Hyundai, Kia MPG Flap Reaches Congress, May Spark Other Probes

November 30, 2012

Is your car as efficient as it's supposed to be? Can you achieve the EPA estimates found on its window sticker? The Hyundai/Kia fuel-economy flap has many drivers -- and members of Congress -- asking these same questions.

Brace yourselves: investigations of other makes and models could be just around the corner.

To recap

The EPA recently announced that, in light of numerous consumer complains, it had conducted fuel-economy audits of Hyundai and Kia vehicles. The findings weren't good: in all, 13 Hyundai and Kia models failed to achieve their advertised fuel efficiency. Some fell short by one mile-per-gallon, while others -- like the popular Kia Soul -- were off by six.

Hyundai and Kia have admitted fault and developed a plan to compensate 900,000 owners in the U.S. and another 172,000 in Canada. The initial plan is to send out debit cards to those drivers every year; the amount credited to each card will vary, based on owners' real-world mileage. Hyundai and Kia will reimburse drivers for the additional money they've spent on gas -- money that they wouldn't have spent if their vehicles had earned the proper fuel economy -- plus a 15% premium.

Current estimates peg the cost of these reimbursements at around $100 million per year, payable for as long as the owners drive the affected vehicles. However, there are some class-action lawsuits pending that could push the pricetag much higher.

Also, the EPA says that it's continuing to test Hyundai and Kia vehicles; if other models come up short, it could cost the Korean automakers even more. And the agency has refused to say whether Hyundai and Kia will be slapped with fines.

What's new

Now, Congress is getting involved. Yesterday, Senator Jay Rockefeller (D-WV), who chairs the U.S. Senate Committee on Commerce, Science, and Transportation, has sent letters to both Hyundai and Kia. While he applauds their efforts to rectify the situation, he goes on to say:

I am concerned that many affected customers may not learn about the program or may find it burdensome to participate in the program. To help the committee better understand what steps your company is taking to remedy the harm your inaccurate fuel economy statements caused to consumers, please provide responses to the following questions:

1. How does your company plan to maximize the effectiveness and accessibility of the consumer rebate program?

2. What are your company's plans to monitor the program and to reach consumers who may not initially take advantage of it?

Please provide the answers to these questions by December 14, 2012.

And that's not all: Rockefeller says that he'll be paying close attention to the EPA investigation to see "how Hyundai and Kia may have used the inflated fuel economy numbers to attract customers, and how federal enforcement agencies can better deter similar violations in the future." Bottom line: the Senator and his colleagues are taking this very, very seriously.

The ripple effect

The EPA investigation of Hyundai and Kia is being closely watched by others, too -- namely, automakers who do business in the U.S. Reporting from the Los Angeles Auto Show, AutoNews says that industry analysts and CEOs are taking a long hard look at mileage figures for other makes and models, checking their math to make sure those numbers are accurate.

According to that article, reps from Chrysler, General Motors, Honda, Mazda, Nissan, and Toyota have all gone on record to express confidence in their vehicles' stated fuel economy.

Missing from that list: Ford. Perhaps that's because the reporter hadn't yet gotten around to asking Ford for comment. However, it's also possible that Ford is worried that the advertised fuel economy figures for its 2013 Fusion Hybrid and 2013 C-Max Hybrid may not be entirely on-the-nose.

As our colleagues at Green Car Reports have mentioned, both vehicles have been driven extensively by auto journalists, and many of those writers have complained that they've been unable to achieve their stated fuel economy under real-world conditions. Admittedly, we're reaching a new era in the auto industry -- one in which current standards of fuel economy need updating. But Ford's troubles may be something different.

One AutoNews writer topped out the C-Max Hybrid at a combined 37 mpg, when it was supposed to earn 47 mpg.

The Fusion Hybrid's combined fuel economy is also advertised as 47 mpg, but when a Bloomberg author took it for a spin, he only managed 36.9 mpg. Stats from two owners of the vehicle have come in even lower, at 35 mpg. 

The EPA hasn't announced plans to investigate Ford -- or any other automaker, for that matter. But depending on what's uncovered in the ongoing Hyundai/Kia investigation, this may become a much bigger problem for automakers in the U.S.

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