In what the U.S. Environmental Protection Agency (EPA) called "an historic settlement," automakers Hyundai and Kia agreed to pay $100 million to resolve alleged Clean Air Act violations involving close to 1.2 million vehicles from model years 2012 and 2013 that will emit about 4.75 million metric tons of greenhouse gases in excess of what the companies certified to the EPA.
In addition to the $100 million civil penalty, the largest in Clean Air Act history, the automakers will spend approximately $50 million on measures to prevent any future violations. The companies will also forfeit 4.75 million greenhouse gas emission credits that the companies previously claimed, which are estimated to be worth more than $200 million.
Greenhouse gas emission credits can be used to offset emissions from less fuel-efficient vehicle models and can be sold or traded to other automakers for the same purpose. The forfeited credits are equal to emissions from powering more than 433,000 homes for a year.
"Businesses that play by the rules shouldn't have to compete with those breaking the law," said EPA Administrator Gina McCarthy. "This settlement upholds the integrity of the nation's fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact."
This case involves five different entities, including Hyundai Motor Company, Hyundai Motor America, Kia Motors Corporation, Kia Motors America and Hyundai American Technical Center, Inc. The California Air Resources Board joined the United States as a co-plaintiff in this settlement and will receive $6,343,400 of the $100 million civil penalty. The proposed consent decree is subject to a 30-day public comment period and court review and approval.