In a settlement announced Thursday by California officials, Fiat Chrysler Automobiles agreed to pay $500 million over charges that the global carmaker used "defeat device software" in thousands of diesel cars to cheat on air pollution tests. Apart from this, part of the settlement includes US$ 311 million in fines and US$ 72 million to other states.
The recall and federal mitigation programs are estimated to cost up to $185 (£145 / €160) million, while FCA will fork over another $19 (£14.9 / €16.5) million to mitigate excess emissions from vehicles in California.
The automaker will recall approximately 100,000 vehicles including model year 2014-2016 Jeep Grand Cherokees and Ram pickup trucks for the software update. Owners of such vehicles could get up to US$ 2,800 each.
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The case, announced by the state Department of Justice and the California Air Resources Board, is similar to the multibillion-dollar settlement made by Volkswagen over the use of the rogue software.
Fiat Chrysler will not admit wrongdoing as part of the civil settlement.
The settlement resolves allegations that FCA used illegal software to get about 100,000 diesel trucks past laboratory emissions inspections and onto USA roads. The company also agreed to buy back some vehicles, fix others, pay to mitigate environmental harm and settle lawsuits for a cost of more than $30 billion. It will mark a milestone in the second major case brought by American officials against an automaker for Clean Air Act violations stemming from diesel vehicles equipped with pollution controls prohibited by USA law. USA officials refrained from accusing the auto manufacturer of intentionally creating software to cheat on emissions tests.
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"Fiat Chrysler broke those laws and this case demonstrates that steep penalties await corporations that engage in such egregious violations", Principal Deputy Associate Attorney General Jesse Panuccio told a news conference.
Representatives for Fiat Chrysler and the Justice Department declined to comment.
The Justice Department said the settlement does not resolve an ongoing criminal investigation into Fiat Chrysler's conduct. "Today's settlement sends a clear and strong signal to manufacturers and consumers alike - the Trump administration will vigorously enforce the nation's laws created to protect the environment and public health".
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