Hyundai and Kia to pay record EPA fine
11-03-14, 08:51 AM
#1
Lexus Fanatic
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Hyundai and Kia to pay record EPA fine
ouch...
Hyundai and Kia to pay record EPA fine
NEW YORK (CNNMoney) Hyundai and Kia will pay a record $100 million penalty for overstating fuel economy estimates for many of their vehicles.
The South Korean automakers had already agreed to pay consumers for the difference in estimated fuel costs, when the discrepancy was discovered by the Environmental Protection Agency in 2012.
The civil fine and other penalties announced Monday are in addition to those direct payments to vehicle owners.
The vehicles involved were the Hyundai Accent, Elantra, Veloster and Santa Fe and the Kia Rio and Soul.
The automakers overstated fuel economy figures for their vehicles by an average of six miles per gallon, the EPA said.
The fuel economy figures shown on automobile window stickers are based on testing done by the automakers themselves. The EPA then tests about 15% of all models itself to ensure automakers are reporting accurate results.
http://money.cnn.com/2014/11/03/auto...-kia-epa-fine/
Hyundai and Kia to pay record EPA fine
NEW YORK (CNNMoney) Hyundai and Kia will pay a record $100 million penalty for overstating fuel economy estimates for many of their vehicles.
The South Korean automakers had already agreed to pay consumers for the difference in estimated fuel costs, when the discrepancy was discovered by the Environmental Protection Agency in 2012.
The civil fine and other penalties announced Monday are in addition to those direct payments to vehicle owners.
The vehicles involved were the Hyundai Accent, Elantra, Veloster and Santa Fe and the Kia Rio and Soul.
The automakers overstated fuel economy figures for their vehicles by an average of six miles per gallon, the EPA said.
The fuel economy figures shown on automobile window stickers are based on testing done by the automakers themselves. The EPA then tests about 15% of all models itself to ensure automakers are reporting accurate results.
http://money.cnn.com/2014/11/03/auto...-kia-epa-fine/
11-03-14, 09:45 AM
#2
There's more than that... Close to $350 million in total liabilities
Hyundai and Kia will pay a $100 million civil penalty, spend $50 million to establish an independent fuel economy certification group and forfeit some 4.75 million greenhouse gas emission credits the companies have banked under the EPA’s tailpipe emissions regulations -- estimated to be worth more than $200 million, according to a joint statement by the Justice Department and EPA.
11-03-14, 11:21 AM
#6
Quoted for truth. The EPA will point the finger back saying they don't have the funding/manpower to test all vehicles, etc. Just a vicious cycle of pointing fingers around all of this.
EPA needs to make a more discrete, non-loophole, testing procedure that reflects current real world driving conditions that the can automakers follow.
EPA needs to make a more discrete, non-loophole, testing procedure that reflects current real world driving conditions that the can automakers follow.
11-03-14, 11:40 AM
#7
Lexus Fanatic
IMO, this is bull****. I'm with the auto companies on this one. The government should not be dictating gas-mileage standards in the first place. The EPA got into the habit of doing so back in the 1970s, and the courts, unfortunately, have not stepped in to prevent it.
And, IMO, this is even worse.......giving some of the fine-money to an organization like CARB. They are one of the main reasons why gas is so expensive in California....though, admittedly, prices of late have dropped.
The California Air Resources Board was also involved in the settlement and will receive a portion of the civil penalty paid by the automakers.
Last edited by mmarshall; 11-03-14 at 11:45 AM.
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11-03-14, 11:57 AM
#8
Lexus Champion
IMO, this is bull****. I'm with the auto companies on this one. The government should not be dictating gas-mileage standards in the first place. The EPA got into the habit of doing so back in the 1970s, and the courts, unfortunately, have not stepped in to prevent it.
And, IMO, this is even worse.......giving some of the fine-money to an organization like CARB. They are one of the main reasons why gas is so expensive in California....though, admittedly, prices of late have dropped.
And, IMO, this is even worse.......giving some of the fine-money to an organization like CARB. They are one of the main reasons why gas is so expensive in California....though, admittedly, prices of late have dropped.
This fine is not about not meeting gas-mileage standards but lying about the fuel consumption of Hyundai and Kia cars for comparison purposes.
Auto manufacturers test and measure the fuel consumption of their cars, following the EPA guidelines to do so. Doing so and honestly reporting honest numbers allows buyers to compare the fuel consumption of cars they are interested in. Hyundai/Kia cheated and did not properly follow the EPA guidelines, reporting fuel consumption figures that were too high, making them look better than they are, artificially giving them an advantage.
Cheaters should be punished.
The fact that the EPA only audits 15% of the results submitted to it is beside the point. Hyundai/Kia cheated and were caught cheating. They are now paying the price for cheating.
11-03-14, 12:15 PM
#9
Lexus Fanatic
Auto manufacturers test and measure the fuel consumption of their cars, following the EPA guidelines to do so. Doing so and honestly reporting honest numbers allows buyers to compare the fuel consumption of cars they are interested in. Hyundai/Kia cheated and did not properly follow the EPA guidelines, reporting fuel consumption figures that were too high, making them look better than they are, artificially giving them an advantage.
The fact that the EPA only audits 15% of the results submitted to it is beside the point. Hyundai/Kia cheated and were caught cheating. They are now paying the price for cheating.
11-03-14, 07:29 PM
#12
Lexus Champion
In effect, that's still not meeting standards......comparison or not, what the EPA thinks the standards should be. I just don't feel that gas mileage is something that the government should be regulating....they dictate large parts of new-vehicle design as it is now, often forcing more and more equipment on new cars that just adds to the price.
I disagree that it gives them an advantage. Most new car buyers, even those who are not particularly car-saavy like us, are not idiots.....they know that real-world mileage can be the same, worse, or even better than the EPA figure. I know I often do better on the highway than the official EPA figure, as I don't cruise at really high speeds. But, conversely, I find it difficult to get the official EPA figure in stop-and-go driving, where I usually do worse.
No...YOU, as a new-car buyer, will actually pay that price the next time you go to buy a new Hyundai or Kia product. Money doesn't grow on trees,.........their list-prices will have to go up to recover the amount spent on the fines. In fact, Hyundai and Kia prices have already gone up significantly in the last several years to reflect their now-better build-quality and materials....now they will be up even more.
I disagree that it gives them an advantage. Most new car buyers, even those who are not particularly car-saavy like us, are not idiots.....they know that real-world mileage can be the same, worse, or even better than the EPA figure. I know I often do better on the highway than the official EPA figure, as I don't cruise at really high speeds. But, conversely, I find it difficult to get the official EPA figure in stop-and-go driving, where I usually do worse.
No...YOU, as a new-car buyer, will actually pay that price the next time you go to buy a new Hyundai or Kia product. Money doesn't grow on trees,.........their list-prices will have to go up to recover the amount spent on the fines. In fact, Hyundai and Kia prices have already gone up significantly in the last several years to reflect their now-better build-quality and materials....now they will be up even more.
You don't seem to understand, Mike. Call it what you will -- "standards" if you wish -- but these EPA fuel consumption (mileage) ratings are meant to allow prospective buyers to compare the fuel consumption between any similarly-sized vehicles. It does not matter that "your results may vary". The fact that all manufacturers test their cars in the same known, repeatable, scientific method allows buyers to compare any two cars of the same size classification; it gives the shopper one extra, important "feature" to consider when shopping.
Hyundai/Kia (and Ford) were caught cheating, reporting higher mileage than they would if they had followed the rules properly. By cheating, they gave buyers the impression that their cars use (much) less fuel than competitors' cars, when that may not have been true. By cheating, they tried to give themselves an advantage. Because they cheated, the figures they got could not be compared with other manufacturers' cars because the way they measured was different.
If you are comparing the fuel consumption of 2 cars and both cars were tested in the same way, it is an apples-to-apples comparison, but if the 2 cars used different test methods, it is an apples-to-oranges comparison -- an unfair comparison.
Yes, I agree that by imposing a large fine on the manufacturer, the manufacturer (Hyundai/Kia) may pass on that cost to buyers as increased prices, but suddenly increased prices are likely to turn buyers away from Hyundai and Kia showrooms so, in the end, it is Hyundai and Kia that suffer. There are many other choices out there and if a shopper walks out of the Hyundai showroom because of high prices, they can walk down the street to the Honda or Toyota dealership.
11-03-14, 07:39 PM
#13
Lexus Champion
No. EPA publishes the testing method and then allows each manufacturer to test their own cars, following that method. The EPA then checks the results by testing some of the cars itself (and comparing the EPA's result with the manufacturer's result) -- but not all cars because they do not have the resources (money and time) to test each and every new car every year.
All manufacturers are supposed to follow the same method but Hyundai/Kia (and Ford) were caught cheating (not following the test method exactly as they should have).
If manufacturers follow the same testing method, their results can be compared with similarly-sized cars from other manufacturers; but if one cheats, the fuel consumption figures they publish are up in the air. You cannot compare 2 cars that used different testing methods: For example, say one manufacturer tested downhill with a tailwind while the other tested uphill with a headwind, obviously, one will get better results than the other, and you cannot compare the 2 cars.
If you are caught cheating, you should be punished.
11-03-14, 08:27 PM
#14
I can't believe there are people defending Hyundai/Kia in this. How many people were duped by all those ads with 40 MPG in big bold letters? That was the cornerstone of Hyundai's marketing for at least a few years. Although they have offered compensation for gas, that is a pittance compared to the tens of thousands of dollars people paid for their cars. Hyundai came off the winner in this exchange and have highly profited from their increased sales, with their consumers being the losers , believing they were were getting more than what they actually get.
11-04-14, 05:00 AM
#15
Quoted for truth. The EPA will point the finger back saying they don't have the funding/manpower to test all vehicles, etc. Just a vicious cycle of pointing fingers around all of this.
EPA needs to make a more discrete, non-loophole, testing procedure that reflects current real world driving conditions that the can automakers follow.
EPA needs to make a more discrete, non-loophole, testing procedure that reflects current real world driving conditions that the can automakers follow.
Thus they are fined now.
I remember the threads when their 40+ MPG cars came out, they were advertised heavily against Toyota vehicles and we had a lot of threads here about Toyota being doomed and using inferior technology.
In the end, smoke and mirrors and had to restate their MPGs to true values, and they are being punished by the market and government. I see that Hyundai's sales are down again, and so are Fords. Ford sales of some vehicles were heavily hit when MPG was restated.