(Refiles to fix coding issue)
* Santa Fe's mileage is 8 pct lower than stated -transport
* Buyers may seek compensation through courts
* Industry ministry to fine BMW, Volkswagen, Audi, Chrysler
for false ratings
SEOUL, June 26 South Korea will fine Hyundai
Motor around 1 billion won ($1 million) for
overstating the fuel economy of its Santa Fe sport utility
vehicle, almost two years after authorities in the United States
uncovered the same issue.
The relatively small fine announced on Thursday by the
transport ministry, which conducted tests on 14 vehicles after
Hyundai's U.S. mileage fiasco, comes as South Korea's biggest
automaker struggles to defend its dominant market share at home
as imported cars surge in popularity.
"The fine is a slap on the wrist... but it will affect
Hyundai's reputation at home for sure and further stimulate
demand for imported cars, which offer higher fuel-efficiency,"
said Nam S Lee, a business professor at Choong-ang University.
While the fine would be tiny for Hyundai Motor, South Korean
car owners may seek legal compensation for additional fuel
costs. Three Santa Fe owners on Tuesday filed a complaint to a
court in Seoul, each demanding 600,000 won in compensation.
But potentially complicating the efforts of Santa Fe owners
seeking compensation, South Korea's industry ministry said on
Thursday that its own tests showed the Santa Fe's fuel economy
was not overstated.
The ministry had long tested and verified the fuel economy
of passenger vehicles before the transport ministry, which
stepped in after the U.S. lawsuits.
"We regret that we were not able to announce unified test
results for the same vehicles," the government said in a
statement on Thursday.
The government said the difference came from different
testing methods and standards, and that only the transport
ministry will be authorised to test and verify the fuel economy
of vehicles in the future to reduce confusion.
The industry ministry also found that the Audi A4
2.0 TDI, Volkswagen Tiguan 2.0 TDI, Chrysler
Jeep Grand Cherokee and BMW MINI Cooper
Countryman had false mileage ratings. The industry ministry said
the carmakers would be fined up to 4 million won ($3,900) each.
The transport ministry tested the fuel economy of 14
vehicles including imported models sold in South Korea after
Hyundai and Kia said in 2012 that they overstated
the fuel economy of about 900,000 vehicles in the U.S.,
including the Santa Fe.
The admission was followed by a series of customer lawsuits
in the U.S., which led to a settlement proposal of up to $395
million for Hyundai and Kia late last year.
The transport ministry said on Thursday that its tests
showed the Santa Fe's fuel economy was 8.3 percent lower than
the vehicle's stated figure, exceeding the acceptable margin of
error of 5 percent.
The reading applied to Santa Fe (DM) vehicles featuring 2.0
litre engines and two-wheel drive in production since May 2012.
An estimated 120,000 Santa Fes were affected, a ministry
But the industry ministry said the Santa Fe's mileages were
within the acceptable margin of error.
Hyundai said it is "very confused by the fine and the
different results announced by the related government ministries
regarding the fuel economy rating of our Santa Fe 2.0 Diesel 2WD
AT and regret the discrepancy."
"As the two government departments have reached different
conclusions, it is too early for us to decide what actions to
take," Hyundai said in its statement.
($1 = 1017.8000 South Korean Won)
(Reporting by Hyunjoo Jin; Editing by Christopher Cushing and