US regulator to investigate “timeliness and scope” of Hyundai and Kia car recalls
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A US safety regulator is opening a probe into the recall of nearly 1.7 million cars, following the leaking of internal documents by a whistleblower, revealing an engine design flaw and other faults.
Kim Gwang-ho, formerly an engineer for Hyundai Motor Co, flew to Washington in August last year to warn the US National Highway Traffic Safety Administration (NHTSA) that three recalls affecting 1.7 million cars in the US may not have been sufficient.
Mr Kim shared hundreds of pages of internal documents with the regulator, which allegedly detailed a serious defect with the Theta II engine – installed in more than 20 different Hyundai and Kia models – among other faults. He argued that the engine problem was not just related to the manufacturing process, but also to the engine design, meaning that manufacturers would be required to fix engines in all affected cars.
Hyundai has denied Mr Kim’s allegations.
In 2015, Hyundai recalled 470,000 US Sonata sedans, warning that engine failure could result in the vehicles stalling with an increased risk of road accidents. Kia Motor Co – an affiliate of Hyundai – did not join Hyundai at this time in recalling vehicles installed with Theta II engines.
Hyundai blamed the engine fault on manufacturing problems, saying that metallic debris had been left around the engine’s crankshaft, interfering with oil flow and damaging components.
More recently, Hyundai expanded its US recall to 572,000 Sonata and Santa Fe Sport vehicles with the Theta II engine, whilst Kia recalled 618,000 Optima, Sorento and Sportage vehicles affected with the same engine fault. The recall was also conducted in Canada and South Korea, costing the companies 360 billion won (£248 million) overall.
Earlier this month, the South Korean transport ministry demanded that Hyundai and Kia recall a further 240,000 cars, following Kim’s revelations of numerous defects which could compromise safety.
According to a filing published recently, the NHTSA may impose a fine on the Korean car manufacturers if they decide that the “timeliness and scope” of the Theta II engine recalls and the companies’ “compliance with reporting requirements” were inadequate.
Hyundai previously ran into trouble with the US safety regulator in 2014, when it was fined $17.35 million (£13.37 million) over the delayed recall of 43,500 Genesis cars due to a brake defect linked to two injuries. After this incident, the NHTSA warned that Hyundai “must change the way they deal with safety-related defects”. The manufacturer promised to improve its handling of safety issues.
Since the incident, the US Congress has voted to raise the maximum fine for a car manufacturer over a delayed recall to $105 million (£80 million).
A spokesperson for Hyundai said that the company “has conducted recalls in compliance with US regulations and procedure” and will cooperate “sincerely” with the newest investigation.