Hyundai and Kia have agreed to pay $100 million to resolve federal charges that they allegedly violated the Clean Air Act by understating by about 4.75 million metric tons of greenhouse gases how much 1.2 million vehicles would emit.
The fine is the largest in the law’s history, the U.S. Environmental Protection Agency and U.S. Department of Justice said Monday.
The companies will also will forfeit 4.75 million greenhouse gas emission credits, estimated to be worth more than $200 million, which auto companies earn by building vehicles with lower emissions than are required by law.
“This settlement upholds the integrity of the nation’s fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact,” said EPA Administrator Gina McCarthy.
The lawsuit alleges that the car companies sold nearly 1.2 million cars and SUVs from model years 2012 and 2013 whose design specifications didn’t conform to the specifications the companies certified to EPA. This led to misstatements of greenhouse gas emissions.
The vehicles involved were the Hyundai Accent, Elantra, Veloster, and Santa Fe vehicles and the Kia Rio and Soul vehicles.
In addition, Hyundai and Kia gave consumers inaccurate information about the fuel economy performance of many of these vehicles, the EPA said.
Hyundai and Kia overstated the fuel economy by one to six miles per gallon, depending on the vehicle.
They understated the emissions of greenhouse gases by their fleets by about 4.75 million metric tons over the estimated lifetime of the vehicles.
EPA discovered the violations in 2012 during audit testing. A later investigation showed that Hyundai’s and Kia’s testing included procedures that led to higher fuel economy ratings. In processing test data, Hyundai and Kia allegedly chose favorable results rather than average results from a large number of tests, the EPA said.
In November 2012, Hyundai and Kia responded to EPA’s findings by correcting the fuel economy ratings for many of their 2011, 2012, and 2013 model year vehicles and setting up a reimbursement program to pay owners for increased fuel costs due to overstated fuel economy.
Luke Tonachel, senior vehicles analyst at the Natural Resources Defense Council, said consumers deserve accurate information on emissions and fuel economy when they go to the showroom.
“This strong action by EPA and the Department of Justice should deter other automaker from cheating and will help ensure that consumers get the accurate information they need to make informed choices.
Tonachel said thanks to the 54.5 mpg clean car and fuel economy standards, car shoppers have more choices of fuel-saving vehicles.
