June 16, 2017 / 6:13 PM / 4 months ago

EPA suspected Fiat Chrysler of using 'defeat device' in 2015

WASHINGTON (Reuters) - U.S. regulators told Fiat Chrysler Automobiles NV (FCAU.N) in November 2015 that they suspected some of the automaker’s vehicles were equipped with secret software allowing them to violate emission control standards, according to emails disclosed on Friday.

A specialist trader works at the post where Fiat Chrysler Automobiles is traded on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 8, 2017. REUTERS/Brendan McDermid

The U.S. Environmental Protection Agency and California Air Resources Board accused Fiat Chrysler in January of using the software, known as a “defeat device,” to illegally allow excess diesel emissions in 104,000 U.S. 2014-2016 Jeep Grand Cherokees and Dodge Ram 1500 trucks.

Byron Bunker, director of the EPA’s Transportation and Air Quality compliance division, said in a January 2016 email to Fiat Chrysler, obtained by Reuters under the Freedom of Information Act, that he was “very concerned about the unacceptably slow pace” of the automaker’s efforts to explain high nitrogen oxide emissions from some of its vehicles.

Nitrogen oxide is linked to smog formation and respiratory problems.

Bunker’s email said the EPA had told Fiat Chrysler officials at a November 2015 meeting that at least one auxiliary emissions control device on the car maker’s vehicles appeared to violate the agency’s regulations.

Mike Dahl, head of vehicle safety and regulatory compliance for Fiat Chrysler’s U.S. unit, responded in a separate email that the company was working diligently and understood the EPA’s concerns. He added that if the EPA identified Fiat Chrysler vehicles as containing defeat devices it would result in “potentially significant regulatory and commercial consequences.”

The documents redacted the vehicles named, but two officials briefed on the matter said they referred to diesel models.

The EPA’s November 2015 meeting with Fiat Chrysler came two months after Volkswagen AG (VOWG_p.DE), mired in a major tailpipe emissions scandal, admitted to installing secret defeat device software in hundreds of thousands of U.S. diesel cars to make them appear cleaner than they were on the road.

At an event in Venice on Friday, Fiat Chrysler Chief Executive Sergio Marchionne said he was “confident of the fact that there was no intention on our part to set up a defeat device that was even remotely similar to what (Volkswagen) had in their cars.”

Fiat Chrysler said in a statement, meanwhile, that the emails showed it had been “meaningfully engaged with the EPA regarding its diesel engine emissions for an extended period of time.”

In Venice, Marchionne also said he expected regulators will soon approve a software fix that will allow the company to sell 2017 U.S. diesel models. The same fix will be used to update and resolve concerns about 2014-2016 cars, he said.

The Justice Department sued Fiat Chrysler in May, saying it placed eight undeclared “defeat devices” in 2014-2016 Fiat Chrysler diesel vehicles that led to “substantially” higher than allowable levels of nitrogen oxide.

The department also has a separate criminal probe into the matter.

Reporting by David Shepardson Additional reporting by Agnieszka Flak in Venice; Editing by Steve Orlofsky and Tom Brown

Our Standards:The Thomson Reuters Trust Principles.
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