Toyota to Settle Emissions Fraud Charges For $1.6Bn

Toyota Motors’ trucking unit has agreed to plead guilty to criminal charges and pay $1.6 billion in civil and criminal penalties for fraudulently concealing excess emissions from diesel engines sold in the United States, the Environmental Protection Agency said.

For more than a decade, Hino Motors, a Toyota subsidiary, submitted false testing data to meet pollution requirements and win approval to install diesel engines in heavy trucks, the E.P.A. said. Data submitted by Hino also exaggerated the vehicles’ fuel economy, the agency said.

The criminal portion of the fine, $522 million, is the largest in an emissions case since Volkswagen agreed in 2016 to pay civil and criminal penalties totaling $15 billion to settle accusations it hid excess emissions from diesel cars it sold in the United States. The size of the penalties in the Hino case reflects “the egregiousness of the conduct and the flagrant disregard for the E.P.A.’s certification program,” the agency said.

California, which has stricter emissions requirements than the federal government, will receive $237 million as part of a settlement.

The E.P.A. does not have the resources to test every vehicle sold in the United States and relies on manufacturers to provide emissions data for their products. Hino’s violations were discovered after the agency conducted its own checks, the agency said.

In a statement, the company said: “Hino voluntarily disclosed these issues to U.S. authorities in 2019 and has provided what the U.S. Department of Justice has called ‘exemplary’ cooperation with the D.O.J.’s investigation. The agreements resolve all of the company’s outstanding legal issues in the United States related to its legacy emissions issues.”

Diesel engines produce large amounts of nitrogen oxides, which are linked to asthma, cardiovascular problems and other serious ailments, and contribute to climate change. Automakers use technology to control the pollution, but adding it to engines makes vehicles more expensive and can affect their performance. Several automakers have been caught cheating.

Hino’s misconduct involved 110,000 motors that were imported and installed in trucks that the company sold in the United States from 2010 to 2022, the E.P.A. said. As part of a settlement, which must be approved by a federal judge, Hino will be barred from importing diesel engines to the United States for five years. It will also recall motors in trucks from the 2017 to 2019 model years and make modifications to bring them into compliance with emissions regulations.

Hino also agreed to improve its internal controls to prevent future misconduct. And the company will finance programs designed to compensate for the excess pollution from its engines that, for example, will replace older diesel engines in 35 ships and train locomotives with cleaner motors.

The resulting reduction in pollution will be the equivalent of taking 110,000 trucks off the road, the E.P.A. said.