New Rules: U.S. Motorists To Be Reimbursed for Pre-recall Repairs

October 18, 2002

WASHINGTON, Reuters reported that auto and auto equipment makers will soon be required to reimburse motorists who paid to fix or replace defects that were later the subject of recalls, the U.S. government said Thursday.

The National Highway Traffic Safety Administration rule takes effect in January and stems from new consumer and safety regulations ordered by Congress after Firestone tire defects linked to deadly crashes.

Under the rule, manufacturers must submit reimbursement plans to regulators for approval. Industry has some latitude for determining reimbursement amounts and can, in some cases, reject claims. Approved claims must be processed by manufacturers within 60 days.

Defects in certain tires of Firestone, a unit of Japan's Bridgestone Corp. were linked to deadly crashes in recent years, prompting two massive recalls and close scrutiny of how the industry and government address defects.