EPA warned Fiat Chrysler of illegal defeat device – MarketWatch

Posted: Saturday, June 17, 2017

The U.S. Environmental Protection Agency alerted Fiat Chrysler Automobiles NV in November 2015 that regulators suspected the Italian-U.S. auto maker of using illegal emissions software, more than a year before formally accusing the company of skirting U.S. clean air law.

Environmental regulators told Fiat Chrysler employees about their concerns during a Nov. 25, 2015, meeting, according to emails the EPA released on Friday in response to an open records request.

The regulator at the time was scrutinizing emissions in diesel-powered vehicles after Volkswagen in September 2015 admitted to using so-called “defeat devices” to allow cars to pass government tests and then pollute the air far beyond legal limits. The new disclosure indicates regulators had begun to probe Fiat Chrysler’s emissions practices within weeks of Volkswagen’s crisis becoming public.

West Virginia University researchers earlier this week revealed they had uncovered significant emissions discrepancies with the same kinds of Fiat Chrysler vehicles U.S. officials are scrutinizing, resembling findings they shared that helped uncover Volkswagen’s long-running deception. Fiat Chrysler has disputed the university’s findings and said it attempted to discuss them with the researchers.

Earlier this year, the EPA formally accused Fiat Chrysler of failing to disclose emissions-control software on nearly 104,000 diesel-powered Jeep Grand Cherokee sport-utility vehicles and Ram pickup trucks in violation of the federal Clean Air Act. In May, the U.S. Justice Department sued Fiat Chrysler and accused the auto maker of using illegal defeat devices.

Fiat Chrysler has denied using defeat devices and offered a fix it believes will address regulators’ concerns.

The auto maker said Friday the disclosed emails show it has been engaging with regulators to resolve the issue and reiterated its denial of intentionally undermining emissions tests. Fiat Chrysler said that it will “vigorously defend itself in court against any claims that it engaged in any deliberate scheme to install defeat devices.”

Byron Bunker, the EPA Office of Transportation and Air Quality compliance division director, reminded a Fiat Chrysler official of the concerns the government had communicated to the company in the November 2015 meeting, according to one email dated Jan. 7, 2016.

Mr. Bunker wrote that Fiat Chrysler’s use of auxiliary emission-control devices “appears to me to violate EPA’s defeat device regulations.” In a Jan. 11, 2016, reply addressed to Chris Grundler, head of the Office of Transportation and Air Quality, an executive at the auto maker urged regulators to “reserve conclusions on that question” and noted the violation allegation has “potentially significant regulatory and commercial consequences.”

The company has been unable to sell 2017 model year versions of Jeep and Ram vehicles built with diesel engines as it awaits certification of them by the EPA. Fiat Chrysler has said it has made modifications to those vehicles’ emissions-software calibrations, but regulators have withheld permission so far.

Write to Mike Spector at mike.spector@wsj.com and Chester Dawson at chester.dawson@wsj.com


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