Fiat Chrysler to pay $515 mn in United States 'dieselgate' settlements

Ram trucks are seen on a sales lot

Ram trucks are seen on a sales lot

Fiat Chrysler will pay more than $650 million to settle allegations of cheating on emissions tests.

Under a deal with the Justice Department and the Environmental Protection Agency, the automaker will recall and fix the more than 104,000 out-of-compliance Jeep SUVs and Ram pickup trucks. Current and former owners and lessees are also eligible to receive a payment averaging $2,800. Apart from this, part of the settlement includes US$ 311 million in fines and US$ 72 million to other states. For example, someone who owned an affected vehicle on January 12, 2017, and who completes the software update will receive $3,075, according to the Plaintiffs' Committee for Fiat Chrysler-Dodge-Jeep EcoDiesel Litigation.

The settlement, which is expected to be formally announced Thursday by the U.S. Justice Department and the Environmental Protection Agency, is the second between the U.S. government and an automaker over diesel emissions-cheating allegations.

Fiat Chrysler won't admit wrongdoing in the settlement.

In 2016, Volkswagen pleaded guilty to criminal charges and agreed to pay a $2.8 billion penalty to settle government lawsuits.

Fiat Chrysler shares were up 1.2 percent at $15.96 in NY near midday on Thursday.

The settlement is the second between the US government and an automaker over allegations of cheating on diesel emissions.

Volkswagen AG in January 2017 pleaded guilty to criminal charges and agreed to pay some $4.3 billion in US penalties for its scheme to deliberately rig hundreds of thousands of USA diesel vehicles to cheat on emissions tests.

FCA said that the total cost of owner compensation, extended warranties, and environmental mitigation is estimated at $400 million. VW was found to have colluded with Bosch to pass US emissions only while its vehicles sensed they were being tested by federal agencies, while otherwise they operated in a completely different driving mode that polluted up to 40 times above the legal limit. FCA failed to disclose the software during the process to become certified so the vehicles can be sold, according to the EPA.

At issue is what CARB calls "auxiliary emission-control devices" (in other words, software code) that can allow excess pollution at specific times, such as during a cold start or for dumping fuel to clean the particulate filter, that must be disclosed.

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