Feds Force Automaker To Settle For Dirty Diesels

Jan. 13, 2019 10:30 AM ET by Jay Traugott / Comments

Who else aside from VW was in trouble?

It all began in September 2015 when Volkswagen admitted it purposely installed so-called "defeat devices" in millions of its diesel-powered passenger cars in order to meet regulatory fuel emission standards. A total of 11 million globally were affected, 500,000 of them in the US. But VW was not the only major automaker to be suspected of committing a similar act.

Fiat Chrysler was also alleged by the US Justice Department of using illegal software in 104,000 of its US diesel vehicles to pollute beyond what was allowed. The automaker tried to deny the claims but according to Reuters, it appears it will instead settle both criminal and civil claims with the government following a two-year investigation.

FCA must have known something like this was coming because last October it set aside $810 million for all diesel-related expenses. It's expected the civil litigation will be resolved this week while the criminal settlement could be announced later this month, but details of both resolutions are being kept secret for now. However, an anonymous source told Bloomberg FCA would be required to admit wrongdoing. It's also unknown whether the Justice Department will pursue criminal charges against FCA individuals, like it did with eight Volkswagen officials, including ex-CEO Martin Winterkorn.

FCA troubles began exactly two years ago when the EPA and California Air Resources Board (CARB) alleged FCA sold 104,000 diesel-powered SUVs and pickup trucks that violated US environmental law. More specifically, regulators claimed the 3.0-liter V6 diesel, found in vehicles such as the Ram 1500 and Jeep Grand Cherokee, came equipped with pollution-control software that purposely violated emissions laws. A few months later, the Justice Department sued FCA for violating the Clean Air Act.

We'll likely learn more information in the coming days, but even if FCA has to fork over some $810 million, give or take, it'll still be getting off easy. VW had to pay $30 billion in fines, settlements, and other related costs after it plead guilty in late 2017 for its misgivings.

Feds Force Automaker To Settle For Dirty Diesels

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