Fiat Chrysler seeks diesel emission certification from EPA

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Although Fiat Chrysler is unlikely to have to pay as much as Volkswagen, the emissions cheating, if proved, could still be expensive and badly damage the company's reputation at a time when it is grappling with low profitability.

Fiat Chrysler (FCA), attempting to reach a settlement with U.S. regulators following studies that show the automaker installed emissions-cheating software, has said that it will modify around 100,000 diesel vehicles.

On Friday, Fiat Chrysler said it was modifying Jeep Grand Cherokees and Ram 1500 diesel vehicles in the 2014 through 2016 model years with "updated emissions software calibrations". But FCA says any litigation would be "counterproductive" to its talks with the EPA.

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"FCA US also believes that these actions should help facilitate a prompt resolution to ongoing discussions with the Environment and Natural Resources Division of the U.S. Department of Justice and other governmental agencies", the automaker said in a statement.

FCA shares fell 1 percent to $10.44 in midday trading. Automakers can legally use emission control devices to deactivate a vehicle's emission control system in certain conditions, but regulators require the disclosures when companies apply for certificates that are required to sell cars in the U.S.

FCA said it has updated the faulty software that the EPA said affected 104,000 Grand Cherokee SUVs and Ram pickups for model years 2014-16.

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FCA's diesels have also been the subject of attention in Europe. On Wednesday, the European Union's executive arm filed a formal complaint against the Italian government for allowing Fiat Chrysler to sell cars created to evade emissions tests.

US regulators have put greater scrutiny on diesel models after Volkswagen AG admitted in 2015 to using defeat devices that turned on emissions controls to pass tests but turned them off during driving. Gasoline versions of both models are now on sale, but the diesels (or any auto, for that matter) can't be sold in the USA without emissions certification, and it's unclear how long the EPA will take to approve or reject FCA's application. Eventually the German automaker paid more than $22 billion in legal settlements and fines stemming from the cheating.

"FCA US expects that following EPA and CARB approval, owners of the 2014-2016 MY vehicles will be able to receive the software updates at their dealerships", the company said. The brand has been involved closely with the EPA and CARB to clarify exactly how its emissions control software works and has developed a fix it thinks will be satisfactory.

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