Toyota subsidiary Hino Motors agreed to plead guilty and pay more than $1.6 billion to resolve alleged emissions fraud with its heavy-duty diesel engines.
The U.S. government announced the settlement on Wednesday, stating that Hino submitted fraudulent engine emission and fuel consumption data to regulators, including the U.S. EPA and California.
The government said that Hino used the fraudulent data to secure approvals for and sell more than 105,000 diesel engines from 2010 to 2022.
The government said that EPA discovered the fraud as part of confirmatory testing of Hino’s engines. EPA estimated that Hino’s engine emitted more NOx, particulate matter, carbon dioxide, and nitrous oxide than regulations allow. The agency on January 10 voided engine approvals for Hino’s 2010-2019 diesel engines—the largest voiding action ever taken by EPA.
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“Hino knew the requirements that engines must meet to be certified to operate in the United States, yet it falsified data for years to skirt regulations,” said Todd Kim, assistant attorney general of the Justice Department’s Environment and Natural Resources Division. “Hino’s actions led to vast amounts of excess air pollution and were an egregious violation of our nation’s environmental, consumer protection and import laws.”
As part of the resolutions, Hino agrees to plead guilty to a multi-year criminal conspiracy, pay a criminal fine of $521.76 million, forfeit $1.087 billion related to the fraud, serve a probation against importing diesel engines, and implement a compliance program. The resolution is the second largest criminal fine in the history of EPA’s mobile source program. Some of these payments will go to Hino's implementation of an emissions mitigation program valued at $155 million and a recall program valued at $144.2 million for 2017-2019 heavy-duty truck engines. The subsidiary's payments will also fund $123.6 million for mitigation costs in California and pay $30.3 million to resolve California False Claims Act claims.
Hino issued a statement on the settlement after its announcement. The subsidiary said that it voluntarily disclosed the issues to U.S. authorities in 2019 and provided what the U.S. Department of Justice described as "exemplary" cooperation.
“This resolution is a significant milestone toward resolving legacy issues that we have worked hard to ensure are no longer a part of Hino’s operations or culture. We deeply apologize for the inconvenience caused to our customers and stakeholders," said Satoshi Ogiso, president and CEO of Hino Motors in the statement. "In order to prevent a recurrence of this kind of issue, we have implemented company-wide reforms, including meaningful improvements to our internal culture, oversight, and compliance practices."
