U.S. EPA Announces $1.6 Billion Settlement With Toyota’s Hino Motors Over Diesel Emissions Fraud

Toyota Motor Corporation subsidiary Hino Motors on Jan.15, reached resolutions valued at more than $1.6 billion with U.S. regulators including the U.S. Environmental Protection Agency for violations related to submitting false and fraudulent engine emission testing and fuel consumption data as well as illicit smuggling of engines into the U.S. Hino secured approvals through unlawful conduct to import and sell, and cause to be imported and sold, over 110,000 diesel engines in the U.S. from 2010-2022. These engines were mainly installed in heavy-duty trucks. The criminal and civil resolutions are subject to approval by the U.S. District Court for the Eastern District of Michigan.

The violations facilitated Hino Motors to falsely obtain certificates of conformity for its diesel engines and approvals to import and sell vehicles. On Jan. 10, the EPA voided the certificates for Hino’s diesel engines manufactured between 2010 and 2019. This action represents the largest voiding of certifications the agency has performed in its certification program, which is designed to provide a level playing field for vehicle and engine manufacturers seeking to do business in the U.S.

Under the plea agreement, Hino Motors agreed to pay a criminal fine of $521.76 million, enter a probationary period of five years during which the company is prohibited from importing any of its diesel engines to the U.S., perform a comprehensive compliance and ethics program, and a $155 million mitigation program to compensate for excess emissions from its violations.

The mitigation program will aim to decrease at least 41,941 tons of nitrogen oxide emissions, 376 tons of particulate matter, 6,199 tons of carbon dioxide, and 135 tons of nitrous oxide. The reduction of nitrogen oxide emissions will translate to eliminating more than 110,000 heavy-duty trucks from roads.

Under mitigation measures, the company will also replace over 35 older, dirtier marine and locomotive engines with engines compliant with EPA’s diesel emissions standards. Hino will also install idle reduction technology in more than 135 locomotives.

The settlement also makes provisions regarding Hino’s violations of Californian environmental laws. Hino Motors agreed to conduct a recall program of $144.2 million to modify engines fitted in heavy-duty trucks between 2017 and 2019 to ensure compliance with the state’s emissions laws. The company will also spend $123.6 million towards mitigation projects and enforcement costs in California, and $30.3 million to resolve California False Claims Act claims.