Hyundai And Kia's Engine Problem Costing $210 Million

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An agreement has finally been reached.

This all began three years ago when certain model years of the Hyundai Sonata and Santa Fe were recalled over serious engine issues. Certain Kia models were later added to the list. The problem involved machining errors during the manufacturing process that could cause "premature bearing wear within the engine," according to the National Highway Traffic Safety Administration (NHTSA). The affected vehicles were from 2011-2014 for the Sonata and Kia Optima, 2013-2014 Santa Fe, 2012-2014 Sorento, and 2013-2013 Sportage.

All told, 1.5 million vehicles were recalled in the US, Canada, and South Korea. A total of 1.19 million vehicles were affected in the US alone. Unfortunately for the South Korean brands, they didn't issue this recall in a timely manner, though it has now been concluded. However, this delay has resulted in a combined $210 million cash penalty.

2011-2014 Hyundai Sonata Sedan Three Quarter Front Left Side View Hyundai
2011-2014 Hyundai Sonata Sedan Left Side View In Motion Hyundai
2011-2014 Hyundai Sonata Sedan Open Hood Hyundai

The NHTSA has confirmed the automakers have agreed to consent orders after they inaccurately reported some pieces of information regarding the recalls. The result is a total civil penalty of $140 million from Hyundai, including an upfront payment of $54 million, and to make investments of $40 million to improve its safety operations. In addition, Hyundai will make a $46 million deferred penalty if it fails to meet requirements.

Kia's civil penalty comes to $70 million, including an upfront payment of $27 million. It will also have to spend $16 million on several new safety measures and a possible $27 million deferred penalty.

2013-2016 Hyundai Santa Fe Three Quarter Front Left View Hyundai
2011-2016 Kia Sportage Three Quarter Front Left Side View Kia
2014-2015 Kia Sorento Right Side View Kia
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"Customer safety is our highest priority and we are taking immediate action to enhance our response to potential safety concerns," said Brian Latouf, chief safety officer, Hyundai Motor North America. "We value a collaborative and cooperative relationship with the U.S. Department of Transportation and NHTSA, and will continue to work closely with the agency to proactively identify and address potential safety issues. We are committed to a best in class U.S. safety office."

As for the recall itself, Hyundai and Kia had to replace those vehicles' engines free of charge to owners.

2014-2015 Kia Optima Sedan Three Quarter Front Left Side View Kia
2014-2015 Kia Optima Sedan Three Quarter Front Left Side View Kia

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2013-2016 Hyundai Santa Fe Three Quarter Front Left View
2011-2014 Hyundai Sonata Sedan Open Hood
2011-2014 Hyundai Sonata Sedan Three Quarter Front Left Side View
2011-2014 Hyundai Sonata Sedan Left Side View In Motion
2014-2015 Kia Optima Sedan Three Quarter Front Left Side View
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