FIAT SETTLES
Automaker to pay an estimated $800M in fines and costs associated with recalls,
Fiat Chrysler Automobiles NV will pay an estimated $800 million (U.S.) in fines and costs related to recalling and fixing thousands of vehicles under civil settlements announced Thursday by California and the U.S. Justice Department, which alleged some of its diesel-powered vehicles violated clean-air rules.
“A multinational corporate bad actor seriously violated American emissions laws to the detriment of the health and welfare of the people of the United States,” said Jeffrey Bossert Clark, assistant attorney general for the Justice Department’s environment and natural resources division.
“That is a very serious offence.”
The total costs of the settle- ments to Fiat Chrysler could top $800 million, based on the settlements with the U.S. government, California, and consumers. The total $307.5 million consumer settlement — with Fiat Chrysler responsible for as much as $280 million — is based on100 per cent participation by consumers, so is likely to be a lower number.
Consumers will get an average of $2,800 per vehicle in compensation, according to Fiat Chrysler.
German parts supplier Robert Bosch GmbH has also agreed to pay up to $27.5 million as part of the settlement with consumers. It will also pay a total of $103.7 million to 50 jurisdictions, according to Maryland Attorney General Brian Frosh.
The settlements mark a milestone in the second major case brought by U.S. officials against an automaker for Clean Air Act violations stemming from diesel vehicles equipped with pollution controls prohibited by U.S. law.
In January 2017, Volkswagen AG pleaded guilty to criminal charges and agreed to pay some $4.3 billion in U.S. penalties for its scheme to deliberately rig hundreds of thousands of U.S. diesel vehicles to cheat on emissions tests. The VW scandal extended to some 11 million other vehicles the company sold worldwide, and led to U.S. criminal charges against eight people. The company has set aside more than $30 billion to cover costs and settlements, including $15 billion to buy back or fix vehicles in the U.S.
Fiat Chrysler won’t have to admit wrongdoing, according to the documents. It will pay owners of roughly 104,000 diesel-powered SUVs and pickups to update the emissions soft- ware on the vehicles via a recall, according to a consumer consent decree filed Thursday in federal court in California. “The settlements do not change the company’s position that it did not engage in any deliberate scheme to install defeat devices to cheat emissions tests,” the automaker said in a statement. “The consent decree and settlement agreements contain no finding or admission with regard to any alleged violations of vehicle emissions rules.”
The pact will resolve civil claims by the Justice Department on behalf of the U.S. Environmental Protection Agency that some Jeep Grand Cherokee and Ram 1500 models contain pollution-control software that improperly limits pollution during lab tests while allowing the vehicles to spew excess emissions on the road.
Fiat Chrysler has also agreed to corporate governance reforms intended to prevent future emissions violations under the agreement.