Fiat Chrysler Automobiles will pay about US$800 million in fines and costs to settle lawsuits brought by states, car owners and the U.S. Justice Department, which said the company’s diesel-powered pickups and SUVs 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 offense.”
The Italian-American carmaker’s penalties include a $305 million U.S. fine, more than $200 million for recall repairs and environmental mitigation as well as its $280 million portion of a $307.5 million consumer settlement. That estimate is based on 100 percent participation by consumers, which may not be achieved.
German parts components-maker Robert Bosch GmbH, which supplied the engine control devices found to be rigged to pass emission tests, will pay $27.5 million as part of the settlement with consumers. In addition, it agreed to pay a total of $103.7 million to 50 jurisdictions, according to Maryland Attorney General Brian Frosh.
Fiat Chrysler will pay owners of roughly 101,000 diesel-powered Jeep Grand Cherokee and Ram 1500 models to update the emissions software for free via a recall, according to a consumer consent decree filed Thursday in federal court in California. Consumers will get an average of $2,800 per vehicle from Fiat Chrysler, according to the automaker.
The pact does not resolve any potential criminal liability associated with the emissions violations, the Justice Department said in a statement. Prosecutors have an ongoing criminal probe of Fiat Chrysler that was opened in 2017, Bloomberg has reported.
The case is the second major action brought by U.S. officials against an automaker for Clean Air Act violations stemming from the discovery that diesel vehicles were rigged to pass emissions tests in labs even though they spewed nitrogen oxide in excess of permitted levels while on the road. The first involved Volkswagen.
Fiat Chrysler reassured regulators for three years that the vehicles adhered to emissions rules even though they didn’t, said Jesse Panuccio, a senior Justice Department official, telling reporters the company’s conduct was “serious and egregious.”
The settlement doesn’t require Fiat Chrysler to admit wrongdoing.
“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.”
Fiat Chrysler has also agreed to corporate governance reforms intended to prevent future emissions violations under the agreement. To mitigate the vehicles’ excess emissions, Fiat Chrysler will also provide funds and work with a catalytic converter manufacturer to offer drivers better emissions reductions when they replace that part.
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