Chrysler rejects French diesel test-manipulation claims

[MILAN] Fiat Chrysler Automobiles NV denied a report that the carmaker could be fined for manipulating French diesel-emissions tests, saying the allegations have no basis and that its vehicles comply with the law.

The Italian company hasn't been charged with any offense and is cooperating with French authorities, Fiat Chrysler said in an emailed statement.

French newspaper Le Monde reported Monday that the potential levy appears in a report from France's anti-fraud office, the Directorate General for Competition and Repression of Fraud. France opened an emissions probe in March that also includes Peugeot SA, Renault SA and Volkswagen AG.

French authorities are investigating the carmaker for what's called aggravated fraud, a charge that can result in a maximum fine of 10 per cent of global revenue, or as much as 9.62 billion euros (S$15.4 billion), details Le Monde reported Monday and in a previous article on Oct 23. Vehicles being examined have generated about 152 million euros revenue in the country from 2014 to 2016, the newspaper said.

Fiat Chrysler "looks forward to the opportunity to respond to these claims should they be made and to demonstrate its diesel vehicles comply with applicable emissions requirements," the company said. The French anti-fraud office declined to comment on the Le Monde report.

Regulators in Europe and the U.S. have put diesel models under greater scrutiny after Volkswagen admitted in 2015 to using defeat devices that turned off emissions controls during driving. Fiat Chrysler was sued in May by the US Justice Department over claims its diesel-powered pickups and SUVs were outfitted with illegal software.

In May, the European Commission opened an infringement procedure against Italy for "failure to fulfill its obligations" in how it tests Fiat Chrysler vehicles, after German authorities escalated to the EU a dispute with Italy over whether the carmaker's vehicles breached emissions rules.

Under EU rules, Italy is responsible for certifying Fiat cars because the automaker's regional operations are based in the country. The EU asked Italy to respond to concerns that Fiat Chrysler hadn't sufficiently justified the necessity of a "defeat device" that turns off emissions controls outside of the test cycle. Such devices are banned, but can be exempted if they are required for safety or to protect the engine from damage.

Italy has strongly backed Fiat's case in Europe. The Italian Transport Ministry's tests carried out after the VW scandal showed Fiat used no unauthorized devices on its vehicles.

Italian Transportation Minister Graziano Delrio told Il Corriere della Sera in May that the Fiat case was completely different than Volkswagen's and that the Fiat devices were there to protect engines.

The industry's credibility has been strained by the VW episode. Since the German carmaker admitted to rigging its tests, Mitsubishi Motors Corp. has acknowledged that it manipulated fuel-economy tests, and Daimler AG is checking for possible irregularities in its vehicle certifications at the behest of the US. Justice Department.

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