Fiat Chrysler Automobiles Swears its Diesels Aren't Dirty, Accuses EPA of 'Belligerent' Stance

FCA boss Sergio Marchionne "really pissed off" at the EPA accusations of cheating.

Daniel Acker/Bloomberg/Getty Images

Thank Volkswagen and its $20 billion emissions scandal for making “diesel” the dirtiest word in automobiles. But to the Environmental Protection Agency, there might be one thing worse: “Defeat Device,” an elocution so foul that Fiat Chrysler Automobiles would rather you wash your mouth—or exhaust pipe—with soap for daring to say it.

The EPA accused FCA of illegally installing software on 104,000 Jeep Grand Cherokees and Dodge Ram pickups that would disguise excess pollution emitted by its 3.0-liter diesel V-6 engine. As with VW, the focus of the EPA—and the powerful California Air Resources Board, which issued its own violation—is on smog-forming nitrogen oxides that are the bane of diesel engines. But as FCA takes VW’s place in the regulatory crosshairs, the company insists the software is no VW-style defeat device. Still, just the sound of that nasty double-“D” word in polite corporate company sent FCA stock prices tumbling.

In case your mother has been covering your ears, a defeat device refers to software that VW secretly installed on its diesel models and conspired to hide from regulators. The software recognized when a car was undergoing emissions testing, and only then cranked up pollution controls to game the test. On actual roads, VW’s were spewing nitrogen oxides at up to 40 times the allowable levels.

The odd part, to me: Unlike the go-it-alone VW diesels, the 2014, 2015, and 2016 Jeeps and Rams were fully girded with so-called Selective Catalytic Reduction (SCR) systems. That’s the technology used by every diesel-maker here save VW, including Jaguar and Land Rover’s new Ingenium diesels. These models carry several gallons of urea-based Diesel Emissions Fluid, available at any Pep Boys, that’s introduced into the exhaust stream to neutralize pollution. That SCR technology should allow the FCA diesels to pass emissions tests; unless, as the EPA seems to allege, the Jeeps and Rams are somehow bypassing the controls.

The EPA says that FCA failed to disclose or certify eight pieces of engine-control software on these diesels, though it has yet to charge the company with intentionally violating the law. Perhaps—and this is only an educated guess—we’re looking at some issue with cold-start conditions. It’s a relatively short operating period, but one for which human engineers, engines, and software all struggle to bring the engine smoothly up to operating temperature, yet also “light up” catalysts and keep emissions in check.

Either way, FCA reacted with unusual public frustration. As reported by Reuters’ David Shepherdson, Fiat Chrysler Chief Executive Sergio Marchionne angrily rejected the EPA’s allegations.

"I'm really pissed off" about reports that equate FCA's issues with VW's, Marchionne said, emphasizing that the software was never designed to circumvent emissions rules by detecting when the vehicle was undergoing testing. Instead, Marchionne suggested the EPA was aggrieved that FCA had not fully disclosed software that protects the engine.

"The way that it has been described, I think, has been unfair to FCA, and that is the thing that disturbs me most," Marchionne said. He accused the EPA of taking a “belligerent” stance toward automakers, and insisted that nothing FCA did approached the level of lawbreaking.

A company insider told me that the FCA felt blindsided by the agency’s action. Affirming a company statement, the insider said FCA has been working with the agency for months to “explain its emissions control technology” and to propose software changes to improve emissions performance. That last part begs the question of why, if FCA’s current emissions controls are meeting federal standards, the company would need to change or improve anything—aside from, perhaps, placating regulators.

The executive said that it had heard nothing but “crickets” from the EPA over their proposals, with an EPA official saying they were busy dealing with the VW scandal. The Chrysler executive added that, if and when the EPA approves software updates, a voluntary recall would alert owners to bring their vehicles in for a fix.

Interestingly, the man who might have prevented the VW scandal was once the second-highest-ranking executive at Chrysler when it was part of Daimler and Mercedes. I vividly remember the high-profile Wolfgang Bernhard, dressed in Terminator-style leather, riding the Viper-powered Tomahawk motorcycle onto a Detroit Auto Show stage when he was Chrysler’s president in 2003. Three years later, during his brief run as head of the Volkswagen brand, Bernhard announced a deal for VW to adopt the urea-based Bluetec diesel technology that Mercedes and Bosch had developed. Shortly thereafter, Bernhard was deposed in a corporate putsch as Martin Winterkorn assumed the presidency of VW. Ironically, it was Winterkorn who was forced to resign in the wake of the VW emissions scandal (and we still don’t know what he knew and when he knew it). But it's clear that, from Winterkorn on down, VW’s hubris and desire to boost lagging sales in America led it to cut corners by selling diesels without a Bluetec-type system. That decision ultimately led VW to install diesel-cheating software when it realized it couldn’t meet emissions rules. That fateful decision has now cost the company at least $20 billion, with ongoing ripple effects from executive arrests to lost sales and a tarnished reputation.

Certainly, whatever happens with Chrysler, we’re talking a relative handful of vehicles, allowing them to isolate and limit the damage in a way that VW could not. And FCA's regulatory brouhaha will soon be fobbed off on a new Donald Trump administration. That includes the prospect of a more-sympathetic ear from Scott Pruitt, the nominee to run the EPA and former Oklahoma attorney general who once sued the agency for its bid to strengthen regulation of power plants. FCA must be counting the days until Jan. 20.

Yet aside from the potential toll on the company and its customers, there’s a bigger shame here: Diesel technology can be good technology. It can conserve petroleum, boost mileage, save consumers money and, yes, improve the environment—especially by reducing carbon-dioxide emissions to levels on par with hybrids. But right now, most people aren’t thinking “Toyota Prius” when they hear the word “diesel.” They’re thinking words like “dirty,” and “lemon.” Just don’t say “defeat device,” especially in earshot of Sergio Marchionne.