Wednesday, February 15, 2017

What's Going to Happen to Cheating Companies Under a New EPA? -- a Guest Post

(Clean Air Watch is pleased to present this timely guest post by Gemma Hunt)


While we await a Senate vote on Scott Pruitt's nomination to head the U.S. Environmental Protection Agency, an important question lingers in the air: what will happen to enforcement of clean air and water laws under the Trump team?  Will companies feel they can cheat -- and harm the public -- as Volkswagen did?  

The recent Fiat Chrysler incident could be a test case.


Accusations of Clean Air Act Violations for Fiat Chrysler 

After the Volkswagen scandal which broke last year, and saw the company guilty of cheating their emissions testing, it seems the latest car company under fire for their violations of the Clean Air Act is Fiat Chrysler.  The company stands accused by the Environmental Protection Agency of installing engine management software into several of its passenger vehicles in order to cheat their way through emissions tests. This software allows vehicles that are utilizing it to operate differently during emissions tests than they will when they are functioning normally on the open road: this means they might well pass their emissions tests in isolation, but would actually be breaching the clean air act and emitting levels of nitrogen oxides that are simply too high in reality .The breach is thought to have affected approximately 104,000 models of Jeep Grand Cherokee SUVs and Dodge Ram 1500 pickup trucks with 3.0-liter diesel engines that were built in the 2014, 2015 and 2016 model years.

Dual Investigations Are Underway

The EPA is not the only agency to be investigating the company for this breach: the California Air Resources Board (or CARB) have also issued a violation against Fiat Chrysler and the company remains under investigation from both agencies.  The investigation will determine whether the  auxiliary emission control devices which were put into the two vehicle types in question are actually classified as defeat devices (which are illegal). If they are found guilty then Fiat Chrysler Automobiles would be liable for both civil penalties (which in itself could cost them millions of dollars) and injunctive relief.

Illegal or not, using this kind of software is certainly immoral, and is pumping more emissions into our air than is currently being declared by the firm. Not only are firms that use this kind of software lying to the EPA, they are also lying to their customers who are not receiving the emission levels they were promised, potentially exposing their family and loved ones to dangerously high levels of emission chemicals, such as nitrogen oxide. Nitrogen oxide from motor vehicles is one of the largest causes of air pollution, and is particularly dangerous to those individuals who live near busy roads or in industrial areas. Regular exposure to nitrogen oxide can lead to respiratory health complaints and allergic reactions: to make it clear, nitrogen oxide is a pollutant which can have a direct impact on human health, and therefore cheating emissions tests in this way could ultimately put lives at risk. Cynthia Giles, the assistant administrator for enforcement and compliance at the Environmental Protection Agency, said in a statement to the press that “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.”

Significant Shares Drop

The breaking of this scandal came less than a week after President-elect Donald Trump praised the Fiat Chrysler company for its decision to invest more than $1 billion in US based investments, buildings its plants in Ohio and Michigan, rather than overseas as many of its competitors have chosen to do. However shares in the company fell by over 15% after news of the EPA’s investigation was announced: a significant shares drop in itself worth billions of dollars. (The stock has subsequently rebounded. Fiat Chrysler stock price  A sign that investors believe the Trump EPA will not enforce the law?)

We are yet to see how this will affect the company’s investment decisions, or how much they will have to pay -- if anything-- in compensation for their breaches of EPA policy once this investigation is complete.
But this is definitely a test case worth watching.                                                                              

References
“GUILTY! Volkswagen pays massive fine in cheater scandal, company officials indicted”, Clean Air Watchhttp://www.cleanairwatch.org/2017/01/guilty-volkswagen-pays-massive-fine-in.html
“Move Over, VW: Fiat Chrysler Now Caught In The Crosshairs Of The Clean Air Act”, After Market Newshttp://www.aftermarketnews.com/move-over-vw-fiat-chrysler-now-caught-in-the-crosshairs-of-the-clean-air-act/
Fiat Chrysler under investigation for Clean Air Act violations, Bank Ratehttp://www.bankrate.com/financing/cars/fiat-chrysler-under-investigation-for-clean-air-act-violations/#ixzz4W5sDwfdH
“Compare energy prices”, Quote Zonehttp://www.quotezone.co.uk/utilities/energy-prices.htm  
“Six things we learnt at the Detroit auto show”, Sci Tech Todayhttp://www.sci-tech-today.com/story.xhtml?story_id=101007IRRVUK
“Scientific Facts on Air Pollution Nitrogen Oxide”, Green Factshttp://www.greenfacts.org/en/nitrogen-dioxide-no2/
“Is Fiat Chrysler Automobiles about to have its own costly diesel emissions scandal?”, Fox Businesshttp://www.foxbusiness.com/markets/2017/01/12/is-fiat-chrysler-automobiles-about-to-have-its-own-costly-diesel-scandal.html
“Trump praises Fiat Chrysler and Ford for US Plant Investments, Bloomberghttps://www.bloomberg.com/politics/articles/2017-01-09/trump-praises-fiat-chrysler-and-ford-for-u-s-plant-investments

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