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It’s official: US suing FCA

by David Zatz on

The United States Department of Justice (DOJ) has filed a lawsuit [full text] against Fiat Chrysler Automobiles, accusing the company of bypassing emission controls through software. At issue are diesel engines, made by FCA subsidiary VM, used in the Ram 1500 and Jeep Grand Cherokee; Cummins-powered Rams were quickly cleared of any emissions issues.

FCA has denied culpability [full text], and “intends to defend itself vigorously” against any accusations that it intended to cheat emissions tests.

FCA has also asked the EPA to certify a software update for retrofitting 2014-16 Rams and Jeeps, and for programming the 2017s. FCA and the EPA have been working together on a solution since the issue was first discovered.

According to the DOJ lawsuit, FCA used software to shut off emissions systems under certain conditions, so the trucks produced  nitrogen oxide (NOx) far in excess of the legal limit, causing smog and respiratory problems. These shutoffs were supposed to be disclosed to the EPA in the certification application, but were not, which FCA claimed was merely due to errors on their part.

Civil penalties, according to an EPA statement, could peak at $4.6 billion, but are likely to be far lower, especially since only 104,000 of the vehicles were sold in the US, and only in the 2014-16 model years.

The discovery, led by independent groups, that Volkswagen had deliberately bypassed testing, coupled with independent on-the-road tests of other diesel-powered vehicles, led the United States to recertify diesel engines from all automakers. Ram’s Cummins engines were quickly cleared.

Yesterday, German prosecutors searched Daimler’s offices for diesel cheating evidence; there will be no 2017 Mercedes diesel cars sold in the US.

There are several possible reasons for the timing of the lawsuit:

  • It might have been approved shortly before FCA’s recent  recertification plan, to pressure FCA into a faster update.
  • FCA may have finalized its recertification plan when it heard  rumors of the pending lawsuit.
  • The DOJ may have taken action based on the contents of Italian-language emails involving VM, as indicated by a recent Reuters article. VM was only half-owned by FCA when the diesels were tuned for Ram and Jeep. FCA has been cooperating by preserving information and putting an “investigation hold” on 190 people.

Regardless, a settlement for far less than the maximum penalty is extremely likely; and the final settlement may not involve money at all, or may include a token fine.

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