HCEA – $47M Penalty

EPA and DOJ Reach Clean Air Settlement with Hyundai for Engines and Construction Equipment Illegally Imported and Sold in the United States

WASHINGTON (9/19/2019) Under a settlement with the U.S. Environmental Protection Agency (EPA) and U.S. Department of Justice, Hyundai Construction Equipment Americas Inc.(HCEA) and Hyundai Heavy Industries Co. Ltd (HHI) (collectively known as “Hyundai”) has agreed to pay a $47 million civil penalty for violating Title II of the Clean Air Act. The settlement resolves allegations that Hyundai sold heavy construction vehicles with diesel engines that were not certified to applicable emission standards.

From 2012 to 2015, Hyundai pre-purchased, or “stockpiled” engines that met outdated emissions standards and then illegally imported, marketed and sold heavy construction equipment with these engines installed, in violation of the Clean Air Act. Additionally, Hyundai imported, marketed and sold units of equipment in quantities that exceeded their exemption allowance limit under the Transition Program for Equipment Manufacturers (TPEM) program regulations. Defendants allegedly introduced into United States commerce at least 2,269 illegal diesel nonroad vehicles. Under the terms of the settlement, Hyundai has agreed to pay a $47 million civil penalty to resolve their Clean Air Act violations.

“EPA is holding Hyundai accountable for importing and selling diesel engines and heavy-duty construction vehicles that did not meet Clean Air Act emission standards,” said Susan P. Bodine, EPA Assistant Administrator for the Office of Enforcement and Compliance Assurance. “By ignoring regulatory requirements, Hyundai not only gained a market advantage over their competitors, but they also introduced higher polluting vehicles into the United States, undermining the protection of human health and the environment.”

“Hyundai put profits above the public’s health and the requirements of the law,” said Jeffrey Bossert Clark, Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division. “We will not tolerate such schemes that skirt the Clean Air Act, designed by Congress to improve air quality.”

In 2015, the EPA received a whistleblower tip reporting illegal importation of nonroad diesel equipment that did not meet applicable emission standards. Based upon the information received from the whistleblower, the EPA initiated both criminal and civil investigations. In the criminal proceeding, the court imposed a sentence of, among other things, a $1,950,000 criminal fine.

Hyundai’s illegal nonroad diesel vehicles were not certified as meeting applicable pollutant emission standards, including for nitrogen oxides (NOx) and particulate matter (PM). NOx is a reactive gas that contributes to the formation of PM and ozone. PM is a form of air pollution composed of microscopic solids and liquids suspended in air. Ozone is a highly reactive gas that is formed in the atmosphere, in part, from emissions of NOx. Exposure to ozone and PM is linked to a number of health effects as well as premature death. Children, older adults, people who are active outdoors (including outdoor workers), and people with heart or lung disease are particularly at risk for health effects related to ozone or PM exposure.

For more information on this case, visit: https://www.epa.gov/enforcement/hyundai-construction-vehicles-clean-air-act-settlement-information-sheet

Contact Information: EPA Press Office (press@epa.gov)

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