Monday, 17 June, 2019

Fiat Chrysler Will Pay $800 Million to Settle Emissions Cheating Claims

Bill Pugliano  Getty Images The Chrysler world headquarters in Auburn Hills Mich Bill Pugliano Getty Images The Chrysler world headquarters in Auburn Hills Mich
Russell Knight | 11 January, 2019, 15:42

In a settlement announced Thursday by California officials, Fiat Chrysler Automobiles agreed to pay $500 million over charges that the global carmaker used "defeat device software" in thousands of diesel cars to cheat on air pollution tests. The settlement includes fines to the government, California regulators, compensation to vehicle owners as well as settlements with other states.

Under a deal with the Justice Department and the Environmental Protection Agency, the automaker will recall and fix the more than 104,000 out-of-compliance Jeep SUVs and Ram pickup trucks. The remaining $400 million covers a software update and payments to current and former vehicle owners in amounts that average $2800 per person. FCA also will pay another $400 million in total to the EPA, the U.S. Department of Justice (DOJ), CARB, all 50 states, and the U.S. Customs and Border Protection (CBP).

Under the deal, the company may be subject to additional penalties if at least 85 per cent of the vehicles aren't repaired within two years.

Wheeler and Deputy Associate Attorney General Jesse Panuccio said the settlement shows that the Trump administration will enforce environmental law and provide a level playing field for the majority of companies that do follow environmental rules and laws.

Fiat Chrysler will not admit wrongdoing as part of the civil settlement. The company will also pay a $305 (£239 / €265) million civil penalty and "implement a program to mitigate excess pollution from these vehicles".

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Fiat Chrysler shares were up 1.2 percent at $15.96 in NY near midday on Thursday. VW was found to have colluded with Bosch to pass US emissions only while its vehicles sensed they were being tested by federal agencies, while otherwise they operated in a completely different driving mode that polluted up to 40 times above the legal limit.

The settlement is the second between the USA government and an automaker over allegations of cheating on diesel emissions. The government says the software acted as a defeat device as it would fully activate emission controls during EPA and California emissions testing, but "reduce or deactivate emission controls" during real world driving.

The settlement is not expected to outline any criminal charges, according to ABC News.

Representatives for Fiat Chrysler and the Justice Department declined to comment.

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