Published 22:38 IST, October 12th 2019
Hyundai and Kia earmark $760 million to settle US lawsuits over recall
Hyundai Motor Corporation and affiliate Kia Motor Corp have set aside $758 million to settle US class action litigation and address engine-related difficulties
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As per reports, Hyundai Motor Corporation and affiliate Kia Motor Corp have set aside $758 million to settle US class action litigation and address engine-related difficulties in United States and South Korea. The move has come as a result of Auto giant's major effort to solve years of trouble over engine defects which has resulted in probes by US safety authorities and prosecutors.
Provision of $758 million
Reports suggest that Hyundai Motors will make a provision of about 600 billion won ($510 Million) in its July to September earnings while Kia will make 300 billion won ($250 Million), both companies have said on October 11. The statement said that under the US settlement it will install software to monitor any symptoms which can reveal the possibility of engine failure and take other steps which include compensation options and lifetime warranties. Around 4.17 million Hyundai and Kia models which were equipped with Theta II gasoline direct injection (GDI) engines will be affected by the US. Settlement. Hyundai and Kia together are the world's fifth-largest automaker by sales had recalled nearly 1.7 million vehicles in the United States to investigate the possibility of engine fires. In November, there were reports that US federal prosecutors had launched a criminal investigation to decide whether the recalls were done properly.
History of investigation
From the year 2017, U.S safety authority has been investigating whether the recalls had covered enough vehicles and whether they were conducted in a time-bound manner. The investigation has come in the wake of Kim Gwang-ho was an engineer at Hyundai and flew to Washington in 2016 to tell National Highway Traffic Safety Administration (NHTSA) the companies should have recalled more vehicles over the problem, citing an internal report which at Hyundai Motors had denied at that point of time.
This year the NHTSA started a fresh investigation into 3 million Hyundai and Kia vehicles after going through reports of over 3,000 fires that injured more than 100 people. The investigation came in response to a petition of more than 3,000 fires which injured more than 100 people. The NHTSA this year opened a fresh investigation into 3 million Hyundai and Kia vehicles after reviewing reports of more than 3,000 fires that injured more than 100 people. The probe came in the wake of a petition which was filed in July by non-profit Centre for Auto Safety.
(With inputs from agencies)
20:13 IST, October 12th 2019