Cummins agrees to pay record $1.67 billion fine for modified engines that generated excess emissions

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Cummins Inc. agreed to pay a fine of more than $1.67 billion to resolve regulators' claims that the engine maker illegally altered hundreds of thousands of truck engines to evade emissions testing.

According to the United States Department of Justice, which announced the agreement in principle on ThursdayCummins' alleged actions violated the Clean Air Act, a federal law that requires auto and engine manufacturers to comply with emissions limits.

The $1.675 million fine would be the largest civil penalty the Justice Department has ever obtained under the clean air law to date and the second largest environmental penalty ever imposed.

The Department of Justice accuses Cummins to install defeat devices, which can bypass or defeat emissions controls, on 630,000 2013-2019 Ram 2500 and 3500 truck engines, as well as undisclosed auxiliary emissions control devices on 330,000 2019- Ram 2500 and 3500 truck engines 2023.

“The types of devices we allege Cummins installed in its engines to circumvent federal environmental laws have a significant and harmful impact on people's health and safety,” Attorney General Merrick B. Garland said in a prepared statement. “Our preliminary estimates suggest that defeat devices on some Cummins engines have caused them to produce thousands of tons of excessive nitrogen oxide emissions.”

Garland noted the “cascading effect” of these contaminants, particularly respiratory problems and respiratory infections that can arise with prolonged exposure.

In a statement Friday about the settlement, Cummins said it admits no wrongdoing and noted that the company has “seen no evidence that anyone acted in bad faith.”

Cummins added that it “cooperated fully” with regulators. The company also noted actions dating back to 2019, including an earlier 2019 Ram 2500 and 3500 truck recall and a withdrawal now started from 2013-2018 Ram 2500 and 3500 trucks.

Cummins said it previously accrued $59 million in estimated costs for these and other related recalls. The company expects an additional charge of about $2.4 billion in the fourth quarter of 2023 “to resolve these and other related matters involving approximately one million pickup truck applications in the United States.”

Cummins' agreement in principle is with the US and the State of California. The agreement is subject to final approvals.

Shares of Cummins Inc. fell about 3% on Friday morning. Last month, the Columbus, Indiana-based engine maker reported third-quarter net income of $656 million on revenue of $8.4 billion.

stellantisVehicle maker Ram had no comment Friday.



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