Fiat Chrysler Automobiles (FCA) will pay out roughly US$800 million ($1.1 billion) in fines, fixes and compensation to settle claims some of its diesel engines cheated their way past emissions regulations. Apart from this, part of the settlement includes US$ 311 million in fines and US$ 72 million to other states.
The multinational auto manufacturer will pay $305 million to the state of California and the federal government, recall around 104,000 vehicles, pay vehicle owners an average of $2,500 in compensation, and pay approximately $78 million in litigation and other penalties.
The automaker will recall approximately 100,000 vehicles including model year 2014-2016 Jeep Grand Cherokeesand Ram pickup trucks for the software update.
Fiat Chrysler will agree to corporate governance reforms meant to prevent future emissions violations under the agreement, the person said. Owners of such vehicles could get up to US$ 2,800 each.
The Justice Department said Fiat Chrysler must work with one or more vendors of aftermarket catalytic converters to improve the efficiency of 200,000 converters that will be sold in the 47 USA states that do not already require the use of the California-mandated high-efficiency gasoline vehicle catalysts.
The government accused FCA of putting eight "software-based features" on 3.0-litre V6 engines that powered the Jeep and Ram vehicles.
The settlement marks the conclusion of a lawsuit first brought on by the Justice Department in 2017.
Fiat-Chrysler and the Department of Justice each declined to comment when reached by ABC News.
The Justice Department also opened a criminal investigation into Fiat Chrysler's conduct, and several state attorneys general also were investigating.
"Fiat Chrysler deceived consumers and the federal government by installing (hidden software) on these vehicles that undermined important clean air protections", said Andrew Wheeler, acting administrator of the U.S. Environmental Protection Agency. "Today's settlement sends a clear and strong signal to manufacturers and consumers that EPA will vigorously enforce the nation's laws created to protect the environment and public health".
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