Fiat Chrysler settles with US over diesel emissions cheating

It could pay upward of $800 million, even though it's not admitting guilt.

Updated ·2 min read

Fiat Chrysler is about to pay a stiff penalty for its alleged diesel vehicle emissions cheating. The automaker has reached a settlement with the Justice Department, EPA and California that will see it make amends for claimed violations of the country's Clean Air Act. It's launching a recall to fix the more than 100,000 diesel vehicles believed to be exceeding pollution limits. More importantly, there's a hefty financial punishment. Fiat Chrysler will pay as much as $800 million to address the case, including a combined $311 million in civil penalties, up to $280 million to address claims from owners (who get an average of $2,800 each) and $100 million for post-fix extended warranties.

The company won't have to admit wrongdoing, and it insists that it didn't do anything deliberate to violate emissions rules. However, the DOJ stressed that this doesn't avoid potential criminal liability or settle any individual claims. Fiat Chrysler could be on the hook for more payouts if those other cases are successful.

In the allegations, government officials said that 2014-2016 diesel versions of Jeep Grand Cherokees and Dodge Ram 1500 trucks included "illegal and undisclosed" software that made the emissions control system behave one way during government tests, and another way when on the road. Similar to the claims leveled against VW, they amounted to "defeat devices" in the DOJ's eyes.

The settlement theoretically keeps Fiat Chrysler on the straight and narrow. To some degree, though, it's another nail in diesel's coffin. Many car brands are already shying away from diesel in the wake of emissions scandals and sinking demand, opting instead to shift their focus to hybrids and pure electric vehicles. There might not be as much demand for diesel going forward, at least outside of professional circles.