Fiat Chrysler, in Settlement Talks With U.S., Is Under More Pressure
FRANKFURT — Fiat Chrysler Automobiles, one of the world’s biggest carmakers, said on Thursday that it was in talks with the Department of Justice to settle an investigation into diesel emissions cheating.
The announcement was made as an academic study found evidence the company had illegally used software to evade emissions rules, piling pressure on the automaker when it is suffering from meager profitability.
The new study adds to evidence that the company flouted the rules on diesel emissions, much like the German carmaker Volkswagen, which has been hit with billions of dollars of settlements and fines, and seen several executives investigated or charged. Though Fiat Chrysler’s financial damage is unlikely to be as costly as Volkswagen’s, the emissions cheating, if proven, could still be expensive.
In the latest study, researchers from the University of the Ruhr in Bochum, Germany, and the University of California, San Diego, said they found evidence of a so-called defeat device in a diesel Fiat 500X, a compact S.U.V. sold in Europe. Software in the engine’s computer reduced pollution controls 26 minutes after the car was started, according to the study. A standard emissions test procedure lasts a little less than 26 minutes. Fiat Chrysler declined to comment on allegations of cheating in the 500X.
The authors, who are professors and graduate students, provided The New York Times and several other news organizations with advance copies of the study, which is scheduled to be published next week.
Fiat Chrysler was already under suspicion. In January, the Environmental Protection Agency accused the carmaker of violating clean air rules in about 100,000 Dodge Ram and Jeep Grand Cherokee vehicles. The Justice Department has since been investigating.
The company said in a statement that it was in talks with the Justice Department and “is seeking a fair and equitable resolution to this matter.” But Fiat Chrysler also said it would defend itself “against any claims that the company deliberately installed defeat devices to cheat U.S. emissions tests.”
The term “defeat device” refers to software installed on vehicles to allow them to deliberately evade pollution standards by detecting when a car is being tested in a laboratory for its emissions levels.
Volkswagen’s use of such illegal software in 600,000 Volkswagen, Audi and Porsche diesel cars sold in the United States, out of 11 million fitted with the device worldwide, has caused it enormous problems.
Six employees have been charged in the United States over the deception and another has pleaded guilty while Volkswagen’s chief executive is being investigated by German prosecutors. The company has already agreed to pay criminal and civil penalties of $4.3 billion under the terms of a plea agreement with American authorities.
But other carmakers are also under scrutiny.
Daimler, the maker of Mercedes cars, has disclosed that the Justice Department is investigating emissions of its diesel vehicles in the United States and that prosecutors in Stuttgart, Germany, have opened a criminal investigation. The French government is investigating possible emissions fraud by Renault-Nissan.
In Europe, diesel pollution has become a major political issue. Volkswagen’s cheating exposed weak enforcement of emissions regulations by governments protecting their domestic automakers. European governments have been pointing fingers at one another, straining relations.
On Wednesday, the European Union’s executive arm formally accused the Italian government of allowing Fiat Chrysler to sell cars designed to evade emissions tests. The European Commission had already begun similar so-called infringement procedures against seven other nations, including Germany and Britain.
In all the cases, the countries are accused of not enforcing common European rules on emissions.
Studies by the French, British and German governments have established that diesel vehicles by virtually all carmakers pollute far more on the road than in the carefully controlled conditions of an emissions testing lab. In a French study, the Fiat 500X was one of the cars with the biggest discrepancies between road and lab emissions.
With the exception of Volkswagen, though, European carmakers have been able to escape consequences because of loopholes in European rules that allow carmakers to throttle down pollution controls to protect the engine.
Carmakers have made liberal use of that exception. But there is a growing backlash from residents angry about bad air quality caused by diesel cars in big cities like Paris or Stuttgart, the home of Daimler.
Diesel sales in Europe have been slumping as buyers become more aware of the cost to human health and the environment. That is a big threat to carmakers. Diesel accounts for about half of all cars sold in Europe, and it is also crucial for automotive manufacturers to meet fuel efficiency standards. Diesel engines burn fuel more efficiently than gasoline motors, but they produce more harmful nitrogen oxides.
A study published this week by the International Council on Clean Transportation, a nonprofit group that played a crucial role in exposing Volkswagen, concluded that excess nitrogen oxide fumes from diesel engines were responsible for 38,000 premature deaths worldwide in 2015. An estimated 11,500 of those were in Europe.
Fiat, however, went beyond just exploiting loopholes in European regulations, according to the study scheduled to be released next week at the Institute of Electrical and Electronics Engineers Symposium on Security and Privacy in San Jose, Calif.
The researchers sought to detect defeat devices by analyzing engine software, which is less time consuming and less expensive than analyzing tailpipe emissions from moving cars.
The study, financed by the European Union and the National Science Foundation in the United States, asserts that documentation for the Fiat 500X’s engine software described two modes.
One mode, labeled “homologation,” or approval, kept emissions low. During a second mode, labeled “RDE” — an acronym for “real driving emissions” — pollution control equipment was dialed back to improve fuel economy.
Fiat Chrysler declined to comment on the findings of the report.
The study also raises question about Bosch, the German company that supplied engine computers and software to both Fiat and Volkswagen.
“We find strong evidence that both defeat devices were created by Bosch and then enabled by Volkswagen and Fiat for their respective vehicles,” the study said.
Bosch said it could not comment in detail because of continuing investigations and lawsuits.
But it said in a statement, “Bosch supplies these components to the automaker’s specifications. It is always each automaker’s responsibility to calibrate and integrate components into the overall vehicle system, as well as to obtain approval from the local registration authorities.”