Blog Coverage: Fiat Chrysler Applies for Diesel Vehicle Emissions Certification Even as the Federal Government Readies to File a Lawsuit against the Company
Upcoming AWS Coverage on Kandi Technologies Post-Earnings Results
LONDON, UK / ACCESSWIRE / May 23, 2017 / Active Wall St. blog coverage looks at the headline from Fiat Chrysler Automobiles N.V. (NYSE: FCAU) as the Company announced on May 19, 2017, that FCA US has filed an application for diesel vehicle emissions certification with the US Environmental Protection Agency (EPA) and the California Air Resources Board (CARB). The certification covers year 2017 models of Jeep® Grand Cherokee and Ram 1500 diesel vehicles which have been calibrated with the latest emissions software. Register with us now for your free membership and blog access at:
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One of Fiat Chrysler Automobiles' competitors within the Auto Manufacturers - Major space, Kandi Technologies Group, Inc. (NASDAQ: KNDI), announced on May 10, 2017, its financial results for Q1 2017. AWS will be initiating a research report on Kandi Technologies in the coming days.
Today, AWS is promoting its blog coverage on FCAU; touching on KNDI. Get all of our free blog coverage and more by clicking on the link below:
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FCA US has been working in close collaboration with EPA and CARB to clarify the issues with regards to the Company's emission control technology. Once the Company receives the blessing from EPA and CARB for its updated emissions software, it plans to install the same in all the 2014-2016 year diesel models of Dodge Ram and Jeep Grand Cherokee. FCA US believes that this initiative will help address the concerns raised by the EPA and CARB with regards to the Company's emissions software calibrations of these vehicles. The decision will impact FCA's 104,000 light-duty vehicles and trucks.
FCA US also believes that the Company's initiative will help the ongoing discussions with the Environment and Natural Resources Division of the US Department of Justice and other federal agencies.
Once the Company receives the certification from EPA and CARB, it will install the updated emissions software in all the vehicles of 2014-2016 models identified. This will be done at the Company's dealerships and the owners will be notified accordingly. FCA US is confident that the updated emissions software will improve the identified vehicles emissions performance. However, the Company is sure that the calibration of the updated software will not have any impact on the performance or fuel efficiency of the identified vehicles.
The US Justice Department and the EPA have yet to comment on the Company's application for certification.
Background
EPA had issued a notice of violation to FCA in January 2017 for failing to comply and implement regulations of the Clean Air Act. EPS noted that the Company failed to inform the Agency about the Auxiliary Emission Control Devices (AECDs) installed in nearly 104,000 of its 2014-2016 year diesel models of Dodge Ram and Jeep Grand Cherokee. Due to these AECDs, these diesel vehicles emitted nitrogen oxides under various operating conditions. EPA noted that FCA had failed to inform the Agency about this and hence did not satisfy the emission standards for air pollution applicable for the category of FCA's identified models.
Sergio Marchionne, CEO of Fiat had defended the Company and denied the EPA's allegations at the time. Later on, he admitted that FCA US may have unintentionally made mistakes.
The maximum fine FCA could face for the 104,000 affected vehicles could be as high as $4.6 billion, at $44,539 per vehicle.
EPA's notice to FCA US was in the wake of Volkswagen AG's (VW) admission in 2015 that it used defeat devices that turned on emissions controls to pass tests. The EPA issued a notice in 2015 to VW for violations of EPA's emissions norms. EPA noted that VW's 2009-2015 year models with 2.0 liter diesel engine and 2014-2016 year diesel cars and SUVs with 3.0 liter diesel engines used a software that circumvents EPA emissions standards for certain air pollutants. The matter was solved in January 2017, when VW agreed to pay $2.8 billion criminal penalty in addition to $1.5 billion for civil penalties covering EPA's claims.
US Department of Justice readies to file a lawsuit
Following a news report from Reuters on May 17, 2017, it was speculated that the US Justice Department (DOJ) was readying to file a lawsuit against FCA within a week, for diesel emissions. The matter will be decided on May 22, 2017, as a federal judge in California has agreed to hearing for lawsuits filed by vehicle owners against FCA. In the event that no agreement is reached between FCA and the owners, the DOJ is expected to file a lawsuit against the Company.
FCA already faces a legal action from the European Commission (EC). On May 17, 2017, EC sent a formal notice to Italy for failing to take action against FCA, with regards to the emission control strategies employed by the Company.
Stock Performance
On Monday, May 22, 2017, Fiat Chrysler Automobiles' shares climbed 2.48%, finishing the day at $10.76 with volume of 5.78 million shares exchanging hands by the close of the trading session. Fiat Chrysler Automobiles' stock price skyrocketed 44.04% and 52.84% in the past six months and the last twelve months. Furthermore, on a year to date basis, the stock surged 17.98%. Shares of the company have a PE ratio of 7.66 and currently have a market cap of $16.54 billion.
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