EPA finds Hyundai, Kia overstated gas mileage

Hyundai and Kia, Korea's two biggest automakers, overstated the gas mileage on 900,000 vehicles sold in the past three years, a discovery that could bring sanctions from the U.S. government and millions of dollars in reimbursements to car owners.

The inflated mileage was uncovered in an audit of test results by the Environmental Protection Agency, which ordered the Korean automakers to replace fuel economy stickers on the affected cars. The new window stickers will have figures that are one-to-six miles per gallon lower depending on the model, the agency said Friday. 

"Consumers rely on the window sticker to help make informed choices about the cars they buy," said Gina McCarthy, assistant administrator of the EPA's air-quality office. "EPA's investigation will help protect consumers and ensure a level playing field among automakers." 

The EPA's inquiry into the overstated figures is continuing, and the agency would not comment when asked if the companies will be fined or if a criminal investigation is under way.

But the agency said it's the first case in which erroneous test results were uncovered in such a large number of vehicles from the same manufacturer. Only two similar cases have been discovered since 2000, and those involved single models.

Hyundai and Kia executives said the higher figures were unintentional errors. They apologized and promised to pay owners of the 900,000 cars and SUVs for the difference in mileage. The payments, which will be made annually for as long as people own their cars, are likely to cost the companies hundreds of millions of dollars.

The EPA's findings come at a bad time for Hyundai and Kia, which have seen explosive sales growth in the U.S. partly because of advertising campaigns that touted gas mileage. Hyundai even poked fun at competitors who promoted special high-mileage versions of their cars, claiming that its cars had high mileage across the model lineup.

The EPA said it began looking at Hyundai and Kia when it received a dozen complaints from consumers that the mileage of their 2012 Hyundai Elantra cars fell short of numbers on the window stickers. Staffers at the EPA's vehicle and fuel emission laboratory in Ann Arbor, Mich., included the Elantra in an annual fuel economy audit.

The audit turned up discrepancies between agency test results and data turned in by Hyundai and Kia, the EPA said. As a result, the two automakers will have to knock one or two miles per gallon off the mileage posted on the window stickers of most of their models. Some models will lose three or four miles per gallon, and the Kia Soul, a funky-looking boxy small SUV, will lose six mpg from the highway mileage on its stickers.

The errors involve 13 models from the 2011 through 2013 model years, including seven Hyundais and six Kias. Window stickers will have to be changed on some versions of the following models: Hyundai's Elantra, Sonata Hybrid, Accent, Azera, Genesis, Tucson, Veloster and Santa Fe. Kia models affected include the Sorrento, Rio, Soul, Sportage and Optima Hybrid.

Michael Sprague, executive vice president of marketing for Kia Motors America, said the companies have a program in place to reimburse customers for the difference between the mileage on the window stickers and the numbers from the EPA tests.

If all 900,000 owners get cards for $88.03, it would cost the automakers more than $79 million a year. (AP)