EPA Alleges FCA For Emissions Cheating

Jan 13, 2017 06:30 AM EST | Jeroah Sabado

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On Thursday, the United States Environmental Protection Agency (EPA) accused Fiat Chrysler Automobiles NV of illegally installing hidden software in some diesel engine vehicles. The software is used to allow excess diesel emissions to go undetected, resulting in increased levels of nitrogen oxides.

In a statement published on the agency's official website, EPA says that FCA had this software equipped to roughly 104,000 vehicles, including the recent Dodge Ram 1500 trucks with 3.0-liter diesel engine, and 2014, 2015 and 2016 Jeep sport-utility vehicles. The automaker's shares dropped 12% in the most recent trading after the accusation.

EPA is working with California Air Resources Board (CARB), which has also accused FCA for the alleged federal Clean Air Act violations. EPA and CARB are starting a joint investigation against the automaker.

Importantly, the EPA said that its investigation is to check whether the software can be a possible defeat device like the one found in over 500,000 Volkswagen TDI models. FCA could be liable for civil penalties, but fines will still depend on the agency's findings.

Volkswagen recently admitted that it intentionally installed illegal software in its vehicles to trick government emissions testing for diesel engines. Volkswagen agreed to pay a $2.8-billion criminal fine and $1.5 billion in civil penalties for tampering test results and for lying to United States investigators about the essence of the scheme.

FCA CEO Sergio Marchionne quickly and angrily disputed the allegations that FCA violated the Clean Air Act with illegal emissions software. He immediately assembled a conference call with the media, saying that he fears the automaker will be compared to Volkswagen's massive emissions scandal.

Marchionne said that FCA is against wrongdoings and it never attempted to create a software to cheat emissions standards by identifying whether the vehicle is in test mode. The automaker completely disclosed all software used in its engines, Marchionne added.

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