSA
- Daimler Trucks North America faces a £21.94 million civil penalty from the U.S. NHTSA.
- The German automotive corporation will meet with NHTSA at least once every month.
- Daimler will pay £7.31 million upfront and invest another £3.66 million in safety projects.
Daimler Trucks North America (ETR: DAI) said on Thursday that it will pay a civil penalty worth £21.94 million in the United States to settle an NHTSA (National Highway Traffic Safety Administration) launched investigation of delayed recalls.
Daimler has recovered sharply from a low of £19.71 per share in March when the COVID-19 crisis brought the global automotive demand to a near halt. At the time of writing, the stock is exchanging hands at £52.16 per share. The German company had started 2020 at a per-share price of £45.11. Learn more about the financial analysis of a company.
The settlement requires Daimler to pay £7.31 million upfront
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The announcement marks the second time for the German automaker since late 2019 to have resolved a regulatory probe in the U.S. Previously, Daimler Mercedes-Benz USA paid £14.63 million in a civil penalty in December 2019.
According to the auto safety regulator, Daimler’s North American truck unit failed to comply with reporting requirements. It delayed recalling vehicles after the NHTSA launched an investigation on roughly 464 thousand vehicles in April 2018. The news comes months after Daimler said that its net profit jumped to £1.87 billion in the fiscal third quarter.
Following an upfront payment of £7.31 million, Daimler Trucks will invest another £3.66 million on advanced data analytics program and other related projects that will be developed and implemented to enhance safety. The settlement also includes a deferred penalty valued at £10.97 million that the German automaker will have to pay if it breaches the consent order.
Daimler to meet with NHTSA at least once in a month
Daimler Trucks also reiterated its commitment to building reliable commercial vehicles, keeping safety as its utmost priority on Thursday. The North American unit confirmed that none of the vehicles under investigation were involved in an accident or an injury.
The settlement requires the German multinational to meet with the U.S. auto safety regulator at least once every month. Deputy Administrator James Owens of NHTSA said in a statement on Thursday:
“It’s critical that manufacturers appropriately recognise the urgency of their safety recall responsibilities and provide timely and candid information to the agency about all safety issues.”
Daimler performed fairly upbeat in the stock market in 2020 with an annual gain of more than 15%. At the time of writing, the Stuttgart-based automotive corporation is valued at £56.35 billion and has a price to earnings ratio of 1,873.26.