FCA Paid Big for Fuel Economy Penalties

A wave of reports indicates Fiat Chrysler Automobiles, which owns gas-guzzling brands like Dodge and Jeep, paid out an extra $77 million because it missed fuel economy standards in 2018. That’s a hefty fine for the automaker.

Long before Ford decided to start cancelling cars in North America, FCA let several of its more fuel-efficient lines like the Chrysler 200 and Dodge Avenger die. It’s been riding high on sales of muscle cars and SUVs, but there’s obviously a price for that strategy.

This big penalty was for the 2016 model year. No other automaker was assessed a fee by the U.S. government. It’s also the largest fine under CAFE fuel economy standards in at least five years, but that may change. As automakers are selling big trucks and SUVs to meet market demand, more of these penalties could be coming.

This is exactly why numerous automakers have been lobbying the White House to repeal or roll back some or all CAFE standards. They argue when the standards were put in place in 2012 the market was trending to smaller vehicles, thanks to high gas prices. Now that gas is cheap, consumers want bigger rides. This is controversial, but it’s easy to see why automakers are panicking about future fines.