Hyundai, Kia agree to $70M settlement in Canadian fuel efficiency class action

MARKHAM, Ont.—Hyundai Auto Canada Corp. and its affiliate, Kia Canada Inc., have reached settlements with a combined valued of almost $70-million in class action suits involving the fuel economy ratings of some of their vehicles.

The deal offers lump sum payments and other options to current and former owners and lessees of some 130,000 model year 2011 to 2013 Hyundai vehicles and some 41,000 Kia vehicles from the same model years.

The value of the Hyundai settlement is up to $46.65-million, while the Kia deal is worth up to $23-million, the companies said.

Those who don’t take the one-time payments can remain in an existing reimbursement both Hyundai and Kia introduced after restating the fuel economy ratings of their vehicles in November 2012.

At the time, Hyundai’s previously advertised fuel consumption figures for combined city/highway driving were increased by between 0.2 and 0.8 of a litre per 100 kilometres.

Figures for Kia were not immediately available.

Michael Peerless of Siskinds LLP, the lead plaintiff lawyer involved in the settlement, praised the decision to settle.

“Hyundai should be commended for doing the right thing and resolving this issue with its customers,” Peerless is quoted in a statement issued by Hyundai.

“The fact that a class member is able to choose one of a variety of lump sum payments, or to remain in the reimbursement program, provides real benefits to this large class of customers.”

At the time of the restatement, Hyundai and Kia both provided a reimbursement program to cover the additional fuel costs associated with the rating change—plus a 15 per cent premium in acknowledgment of the inconvenience to customers—for as long as they owned or leased an affected vehicle.

Affected owners and lessees are compensated based on their actual kilometres driven and the fuel costs for the region in which they live.

“While customers have responded favourably to the original reimbursement program, today’s settlement is designed to provide them with an additional compensation option, again intended to make customers fully whole for Hyundai’s fuel economy ratings restatement,” said Faithlyn Hemmings, senior legal counsel at Hyundai Canada.

Under the terms of the proposed settlement, a lump sum payment will be provided as an option to the reimbursement program.

While the agreements are valued at up to $46.65-million and $23-million, respectively, in cash compensation plus other available options, the actual figure will depend on what options customers choose to take.

The lump sum payments will vary by type of vehicle and will be reduced for any amounts already received through the existing reimbursement programs.

For example, an individual owner who purchased a new 2012 Hyundai Elantra would receive a lump sum payment of $361, minus any previous reimbursement payments.

Both offers also allow drivers may also select other options, such as a dealership credit of 150 per cent of the lump sum cash payment amount or a credit of 200 per cent of the cash amount toward the purchase of a new vehicle.

Courts in Ontario and Quebec are expected to review the agreement for approval later this year.