Fiat Chrysler Automobiles will pay out more than $650 million to settle a case that alleged the automaker had cheated on diesel emissions, according to a report from the Associated Press. Over 100,000 Jeep SUVs and Ram pickup trucks are said to have been involved.
Apparently “a person with the knowledge of the settlement” told the AP Wednesday that FCA would face “$311 million in fines to the federal government and California regulators” as well as payouts of “$280 million to compensate vehicle owners” plus “$72 million to settle claims made by other states.”
Update Jan. 10, 2019 12:15 p.m. est: The U.S. Department of Justice has issued a press release laying out the penalties FCA will face more specifically:
Fiat Chrysler has agreed to implement a recall program to repair more than 100,000 noncompliant diesel vehicles sold or leased in the United States, offer an extended warranty on repaired vehicles, and pay a civil penalty of $305 million to settle claims of cheating emission tests and failing to disclose unlawful defeat devices. Fiat Chrysler also will implement a program to mitigate excess pollution from these vehicles. The recall and federal mitigation programs are estimated to cost up to approximately $185 million. In a separate settlement with California, Fiat Chrysler will pay an additional $19 million to mitigate excess emissions from more than 13,000 of the noncompliant vehicles in California. In addition, in a separate administrative agreement with the United States Customs and Border Protection, Fiat Chrysler will pay a $6 million civil penalty to resolve allegations of illegally importing 1,700 noncompliant vehicles.
That adds up to $515 million, which grows to over $815 million when you add in the settlements for consumers secured by the Plaintiffs Steering Committee. Owners of affected vehicles who are class members will receive between $990 and $3,075 each, which the DOJ says has an aggregate value of over $300 million.
The original AP report stated that the owners of affected vehicles should expect “about $2,800” each as part of the civil settlement.
In case you’ve forgotten about FCA’s diesel emissions drama, which first came to light about two years ago: U.S. federal regulators alleged that the automaker was violating the Clean Air Act by running software that skirted emissions testing rules in some 3.0-liter EcoDiesel powered Jeep Grand Cherokees and Ram 1500s made between 2014 and 2016.
From our own David Tracy’s 2017 writeup on the case:
FCA’s suit appears to differ from VW’s scandal in that VW’s defeat device actually sensed when the vehicle was being tested by the government on a dyno, and turned up emissions controls accordingly. FCA, on the other hand, appears to have optimized its emissions controls software to the EPA’s drive cycles too narrowly, and not focused on keeping emissions down in off-cycle, normal on-road conditions.
As it stands, FCA has not admitted any wrongdoing. As the AP reported: “The company has said its software met all legal requirements and it didn’t intend to break the law.” FCA did not immediately reply to my email for comment.
“Today’s settlement does not resolve any potential criminal liability.” The Jan. 10 DOJ statement reads. “The settlement also does not resolve any consumer claims or claims by individual owners or lessees who may have asserted claims in the ongoing multidistrict litigation.” The state of California is still also pursuing its own settlement with FCA.
The initial lawsuit from the DOJ was looking for $4 billion, compared to that figure FCA got off easy. the settlement will supposedly be announced officially by the U.S. Justice Department and Environmental Protection Agency on Thursday.