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First class-action suit filed over inflated fuel economy

Some 1,700 buyers sue 2 Korean, 4 foreign carmakers

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Published : 2014-07-07 21:10
Updated : 2014-07-07 21:40

Six carmakers, including two Korean and four foreign companies, have been hit with an unprecedented class-action lawsuit here for making bogus fuel-economy claims on their top-selling models.

A group of 1,785 car owners filed a lawsuit with the Seoul Central District Court on Monday, seeking between 1.5 million won and 3 million won ($1,490-$2,960) each in compensation over the false gas mileage claims.

Of them, 1,517 people ― or about 85 percent ― were owners of Hyundai Motor’s Santa Fe sport utility vehicle, while 234 were owners of Ssangyong Motor’s Korando Sports. 

Four of the foreign models are the Audi A4 2.0 TDI, Volkswagen Tiguan 2.0 TDI, Chrysler Jeep Grand Cherokee and BMW Mini Cooper Countryman.

“These companies misled consumers into purchasing vehicles of a different quality and paying higher fuel costs than promised,” said Kim Woong, a lawyer with law firm Yeyul representing the plaintiffs.

“They were engaged in fraud, false advertising and a breach of warranty.”

According to Kim, Some 3,000 consumers expressed their intention to file a lawsuit and the first batch of the complaints was filed as related documents were ready.

“We will continue to collect complaints by the Aug. 24 deadline and file additional lawsuits,” he added.

In February, a group of consumers had launched a lawsuit against Hyundai over the mileage overstatement. But the court denied the claim at the time.

The new lawsuit was prompted by recent government tests that found discrepancies between the stated and actual fuel economy ratings of the six car models.

On June 26, the Ministry of Land, Infrastructure and Transport decided to impose 1 billion won and 200 million won in fines on Hyundai and Ssangyong, respectively, for reporting inaccurate fuel ratings on their two SUV models.

On the same day, the Ministry of Trade, Industry and Energy confirmed that the discrepancies between the stated and actual gas mileages of the two Korean cars were within the legally allowable level of 5 percent.

But the Industry Ministry said it will sanction four foreign cars for overstating fuel ratings. Based on their car sales, each carmaker is expected to face fines worth 3 to 4 million won.

The different test results spared much controversy among carmakers even though the government later decided that the Transport Ministry should take the initiative on related vehicle tests in the future.

“We will explain our position fully in court,” a Hyundai official said of the new class-action suit.

By Lee Ji-yoon (jylee@heraldcorp.com)

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