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Hyundai And Kia Penalized $350 Million For Overstated MPG Claims

Nearly two years after Hyundai and Kia announced they exaggerated fuel economy numbers for several of their most popular models, the two Korean automakers have paid a heavy penalty for the transgressions. The Department of Justice and Environmental Protection Agency announced a settlement Monday that will cost the two car companies approximately $350 million. The financial sum includes a $100 million fine, the largest ever levied under the Clean Air Act, and about $200 million in forfeited greenhouse-gas emissions credits. At a time when car buyers rank fuel economy as a top concern when they head to dealerships and the federal government has mandated increased efficiency, Attorney General Eric Holder said the settlement should serve as a warning to automakers not to fudge their numbers. "This will send a strong message that cheating is not profitable," he said. The settlement ends a federal lawsuit filed against the automakers in U.S. District Court, but it's important to note that it doesn't end a class-action lawsuit filed on behalf of consumers. A preliminary settlement in that case, based in Los Angeles, was approved last month, but final approval isn't expected until July 2015. Officials with the EPA said the $100 million figure roughly equals the economic benefits the two companies received from exaggerating the mileage claims on the window stickers of new cars. Fuel-efficient boasts helped Hyundai and Kia establish a strong foothold in the U.S. marketplace. Advertisements for the Hyundai Elantra stated the vehicle achieved 40 miles per gallon in highway driving, and helped the car win the prestigious North American Car Of The Year honors at the Detroit Auto Show for its 2012 model. In July 2011, the advocacy group Consumer Watchdog began receiving complaints from consumers that the Elantra and other Hyundai models fell short of their stated mileage claims in real-world driving. The group wrote to the EPA and Hyundai, asking both to investigate. Government officials said Kia had overstated the mileage on its popular Kia Soul crossover by 6 miles per gallon, and more than a dozen overall models were affected. On Monday, EPA administrator Gina McCarthy said the violations were "egregious." Based on the exaggerations, the EPA calculated that Hyundai and Kia had underreported the greenhouse gas emissions of their fleets by about 4.75 metric tons over the estimated lifetime of the vehicles. That figure aided in the $200 million credit forfeiture.

Hyundai Tucson Fuel Cell CUV deliveries running behind schedule

Things are running a little bit behind on Hyundai's hydrogen-powered Tucson Fuel Cell CUV program in the US. The last time we checked in with the South Korean automaker's H2 project, we heard that the first deliveries were supposed to happen by the end of March. Speaking with Hyundai's Kevin Lee at the Hyundai booth at the SAE World Congress this week, we learned that deliveries are now going to happen closer to a month from now. Globally, there are roughly 70-100 of these hydrogen CUVs running in customer hands today. Lee told AutoblogGreen that the first US-bound units will be shipped from South Korea at the end of April or beginning of May but there is no actual date set for the first customer delivery. He said he expects 100 or fewer H2 powered Tucson CUVs to be operating in the US by the end of this year, all of them in Southern California. He said the customers in this first batch are being selected based on the location of the nearest hydrogen fuel station. While the number of stations is small today, more are on the way. Globally, there are roughly 70-100 of these hydrogen-powered CUVs (also known as the ix35) running in customer hands today, in places like South Korea, Germany, Norway, Austria and Italy. Some H2 stations charge Hyundai a flat rate per fill while others charge the automaker a general station maintenance fee. In the US, the Tucson Fuel Cell CUV leases for $499 a month (with $2,999 down) for 36 months, and comes with unlimited hydrogen refueling as well as Hyundai's Valet Maintenance. Lee told us that one reason for the "free" hydrogen is that even the small number of public hydrogen stations out there (nine in SoCal) does not have a cohesive set of rules for how to sell H2 to the public. The stations are not yet certified to charge customers based on dollar per kilogram in California, Lee said, since that regulation has not yet been set by the Division of Measurement Standards (DMS). Currently, "each station is different," he said, with some charging Hyundai a flat rate per fill and others charging the automaker a general station maintenance fee. This situation will likely change by the end of the year, he said. Lee said Hyundai is already busy working on the next-gen fuel cell vehicles and trying to reduce costs but was not able to share any details.

Kia recalls 507,000 vehicles in U.S. for airbag issues

WASHINGTON — Kia Motors Corp said on Friday it was recalling more than 507,000 vehicles in the United States because an electronic glitch may prevent airbags from deploying in a crash. The recall follows an announcement in March by the National Highway Traffic Safety Administration (NHTSA) that it was investigating why some airbags had failed to deploy in Kia vehicles and its affiliate Hyundai after crashes in which four people were killed and another six were injured. The two Korean automakers have now recalled nearly 1.1 million U.S. vehicles to address the issue. NHTSA said in March that it was aware of six serious crashes in which airbags failed to deploy in frontal crashes, including four in 2011 model Hyundai Sonatas and two in 2012 and 2013 Kia Forte vehicles. The crash of the 2013 Forte occurred in Canada. Kia's recall issued on Friday covers 2010-2013 Kia Fortes, 2011-2013 Kia Optimas and 2011-2012 Kia Optima Hybrid and Sedona vehicles. The company said the airbag control unit may short circuit because they may be susceptible to electrical overstress, preventing the frontal airbags and seat belt pretensioners, which pull the driver and front seat passenger firmly back into their seats, from deploying. The company said it does not yet have a fix, but is working with its supplier on the issue. Kia spokesman James Bell said the company "is attempting to have a remedy by the scheduled owner notification date of July 27. If Kia does not have a remedy by that date or if any customer feels unsafe in his/her vehicle, we will provide a rental car until the repair has been completed." Hyundai in February issued a recall for 154,000 U.S. Sonatas after non-deployment reports were linked to electrical overstress in the air bag control unit. In April, Hyundai recalled an additional 425,000 U.S. vehicles to address the same issue. Hyundai said in March that it was aware of reports of two deaths in its vehicles, which occurred in head-on collisions at extremely high rates of speed. NHTSA said the airbag control module under investigation was built by ZF Friedrichshafen AG, a German auto supplier. ZF said on Friday that it has worked with Kia and "continues to cooperate and support NHTSA and its customers in the investigation." The safety agency also said that electrical overstress appeared to be the root cause in a 2016 recall by Fiat Chrysler Automobiles NV of 1.4 million U.S. vehicles for airbag non-deployments in significant frontal crashes.