Stellandis, GM to pay $363 million in US fuel economy fines: Reuters

The logo of Stellantis, the world’s fourth-largest automaker, which will begin trading in Milan and Paris after Fiat Chrysler and Peugeot maker PSA finalized their merger, is seen next to a car on display at the main entrance of the FCA Mirafiori plant in Turin, Italy, in January. 18, 2021.

Massimo Pinca | Reuters

Chrysler-parent Stellandis and General Motors have paid a total of $363 million in civil penalties for failing to meet U.S. fuel economy requirements for previous model years, documents seen by Reuters showed on Friday.

According to the National Highway Traffic Safety Administration (NHTSA), which administers the Corporate Average Fu program, the registration penalties include $235.5 million for Stellandis for the 2018 and 2019 model years and $128.2 million for GM covering 2016 and 2017.

Stellandis said the penalties „reflect past performance recorded prior to the formation of Stellandis and are not indicative of the company’s direction.” Stellandis paid a total of $156.6 million in fines for the 2016 and 2017 model years.

GM, which did not immediately comment, has never paid a fine before in the CAFE program’s 40-year history. It initially planned to use the credits to cover its compliance shortfall, but chose to pay the fine, NHTSA said.

A sign with the General Motors Quality Work Statement is located in the lobby at the GM Warren Tech Center in Warren, Michigan.

Rebecca Cook | Reuters

The GM and Stellantis fines were paid between December and May, and are the first time the company has levied fuel economy penalties in three years.

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The revelation comes ahead of NHTSA’s plan to soon propose new tougher fuel economy standards for 2027 and beyond.

In March 2022, NHTSA reinstated a sharp increase in penalties for automakers that do not meet fuel efficiency requirements in 2019 and beyond.

For model years 2019 through 2021, the penalty is $14, up from $5.50 for each gallon of new vehicles that fall below the required fuel-economy standards by 0.1 miles, multiplied by the number of vehicles not sold. For the 2022 model year, this number rises to $15.

Automakers opposed the increased fines in 2016, warning that they could raise industry costs by at least $1 billion annually, including increasing the value of compliance credits sold by Tesla and others.

Automakers that achieve higher fuel economy than required can sell credits to automakers that don’t meet CAFE rules.

Higher penalty costs make credits more valuable, automakers say.

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