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US Fuel Economy Penalties Cost Stellantis and GM $363 Million.

Chrysler-parent Stellantis and General Motors have paid a total of $363 million in civil penalties for failing to meet US fuel economy requirements for previous model years, according to documents seen by Reuters. Stellantis paid $235.5 million for the 2018 and 2019 model years, and GM paid $128.2 million for the 2016 and 2017 model years. Stellantis claimed that the penalties reflected previous performance before the formation of Stellantis and did not indicate the company’s current direction. GM said it was working towards a zero-emissions future, and it might use a combination of credits from prior model years, expected credits from future model years, credits obtained from other manufacturers, and payment of civil penalties to comply with increasingly stringent CAFE regulations.

The GM and Stellantis penalties were paid between December 2020 and May 2021. This is the first time in three years that the National Highway Traffic Safety Administration (NHTSA) has collected fuel economy penalties. The disclosure comes ahead of NHTSA’s plan to propose new, more stringent fuel economy standards for 2027 and beyond. In March 2022, NHTSA reinstated a sharp increase in penalties for automakers whose vehicles do not meet fuel efficiency requirements for 2019 and beyond. For the 2019 to 2021 model years, the fine is $14, up from $5.50, for every 0.1 mile per gallon new vehicles fall short of required fuel-economy standards, multiplied by the number of noncomplying vehicles sold. For the 2022 model year, the figure rose to $15.

Automakers whose vehicles achieve higher fuel economy than required can sell credits to automakers that do not meet CAFE rules. The higher penalty costs make the credits more valuable, automakers say. Automakers protested the penalty hike in 2016, warning that it could raise industry costs by at least $1 billion annually, including boosting the value of compliance credits sold by Tesla and others.

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Derrick Santistevan
Derrick Santistevan
Derrick is the Researcher at World Weekly News. He tries to find the latest things going around in our world and share it with our readers.

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