Fiat Chrysler to pay hundreds of millions to settle emissions charges in the US

Posted at 2:31 AM, Jan 10, 2019
and last updated 2019-01-10 02:31:47-05

Fiat Chrysler will pay hundreds of millions of dollars in fines and civil penalties to settle charges that its diesel vehicles sold in the United States violated emissions rules.

The settlement is due to be announced Thursday morning, according to a person familiar with the details. He told CNN the total sum will be in the neighborhood of the roughly $800 million that Fiat Chrysler (FCAU) previously said it had set aside to settle the case.The deal does not include any admission of guilt or wrongdoing by the automaker.

The fines will come to about $305 million, according to the source, to be split among the US Justice Department, the Environmental Protection Agency and the California Air Resources Board. Most of the rest of the money will be in the form of civil settlements, to both car and truck owners and to various state attorneys general who brought their own actions against the automaker.

The company will make payments of up to $2,800 per vehicle to the owners of 100,000 diesel-powered Jeep SUVs and Ram pickup.

The vehicles involved are the 2014, 2015 and 2016 model year Jeep Grand Cherokees SUVs and Dodge Ram 1500 trucks with 3-liter diesel engines.Fiat Chrysler's settlement is just a fraction of the $14.7 billion deal reached between US authorities and Volkswagen (VLKAF) in 2016, which covered cheating software on nearly a half-million diesel cars sold in the country.

Volkswagen admitted that its software was improperly installed to deceive emission-testing equipment by making engines put out much lower levels of the pollutants when being tested than they did in real-world driving situations.

But Fiat Chrylser has always maintained that it did nothing wrong and that the software for its diesel car engines is a legitimate way to meet emissions rules. The company said the software is there to protect the engine from damage during testing rather than to cheat on emissions tests.

The settlement comes almost exactly two years since regulators first accused Fiat Chrysler of cheating on the tests. The announcement was made during the final days of the Obama administration.

The Trump administration has taken a much more industry-friendly view of environmental regulations. For example, it has taken steps to roll back Obama-era emissions rules that would require far greater fuel efficiency from future model years of US vehicles. But it did not drop the case against Fiat Chrysler.