So Far, the FCA Diesel Scandal is not a Repeat of the VW Emissions Scandal

Because Volkswagen was found to be cheating in regards to the emissions regulations that were in place it’s easy to assume the same of FCA and the allegations they’ve been cheating as well. Volkswagen was found to have installed a defeat device in many of their vehicles that were powered by small diesel engines in order to beat the testing. This was a deliberate action on their part and one that resulted in many of these vehicles being capable of producing more than forty times the allowable emissions.

While the US Government has accused Fiat Chrysler Automobiles of having undisclosed software in some of the diesel engines of the pickup trucks and SUVs it produces, so far there are vastly different circumstances between the two. While having undisclosed software that could alter the emissions put into the air is a violation of the Clean Air Act, FCA has not been asked to stop selling their vehicles as of yet, which is one of the biggest differences between the two scenarios. Also, FCA hasn’t been accused of intentionally trying to defeat the emissions testing at this point.

While the EPA has accused FCA of installing eight pieces of software that can alter the emissions of a vehicle, there are some differences that we should discuss. Here are three important questions that need to be answered in this case:

Was the software developed with the intent of cheating on the emissions testing?

Right now this question is still under investigation and this could be the most important aspect of this particular inquiry. The head of FCA has denied any cheating took place and FCA has cooperated fully to this point. Once this question is answered we’ll know a great deal more about whether or not FCA did cheat intentionally or the software is meant for another purpose.

How widespread is the exposure of this scandal compared to the one for VW?

Even though this shouldn’t matter much, the reality is VW had to pay for what amounts to more than half a million vehicles that had the defeat devices. Their scandal also led to a massive company shakeup and the distrust of the US market, not to mention the nearly $20 billion in fines and criminal charges. While the number for FCA is only around 104,000 the EPA has the right to find automakers for over $44,000 per vehicle affected which has the FCA investors on the edge of their seats as they wait for the results.

What’s the next course of action?

If FCA is found to have not acted intentionally they may face a small fine and the need to recall and repair the affected vehicles. If they are found to be guilty of intentionally installing defeat devices, it’s hard to say exactly what will happen, but you can bet it will probably be a course of action similar to that which took place at Volkswagen.

Right now this seems to possibly be the result of unintended consequences that emissions are altered by these eight pieces of software. Even with that said, the regulations are clear and FCA was required to report these to the EPA before installing and selling vehicles with the software installed. What’s even more interesting is the fact that we’re about to have a new Presidential administration and this case could fall under the new administration which might be more lenient on FCA than the previous one. That might be what the CEO of FCA is hoping for, but for his part, I hope FCA wasn’t intentionally trying to skirt EPA emissions regulations.

01.27.17 - FCA Offices

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