Hyundai Issues $55 Million Apology For Overstating Fuel Economy On The South Korean Santa Fe

August 12, 2014

In the fall of 2012, Hyundai and its sibling, Kia, were making headlines (not the good kind).

Numerous Hyundai and Kia owners in the U.S. had written to the Environmental Protection Agency, complaining that their vehicles' fuel economy wasn't as good as Hyundai and Kia had promised. The EPA investigated and found that 13 Hyundai and Kia models failed to live up to their advertised fuel economy ratings. Owners sued, Congress got involved, and last December, the two companies agreed to shell out $395 million as a way of saying "We're sorry".

According to Reuters, Hyundai is in hot water again. In the wake of the EPA probe, South Korean officials decided to do some checking of their own. And unfortunately for Hyundai, they determined that the automaker has been overstating the MPGs on the South Korean version of its popular 2.0-liter Santa Fe SUV.

Of course, regulators understand that fuel economy is an inexact science. The mileage vehicles earn in labs and on test tracks can vary significantly from the numbers they generate in the real world, thanks to variations in climate, topography, and other factors. That's why they allow for a variance of five percent from stated fuel economy. However, the Santa Fe's figures were off by an unacceptable 8.3 percent, meaning that Hyundai has had to haul out the checkbook.

Today, Hyundai announced plans to:

1. Pay a fine of 1 billion won ($1 million) to the transport ministry of South Korea. 

2. Pay each Santa Fe owner around 400,000 won ($388.61) to compensate them for the fuel economy shortcoming. Since the payouts will go to around 140,000 owners, that could cost Hyundai up to 56 billion won ($54.41 million).

3. Change the stated fuel economy on the Santa Fe from 14.4 kilometers per liter to 13.8 kilometers per liter.

 No word yet on whether Kia will be subjected to the same scrutiny. Stay tuned.

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