NHTSA Seeks to Push Beyond the “New Normal” and into the “New Paradigm” - National Highway Traffic Safety Administration
In recent years, the National Highway Traffic Safety Administration (NHTSA) has received increased public and Congressional scrutiny stemming from high-profile safety defects, such as the Toyota unintended-acceleration issues and last year’s GM ignition-switch issue. On June 5, 2015, NHTSA released two reports – the agency’s “Path Forward” and its “Workforce Assessment: The Future of NHTSA’s Defect Investigations” – which detail process changes and workforce increases the agency is pursuing in the wake of these recent activities. Additionally, the Secretary of Transportation announced the formation of a three-person “Safety Systems Team” (SST) of outside experts who will assist NHTSA in implementing the changes outlined in the agency’s “Path Forward” report.
NHTSA’s “Path Forward” walks through a post mortem of the GM ignition-switch recall, drawing a number of lessons the agency learned from the experience. NHTSA believes that a key failing in its investigation was that it did not understand the interaction between vehicle systems. In particular, NHTSA did not realize that the air bag system was not powered when the ignition switch was in auxiliary mode – a design that apparently was not shared by many other advanced air bag systems. NHTSA worries that as the number of advance-technology systems in vehicles increases, the potential for difficult-to-detect interactions among vehicle systems could increase.
To combat a potential yawning knowledge gap, NHTSA outlined six key process improvements it is undertaking.
- Increase the accountability of the automotive industry. As part of the Department of Transportation’s GROW America Act, NHTSA is seeking Congressional authority to increase the maximum civil penalty to $300 million. Additionally, NHTSA plans to send vehicle manufacturers and suppliers “pre-investigative notices” of issues it is monitoring. For incidents involving fatalities and litigation, NHTSA will now require copies of settlement documents, including suits settled by suppliers, hoping to ferret out potential defect theories. In addition to requiring settlement documents, NHTSA has also begun an outreach program to the plaintiff’s bar seeking potential defect theories and related information. Moreover, NHTSA will continue to require what it terms “enhanced oversight” of manufacturers that fail to timely report a defect or noncompliance, similar to the oversight used in recent Consent Orders. NHTSA also recommends that manufacturers regularly audit their internal processes, while threatening that it has the authority to conduct these audits if necessary.
- Increase NHTSA’s Knowledge-Base of New and Emerging Technologies. NHTSA plans to meet with the industry to increase its working knowledge of new and emerging technologies and their interaction with other vehicle systems. Armed with this knowledge, NHTSA plans to develop a set of screening and investigation questions, which could become a standard part of information requests and special orders to manufacturers.
- Enhance ODI’s System Safety Approach to Detections and Analysis. In conjunction with the increase in its knowledge base, NHTSA intends to include, as a standard part of its investigations, consideration of whether one possible defect is a symptom of defect in another system.
- Enhance Information Management, Analysis, and Sharing. NHTSA is developing an internal system that will allow it to better analyze the information streams that the agency receives (e.g., EWR data, DI (death and injury) reports and inquiries, Special Crash Investigation (SCI) reports, vehicle owner questions, etc.).
- Establish Improved Controls for Assessing Potential Defects. For issues that do not advance to a formal investigation, NHTSA will require periodic review of the issue by the agency’s defect assessment panel.
- Ensure Effective Communications and Coordination within the Office of Defects Investigation (ODI) and between ODI and the SCI Division. NHTSA is promoting a more collaborative environment between ODI (NHTSA’s investigative office) and SCI (which resides within another office in the agency). Additionally, NHTSA is launching what it calls the Risk Control Innovations Program, which will involve “multi-disciplinary teams from across NHTSA” to analyze “its toughest safety challenges.”
NHTSA paired its “Path Forward” with its “Workforce Assessment: The Future of NHTSA’s Defect Investigations.” The assessment calls for significant increases in staff and budget for defect investigations under two scenarios. The first scenario reflects NHTSA’s Fiscal Year 2016 budget request for an immediate increase of 92 additional full time equivalent (FTE) employees among ODI, ODI trend analysis division, and the Office of Chief Counsel (81, 3, and 7 respectfully). The relatively modest increase of this first scenario reflects what the agency believes it needs to keep pace with the current enforcement environment, which NHTSA has previously called its “New Normal.”
The second scenario represents a dramatic increase in resources to support what the agency describes as a “New Paradigm” of defects investigation. Under the “New Paradigm”, NHTSA envisions upping its staffing and investigation budget to support 380 new FTEs (322 in ODI, 14 in ODI’s trend analysis division, and 44 to the Office of Chief Counsel) in addition to the current 64 FTEs in those offices.
Armed with these resources, NHTSA details what it envisions the “New Paradigm” will look like. NHTSA would:
- Push to find and act on potential safety defects more quickly by requiring manufacturers to provide the agency with “their entire lists of pending safety issues” similar to what has been done in recent Consent Orders;
- Investigate manufacturing programs and processes at the plants;
- Regularly audit manufacturers’ defect investigation and Early Warning reporting (EWR) processes with an eye to finding untimely defect determinations and underreported Early Warning reports;
- Utilize state-of-the-art software to analyze incoming data and to manage investigations;
- Follow-up with significantly more consumers who submit complaints (vehicle owner questionnaires or VOQs) with the agency, including contacting each consumer that files a VOQ that alleges a death or injury;
- Investigate alleged vehicle defects in the field using teams akin to the NTSB’s “Go Team”;
- Deeply analyze death and injury reports by seeking more information in DI Inquiries;
- Conduct hundreds more investigations every year, “regardless of whether the overall risk appears high”;
- Test recall remedies before manufacturers implement them;
- Pursue more cases through the agency’s full process to the point of a recall order and supporting litigation, because “the threshold for establishing risk would be much lower”;
- Pursue more enforcement actions including civil penalty actions for timeliness violations;
- Significantly expand its scrutiny of EWR reporting, “including extensive research and outreach and filing special orders to ferret out incidents that were not reported”; and
- Continue the evolution of its Consent Orders to settle potential violations, which have included enhanced oversight and spending on public campaigns.
While the reports dovetail with recent enforcement actions and the Department’s proposed legislation, it also represents an acceleration of the shift from the enforcement practices of the recent past. Over the past year, NHTSA’s “New Normal” has emphasized its enforcement and regulatory priorities in early detection of potential safety issues, speeding up the reporting of defects, and improving recall remedy rates. These reports suggest that NHTSA’s “New Normal” may just be a stepping stone to the “New Paradigm.” Manufacturers need to ensure that their current policies and practices are robust enough to meet this heightened scrutiny.