Engine manufacturer Cummins has agreed to a landmark $2 billion settlement over emissions cheating devices installed in nearly 600,000 Dodge Ram pickup trucks equipped with Cummins diesel engines. The deal between Cummins, the U.S. Department of Justice (DOJ), the Environmental Protection Agency (EPA), and the California Air Resources Board (CARB) will require Cummins to repair or replace the affected vehicles and marks the largest civil penalty ever imposed under the federal Clean Air Act.
Key Details of the Settlement
Under the terms of the agreement, Cummins will be required to:
- Pay civil penalties totaling $1.68 billion to resolve state and federal allegations that it violated clean air regulations
- Repair or replace the emissions after-treatment systems in approximately 590,000 model year 2014-2020 Ram 1500 and 2500 trucks with Cummins engines
- Extend warranties on critical emissions components in the affected vehicles for 10 years or 150,000 miles
The settlement comes after a joint DOJ-EPA investigation found that Cummins had installed emissions defeat devices and illegal software designed to circumvent emissions testing. These devices allowed the Ram trucks to emit far more nitrogen oxide (NOx) pollution on the road than under test conditions.
California Attorney General Rob Bonta said the settlement will provide more than $72 million in funds specifically for projects to improve air quality in communities most impacted by air pollution.
“Cummins carelessly gambled with the health of Californians, especially those who live in neighborhoods already overburdened by pollution, to boost its bottom line,” said Bonta.
Timeline of the Emissions Scandal
The use of emissions cheating software by automakers and suppliers first came to light in 2015, when Volkswagen admitted to secretly installing defeat devices in nearly 600,000 diesel vehicles. Since then, other manufacturers including Fiat Chrysler and Daimler have faced penalties related to diesel emissions violations.
The DOJ first filed suit against Cummins over the Dodge Ram diesel emissions issue in 2021. Prosecutors allege that Cummins was aware of potential issues with meeting NOx emissions standards as early as 2010 but failed to take appropriate action. Internal documents suggested Cummins managers rejected proposals for larger exhaust gas recirculation systems and selective catalytic reduction systems that could have kept NOx emissions within legal limits.
Record $2 Billion Settlement Amount
The previous record settlement for violation of U.S. emissions standards was a $1.5 billion deal reached between Volkswagen, federal regulators, and California in 2016.
While the Volkswagen case involved a larger number of vehicles (nearly 600,000), the higher per-vehicle cost of the Cummins settlement reflects the extended length of the violations and involvement of both the EPA and California regulators, according to experts.
The settlement comes at a difficult time for Cummins, which has seen declining demand for diesel engines in key markets. The company’s stock price fell nearly 7% on news of the agreement.
What’s Next for Consumers and Cummins
Owners of the affected Dodge Ram pickup trucks will be notified by Cummins when repair or replacement parts become available, likely beginning in 2025. Completing the retrofits and warranty extensions called for under the settlement will take 5-7 years to complete.
Meanwhile, Cummins says it will continue appealing portions of the DOJ lawsuit related to penalties and timelines. But consumer advocates say the company has little leverage given the clear-cut nature of the clean air violations.
Going forward, tougher oversight and stiffer penalties mean automakers and suppliers will find it increasingly difficult to employ emissions test cheating for competitive gain at the expense of public health and the environment.
“This settlement sends an unmistakable message to companies that scheme to defeat emissions tests,” said EPA Administrator Michael Regan. “Now is the time to move forward toward a zero-emissions transportation future.”
Impact on Communities and Moving to Zero Emissions
Elevated NOx emissions from diesel vehicles disproportionately impact disadvantaged communities already overburdened by air pollution. Part of the settlement money will go toward improving air quality in these neighborhoods.
But some environmental groups say fines alone won’t remedy the harm caused by excessive diesel pollution over many years. The focus needs to be on transitioning commercial trucks and other diesel-powered vehicles to zero-emission electric models.
“Fines don’t give children back their lung function,” said Katherine Garcia of the Sierra Club. “The only solution is to strictly enforce emissions standards now while ramping up investments in clean transportation.”
Table: Largest Clean Air Act Civil Settlements
|~590,000 Dodge Ram Pickup Trucks
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