FCA Continuing Diesel Settlement Talks with DOJ, CARB

Despite repeatedly denying any wrongdoing, Fiat Chrysler is in talks with the U.S. Justice Department and California Air Resources Board to reach a settlement about accusations it used illegal used software to beat diesel emissions tests.

The discussions, which according to multiple reports, are very far along, address allegations that FCA used the software, in a manner similar to Volkswagen’s diesel testing cheat device, for 104,000 U.S. diesel vehicles – mostly light trucks – sold since 2014.

According to Reuters, Ken Feinberg, an adviser in the process, at a federal court hearing in San Francisco revealed that government lawyers and Fiat Chrysler were swapping documents as part of the settlement process, which was moving “at a rather swift pace.”

A lawyer for Fiat Chrysler, Robert Giuffra, told Reuters the company and government lawyers were exchanging drafts of settlement documents. He said he expected a settlement would be reached “probably sometime during the summer.”

(Justice Dept. offers FCA settlement — with “substantial” fines for diesel scam. Click Here for the story.)

The Justice Department sent FCA a settlement proposal in late January that would require the company to offset excess pollution, prevent future excess emissions and required heavy civil penalties, Reuters reported in February.

Fiat Chrysler and the Justice Department have discussed some consumer-related provisions that could be part of a settlement including warranty and recall provisions. These talks have been ongoing and while the reports of increased activity imply a resolution may be closer, none of the parties proposed an end date to the talks.

(Click Here for details about Feinberg being selected to oversee FCA, DOJ and CARB talks.)

In December, Giuffra told a court that the automaker felt confident it could fix vehicles now on the road to bring them into compliance. That would become part of any settlement – if the EPA accepted that a fix can, indeed, be found.

One indication that this is possible came last July when the automaker was granted permission by both the EPA and the California Air Resources Board to resume sales of 2017 model-year diesel vehicles that are now considered compliant with standards. FCA is also hoping to work out a final settlement with U.S. owners of the rigged diesel vehicles sometime in the coming month.

There is still the question of resolving ongoing investigations in Europe, where thousands of the implicated vehicles were sold by FCA. German prosecutors have been especially aggressive, and they have launched investigations of two managers from the U.S. Bosch subsidiary alleging they may have aided and abetted fraud.

(EPA suspected Fiat Chrysler of diesel emissions cheating in 2015. Click Here for the story.)

Bosch technology was used in the rigged VW diesels, as well, but the supplier contends it is blameless, only supplying technology meeting Volkswagen’s specifications, not participating in any attempt to conceal a plot to evade emissions rules. Bosch has similarly denied involvement in FCA’s alleged scam.