I don't think so. Besides, I think their headline is misleading. The story says they'll impound the car, then issue a fine. Does impound mean hold it until you pay the fine, or take permanent possession of it?
In any case, I think banning installation is valid as a safety regulation. How can you possibly concentrate on driving safely if your brain (tiny and drug addled as it might be) is vibrating inside your head?
And the next thing we know, we will be having to pay for all these pea-brains' hearing aids.
The ambulance crews noticed that a lot of people who wouldn't move over also had their car stereos at a very high volume. So high, in fact, that they couldn't hear the sirens blaring behind them. That's a very definite public safety issue.
It could also be argued that it's a distraction for pedestrians because a loud obnoxious car stereo detracts from their situational awareness. You're not supposed to walk city streets or drive with headphones, so why is it okay to play your stereo so loud that you can't hear anything going on outside the car and cause other people to not hear things around them?