Hyundai and Kia have agreed to pay a total of $100 million to settle an investigation into its misstatement of gas mileage estimates on about 1.2 million vehicles, the government announced.
The civil penalty is the largest ever under the Clean Air Act, according to the federal Environmental Protection Agency and the Justice Department.
The brands also will give up greenhouse gas emissions credits — estimated by the EPA as worth $200 million — because of the lower mileage ratings added up to 4.75 million more metric tons of greenhouse gases. They also agreed to spend $50 million on an independent unit to set their future mileage estimates.
The fines and penalties resolve a lawsuit filed against the automakers in US District Court in Washington, D.C., by the United States and the California Air Resources Board.
“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 in a statement.
The EPA said Hyundai and Kia chose favorable results rather than average results from a large number of tests, and the violations were discovered in EPA vehicle testing.
“This type of conduct quite simply will not be tolerated. And the Justice Department will never rest or waver in our determination to take action against any company that engages in such activities — whenever and wherever they are uncovered,” US Attorney General Eric Holder said in a statement.
Hyundai will pay $56.8 million of the civil penalty, Kia the rest.
Because of the improper testing procedures, the brands were forced in 2012 to lower mileage estimates by 1 to 6 miles per gallon for a raft of model year 2011 through 2013 Hyundai and Kia vehicles, including the Hyundai Accent, Elantra, Veloster and Santa Fe and the Kia Rio and Soul.
The brands then created a compensation program for customers to repay them for their lower mileage. They also a year ago settled a series of lawsuits over the restatement for about $400 million.
“Hyundai has acted transparently, reimbursed affected customers and fully cooperated with the EPA throughout the course of its investigation,” said David Zuchowski, CEO of Hyundai Motor America. “We are pleased to put this behind us, and gratified that even with our adjusted fuel economy ratings, Hyundai continues to lead the automotive industry in fuel efficiency and environmental performance.”
Since the Hyundai restatement, several other automakers — including Ford, Mini and Mercedes-Benz — also have had to restate their mileage estimates on certain models.
