Chrysler parent Stellantis paid $190m in US fuel economy penalties

Chrysler parent Stellantis paid $190.7m (R3.48bn) in civil penalties for failing to meet US fuel economy requirements for 2019 and 2020 and owes another $459.7m (R8.39bn) in outstanding penalties, government documents seen by Reuters show.

The penalties, paid in March and May, were disclosed by the National Highway Traffic Safety Administration (NHTSA), which administers the Corporate Average Fuel Economy programme, on a government website.

The disclosure shows the significant compliance costs to meet US fuel rules even as carmakers are spending billions of dollars to build electric vehicles (EVs).

Stellantis, which also owns Fiat, Peugeot and other brands, said the penalties were incurred before it was created in 2021. It said the penalties are “not indicative of the company’s direction”, saying it is investing more than €50bn (R2.97bn) worldwide to produce EVs, including two dozen US market EVs by 2030.

The carmaker and the NHTSA on Friday confirmed Reuters' calculation of the outstanding penalties.

The Italian-American carmaker in 2023 paid a record-setting $235.5m (R4.3bn) for the 2018 and 2019 model years in fuel economy penalties and $156.6m (R2.860bn) in penalties for the 2016 and 2017 model years.

In March 2022, the NHTSA reinstated a sharp increase in penalties for carmakers whose vehicles do not meet fuel efficiency requirements for 2019 and beyond, nearly tripling the penalties.

Last year the NHTSA said its proposal to extend fuel economy standards to 2032 would cost the industry $14bn (R255.57bn) in projected fines over five years, including:

• $6.5bn (R118.75bn) for General Motors;
• $3bn (R54.76bn) for Stellantis; and
• $1bn (R18.25bn) for Ford.

Under the rules finalised last month, the car industry is collectively expected to face a total of $1.83bn (R33.4bn) in fines from 2027 2031 — and it could be nothing, the NHTSA said.