The company also must spend $7 million on measures to improve child seat safety, including better programs to register seat owners so they can be notified of safety problems and better procedures to identify problems and speed up recalls.
The fine stems from a National Highway Traffic Safety Administration investigation into the company's behavior in the largest child seat recall in U.S. history. Graco Children's Products recalled 6.1 million car seats last year because the buckles could get stuck. That could put a child's life at risk in an emergency. The agency and the car seat maker were involved in an extended dispute over the recall.
"We accept this fine and the additional funding requested by NHTSA for a joint venture involving child passenger safety initiatives in the future.
Laurel Hurd, president of Graco Children's Products, said in a statement the company regretted that it fell short of NHTSA's expectations for data collection and reporting procedures.
"We accept this fine and the additional funding requested by NHTSA for a joint venture involving child passenger safety initiatives in the future," Hurd said.
Federal rules require a manufacturer to report a safety defect within five days of becoming aware of it.
When Graco, a subsidiary of Atlanta-based Newell Rubbermaid (NWL)), recalled 4.2 million toddler seats in February of 2014, NHTSA sent a sternly worded letter that questioned why infant car seats weren't included. It accused the company of soft-pedaling the recall with "incomplete and misleading" documents for consumers. The company gave in to regulatory pressure and recalled 1.9 million infant car seats last July.