FCA Diesel Settlement Could Involve A Recall And “Very Substantial” Fines

Fiat Chrysler’s diesel scandal is back in the news as Bloomberg is reporting the company is facing a recall and “very substantial civil penalties.”

According to the publication, the United States Department of Justice has offered to settle its lawsuit against the automaker if the company agrees to recall 104,000 vehicles and pay an undisclosed fee. The settlement offer was reportedly given to FCA last week and is said to have included “steps it would have to take to mitigate its past pollution and internal changes to prevent future violations of environmental rules.”

The proposed agreement didn’t put a price tag on the penalties but it noted they must by “very substantial” and “adequately reflect the seriousness of the conduct that led to these violations.” Given the relatively low number of vehicles involved in the recall, it is likely the government won’t be seeking as much competition as it did from Volkswagen. However, the government wants to automaker to pay enough so FCA and other companies are discouraged from cheating on emissions in the future.

FCA representatives declined to comment on the proposed agreement but it would reportedly only end the government’s civil suit. As a result, the DOJ’s criminal investigation would continue.

If FCA were to accept the settlement offer, the company would reportedly be agreeing to recall and fix Jeep Grand Cherokees and Ram 1500s that were equipped with the 3.0-liter EcoDiesel V6 engine. The 104,000 vehicles involved in the recall are said to cover the 2014-2016 model years.

FCA CEO Sergio Marchionne has repeatedly denied the allegations but the company has previously warned investors it could be facing billions in fines.