Fiat Chrysler shares slide on US emissions probe

Fiat Chrysler said in a statement on Thursday that it is “disappointed” with the Environmental Protection Agency assertions.

Shares in Fiat Chrysler dropped as much as 18% as the US Environmental Protection Agency accused Fiat Chrysler of using software that allowed excess diesel emissions in 104,000 US trucks and SUVs sold since 2014, the result of a probe that stemmed from regulators’ investigation of rival Volkswagen.

The EPA and California Air Resources Board told the automaker it believes its undeclared auxiliary emissions control software allowed vehicles to generate excess pollution in violation of the law.

Fiat Chrysler said in a statement on Thursday that it is “disappointed” with the EPA assertions.

It also said that its “diesel-powered vehicles meet all applicable regulatory requirements.

The car maker said it will prove to the EPA that its emissions controls are “properly justified and thus are not ‘defeat devices’ under applicable regulations.”

Regulators said the company failed to disclose engine management software in 104,000 US 2014 to 2016 Jeep Grand Cherokees and Dodge Ram 1500 trucks with 3.0-litre diesel engines.

The undisclosed software results in increased emissions of nitrogen oxides from the vehicles. EPA is still investigating if the software constitutes a “defeat device”.

“Failing to disclose software that affects emissions in a vehicle’s engine is a serious violation of the law, which can result in harmful pollution in the air we breathe,” said Cynthia Giles, an EPA official.

VW agreed to pay $4.3bn (€4bn) in criminal and civil fines and plead guilty to three felonies for misleading regulators and selling polluting vehicles.

California Air Resource Board chair Mary Nichols said, “Once again, a major automaker made the business decision to skirt the rules and got caught.”

Fiat Chrysler’s Milan-listed shares erased more than one-tenth of their value in just 20 minutes of trading after the news. The stock was automatically suspended several times, weighing on the auto sector and wider European stock markets.

The EPA announcement comes amid rising scrutiny by EPA of automaker emissions after Volkswagen admitted to cheating diesel emissions tests in 580,000 US vehicles.

— Reuters