Cummins agrees to pay record $1.67 billion penalty for modified engines that created excess emissions

[Democrats Stab Donors In The Back Again]

Cummins Inc. has agreed to pay an over $1.67 billion penalty to
settle claims by regulators that the engine manufacturer unlawfully
altered hundreds of thousands of pickup truck engines to bypass
emissions tests.

According to the U.S. Justice Department, which announced the
agreement in principle Thursday, Cummins' alleged actions violated
the Clear Air Act — a federal law that requires car and engine
manufacturers to comply with emission limits.

The $1.675 billion fine would be the largest civil penalty the
Justice Department has secured under the Clear Air Act to date and
second largest environmental penalty ever secured.

The Justice Department accuses Cummins of installing defeat devices
—d which can bypass or defeat emissions controls — on 630,000 2013-
2019 Ram 2500 and 3500 pickup truck engines, as well as undisclosed
auxiliary emission control devices on 330,000 2019-2023 Ram 2500 and
3500 pickup truck engines.

"The types of devices we allege that Cummins installed in its
engines to cheat federal environmental laws have a significant and
harmful impact on people's health and safety," Attorney General
Merrick B. Garland said in a prepared statement. "Our preliminary
estimates suggest that defeat devices on some Cummins engines have
caused them to produce thousands of tons of excess emissions of
nitrogen oxides."

Garland pointed to the "cascading effect" of these pollutants,
notably breathing issues and respiratory infections that can arise
with long-term exposure.

In a Friday release about the agreement, Cummins said it does not
admit any wrongdoing, noting the company "has seen no evidence that
anyone acted in bad faith."

Cummins added that it "cooperated fully" with regulators. The
company also pointed to actions dating back to 2019, including a
previous recall of 2019 Ram 2500 and 3500 trucks and a now-initiated
recall of 2013-2018 Ram 2500 and 3500 trucks.

Cummins said it previously accrued $59 million in estimated costs
for these and other related recalls. The company expects an
additional charge of about $2.4 billion in 2023's fourth quarter "to
resolve these and other related matters involving approximately one
million pick-up truck applications in the United States."

Cummins' agreement in principle is with the U.S. and State of
California. The settlement is subject to final approvals.

Shares for Cummins Inc. were down about 3% Friday morning. Last
month, the engine maker, based in Columbus, Indiana, reported
third-quarter net income of $656 million on revenue of $8.4 billion.

Stellantis, maker of Ram vehicles, did not comment Friday.