WASHINGTON, June 2 (Reuters) – Chrysler’s parent company Stellantis (STLAM.MI) and General Motors (GM.N) paid a total of $363 million in civil penalties for failing to meet U.S. fuel economy requirements for earlier model years, such as Documents viewed on Friday show by Reuters show.
The record-breaking penalties include $235.5 million for Stellantis for the 2018 and 2019 model years and $128.2 million for GM for the 2016 and 2017 years, according to the National Highway Traffic Safety Administration (NHTSA), which established the Corporate Average Fuel Economy (CAFE) program administered .
Stellantis – which also owns Fiat, Peugeot and other brands – said the fine “reflects past performance prior to the formation of Stellantis and is not indicative of the company’s direction.”
Stellantis previously paid penalties totaling $156.6 million for the 2016 and 2017 model years.
GM said Friday, “As we work toward the goal of a zero-emissions future, we may use a combination of credits from previous model years, expected credits from future model years, credits received from other manufacturers, and payment of civil penalties to comply with increasingly stringent.” CAFE regulations.”
GM, which sells Chevrolet, Buick, GMC and Cadillac vehicles in the US, had never paid a fine in the CAFE program’s 40-year history. The company initially planned to use credit to make up for its shortcomings in compliance but opted to pay penalties, the NHTSA said.
According to the filings, the GM and Stellantis fines were paid between December and May. This is the first time in three years that the agency has issued penalties for fuel consumption.
NHTSA announced in April 2022 that there would be 11 cases between 2018 and 2021 “where significant civil penalties will be payable,” but did not provide details on the automakers involved.
The disclosure comes ahead of NHTSA’s plan to soon propose stricter fuel economy standards for 2027 and beyond, after the Environmental Protection Agency in April proposed a 56% reduction in projected average fleet emissions from 2026 requirements by 2032.
STRONG INCREASE
The EPA announced in December that Stellantis had the lowest real-world fuel economy of any major automaker, averaging 21.3 miles per gallon in 2021, while GM had the second-lowest fuel economy at 21.6 mpg.
In March 2022, NHTSA again introduced a drastic increase in penalties for automakers whose vehicles do not meet fuel efficiency requirements for 2019 and beyond.
For model years 2019 through 2021, the fine is $14 (instead of $5.50) for every 0.1 mile per gallon that new vehicles miss below required fuel economy standards multiplied by the number of noncompliant vehicles sold. For the 2022 model year, the value increased to $15.
Automakers protested the penalty increase in 2016, warning that it could increase industry costs by at least $1 billion annually, including an increase in the value of compliance credits sold by Tesla (TSLA.O) and others.
Automakers whose vehicles are more fuel efficient than required can sell credits to automakers that do not comply with CAFE rules.
Stellantis said it accrued an additional €660 million ($709 million) in accrual as a result of the NHTSA penalty increase.
In April 2022, NHTSA drastically raised fuel economy standards, reversing former President Donald Trump’s rollback of U.S. regulations to improve gas mileage. The organization increased fuel efficiency requirements by 8% for both model years 2024 and 2025, and by 10% in 2026.
Reporting by David Shepardson; Adaptation by Frances Kerry, Mark Potter and David Holmes
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