Hyundai Fined Millions for Overstating Mileage and Understating Emissions

Hyundai Motor Co. and Kia Motors Corp. will pay $100 million — the largest penalty ever levied under the Clean Air Act — to settle claims they sold more than 1 million vehicles that emit much greater quantities of greenhouse gases than what they had certified to the U.S. Environmental Protection Agency, the U.S. Department of Justice said Monday.
According to a complaint filed by the federal government and the California Air Resources Board, Hyundai and Kia misrepresented their vehicles’ greenhouse gas emissions and fuel economy by installing special equipment on test cars and submitting the most favorable test results to the government. Under the settlement, the companies denied the charges but will pay the DOJ about $93.6 million and the CARB about $6.4 million. Automakers have been required to meet new standards after the EPA and National Highway Traffic Safety Administration in 2010 established emissions and fuel economy standards for passenger cars, light-duty trucks and medium-duty passenger vehicles for model years 2012 through 2016.

The governments also alleged Hyundai and Kia overstated their vehicles’ fuel economy by one to six miles per gallon. The companies also allegedly understated the emissions of greenhouse gases by their fleets by approximately 4.75 million metric tons over the estimated lifetime of the vehicles.

The complaint said the companies brought their vehicles to the market with a design specification that relates to emissions, called road load force, that did not conform to specifications included in their applications for certificates of conformity. Those certificates cover vehicles that conform “in all material respects” to the design specifications stated in the application.

Road load force is a measure of the internal and external forces that cause a vehicle to lose speed, such as driveline friction and wind resistance, the complaint said, and is a critical factor in the testing and analysis the manufacturer conducts to derive fuel economy rates and to demonstrate that vehicles meet air pollution emission standards.

A vehicle with a low road load force has relatively higher fuel economy and emits lower amounts of greenhouse gases because the vehicle efficiently maintains its momentum, while a vehicle with a higher road load force has lower fuel economy and emits more greenhouse gases because it needs to burn more fuel to counteract that road load force and maintain speed.