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Kia, Hyundai's costly mistake

2012-11-06 06:01

ADVERTISING FAULTS: Hyundai and Kia have agreed to reimburse nearly 1.1-million vehicle owners after admitting they overstated fuel consumption claims. The Hyundai Elantra was one of the cars involved in the investigation.

 
WASHINGTON - A lesson for automakers: Hyundai and Kia must reimburse owners of nearly 1.1-million vehicles in the US and Canada after admitting they overstated fuel-consumption claims on vehicle window stickers.

Earlier in 2012 Wheels24 reported on a California woman who won a similar case against Honda.

The Detroit News reported that the issue affected 172 000 vehicles in Canada and 900 000 in the US and came to light after an Environmental Protection Agency investigation turned up discrepancies between the window stickers and EPA testing.

SOME EXTRA CASH

The automakers will reimburse owners for as long as they own the cars, plus 15%. Hyundai said a typical owner of a vehicle in Florida driving 24 000km a year could get the equivalent of about R770 for 2012 in addition to future refunds for as long as they own the car.

Now, because of the faulty testing, Hyundai is retracting claims that three of its four 2013 models are capable of about 5.8 litres/100km.

John O'Dell, senior green-car editor at Edmunds.com, told the DetNews: "Whether an honest mistake or a deliberate corporate effort to fudge the numbers, the fact that the companies' ballyhooed 5.8 litres/100km cars are no longer members of that august club — and that Hyundai and Kia are repaying customers who relied on the faulty consumption claims when buying their cars - will be something that haunts the companies for a long tim.”

Jesse Toprak, senior analyst at TrueCar, said the correction by Hyundai may have a negative impact on people undecided about car choice. "However, even with the correction, the fundamentals of what made Hyundai and Kia brands a success in the US do not change.”

FALSE ADVERTISING

According to the DetNews the automakers said the fuel consumption rating discrepancies resulted from procedural errors during a process called "coast-down" testing at the companies' joint testing operations in Korea.

Consumer Watchdog said that following a barrage of consumer complaints, it had asked the EPA to audit the fuel consumption of the Elantra in January, 2012. It ultimately filed a false advertising suit against Hyundai for widely advertising the "40 mile per gallon Elantra" (US gallon = 3.785 litres).

Jamie Court, president of Consumer Watchdog said in the DetNews: "The EPA rightly audited Hyundai and the public deserves to know the whole truth about why these test results were inaccurate and whether or not they were intentionally falsified.”


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