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Current customer reimbursement program

Kia America has entered into an agreement with the U.S. Environmental Protection Agency (EPA) and California Air Resources Board (CARB) relating to the voluntary fuel economy rating adjustments on certain model-year 2011-13 vehicles in the U.S. The agreement institutionalizes a number of fuel economy testing-process changes put in place since the rating adjustments were announced in 2012. It also resolves other ambiguities in the testing process as regulated by the EPA.

According to the agreement, Kia will forego 2.05 million greenhouse gas credits, which will result in the permanent reduction of 2.05 million tons of greenhouse gas emissions into the atmosphere. As part of the corrective actions, Kia will also pay a $43.2 million civil monetary penalty.

Why did Kia settle?

The agreement is a result of good-faith efforts among all parties to resolve issues. We are pleased to have this matter behind us, and our priority remains making things right for our customers through our fair and transparent reimbursement program.

Which Kia models were included in the settlement?

The agreement is related to the voluntary fuel economy rating adjustments for certain 2011-13 model-year vehicles in the U.S.

How was the penalty determined?

The amount of the penalty relates directly to the total number of 2011-13 model year Kia and Hyundai vehicles subject to the agreement.

How does this agreement affect Kia’s customer reimbursement program or the class-action legal settlement?

Kia’s comprehensive reimbursement program for vehicle owners affected by the fuel economy rating adjustment remains in effect and unchanged by the EPA agreement. The class action settlement has been approved by the Court and the settlement notice process will not be affected by this agreement with EPA.

What steps are being taken to ensure current and future Kia fuel economy ratings are accurate?

The agreement institutionalizes a number of fuel economy testing-process changes put in place since the rating adjustments were announced in 2012. It also resolves other ambiguities in the testing process as regulated by EPA.

Will your newest model ratings be listed in the EPA’s Fuel Economy Datafile and Guide?

We expect Kia model ratings will be included once the agreement is approved.

LITIGATION

Class Action Settlement

Kia, through a recent class action settlement, offered the option of a single lump sum cash payment for those customers who would rather not return to a dealership to have their mileage verified under the original lifetime reimbursement program. So, through either the one-time lump sum payment or original lifetime reimbursement program, customers had the option of being made fully whole for Kia's ratings restatement.

From late December 2014 through January 5, 2015, we mailed notices to class members to apprise them of the proposed settlement and the online claims submission process. The deadline for claim submission was July 6, 2015. Unfortunately, some appeals were filed in connection with the class action settlement forcing Kia to halt any settlement payments. In January 2018, the appellate court vacated the settlement and ruled that the parties must return to the district court to continue the settlement process. It is unclear when the settlement will be re-evaluated and, if appropriate, become final. For more information on the status of the class action settlement, visit www.KiaMPGClassSettlement.com.

What if I already received payment under Kia’s Reimbursement Program announced in November 2012 – how does that affect the lump sum payment options included in the proposed settlement?

If you already received payment under this Reimbursement Program, you may still be eligible for lump sum payment options included in the proposed settlement. Any cash payment amounts will be reduced for any amounts already received through the original reimbursement program.

What if I don’t want the lump sum payment options and instead wish to continue participating in Kia’s existing Reimbursement Program – can I still do that?

Yes – the proposed settlement agreement provides a choice between the lump sum payment options or participation in the existing reimbursement program.

Can I register now for the lump sum payment options through the www.KiaMPGinfo.com site?

This site only allows affected owners to register for first time and subsequent payments as part of Kia’s Reimbursement Program. The lump sum payment option can only be obtained by making a claim at the class action settlement website, www.KiaMPGClassSettlement.com through July 5, 2015.

Will I be notified about the lump sum payment option?

Yes – you will receive a notice by first class mail to advise you of the proposed settlement sometime from late December 2014 to early January 2015. Details of the options available to you will be outlined in that notice and you can visit the separate website established to provide you with additional details and updates regarding the progress of the proposed settlement (www.KiaMPGClassSettlement.com).

I’ve reviewed the proposed settlement agreement and still have questions about it – how can I get those answered?

Questions about the terms of the proposed settlement agreement may be directed to Class Counsel Robert B. Carey at Hagens Berman Sobol Shapiro LLP, 11 W. Jefferson St., Suite 1000, Phoenix, AZ 85003.

GENERAL

What is the issue?

Kia America has announced corrections to the fuel economy ratings for approximately 300,000 Kia vehicles. An internal review has concluded that a set of procedural misinterpretations and errors at the joint Hyundai/Kia technical centers led to overstated miles per gallon (MPG) ratings for 2011-2012 model year Optima Hybrids, and 2012-2013 model year Rios, Souls, Sportages, and certain 2012-2013 Sorentos equipped with GDI engines. Gasoline-powered Optima, Forte and Sedona models, as well as Sorentos with MPI engines, are not affected.

We deeply regret these errors and sincerely apologize to our valued customers.

How did this happen?

In 2009 Kia and Hyundai's joint testing facility created a new team of engineers to improve MPG testing procedures. One of the first things they attempted to do was increase test accuracy and repeatability by creating additional protocols, which complied with EPA guidelines, for Kia engineers to follow in every test to enhance reliability. What we learned from the EPA is that some of those new procedures do not comply with their interpretation and industry practices and led to overstated MPG ratings.

How long have you known about this?

The EPA alerted our U.S. technical center in the first quarter of 2012 to some fuel economy discrepancies they observed while evaluating coastdown testing for some of our vehicles. The joint Hyundai/Kia technical operations here in the U.S. and in Korea conducted an internal review throughout the spring and summer of 2012 to understand the basis of these discrepancies and to re-test certain vehicles prior to the November 2012 announcement.

What are you doing about it?

We are taking the following steps to immediately address these errors:

We have corrected the fuel economy ratings for the affected model year vehicles and re-labeled 2012 model year vehicles currently in dealer inventories;
We are compensating all current and former owners of affected vehicles to cover added fuel costs associated with the MPG ratings adjustments.

How long will it take you to relabel cars in showrooms?

As part of the corrective actions, the fuel economy ratings for vehicles in dealers’ inventory were relabeled.

Why is the Soul fuel rating adjustment so much larger than the others?

The Soul received powertrain enhancements for the 2012 model year which improved fuel efficiency. Human error caused the selection of certain incorrect data for the coastdown calculations that year requiring greater EPA fuel economy adjustments for the Soul than other affected Kia vehicles.

Still, due to the 2012 model year improvements, many Soul models continue to achieve an EPA stated 30 miles per gallon on the highway.

What about the Rio?

The 2012 Rio was also affected by the same human error as the Soul, but the impact was less than for the Soul. Even after the corrections the Rio's highway rating is 36 MPG.

ASSESSMENT OF IMPACT

Are sales and deliveries being disrupted? How about the long term?

No, sales and deliveries are not being disrupted. Current and future dealer vehicle inventories are being updated with corrected fuel economy ratings and we are addressing the issue directly with current and previous vehicle owners.

Does this call Kia's dedication to fuel economy into question?

No. We always have and will continue to offer some of the most fuel-efficient vehicles in the market and on the road.

How is "fuel economy" regulated here in the U.S.?

This is a complicated process. For a full description please refer to the EPA's website – www.fueleconomy.gov.

Why don't you test your vehicles here in the U.S.?

We have a comprehensive global research and development facility in Korea. The same engineering variability and interpretive issues would apply, regardless of where the tests are conducted. The issue really is "how," not "where."

Does this prove that self-certification doesn't work?

The federal government employs a self-certification model while other countries have adopted other processes. Our understanding is both models have worked well over time. We are fully committed to complying with the testing protocols and procedures adopted by the jurisdiction in which we operate.

CURRENT CUSTOMER REIMBURSEMENT PROGRAM

As of December 23, 2013, Kia has entered into an agreement with plaintiffs who are seeking to represent all current and former owners and lessees of vehicles affected by the November 2012 restatement of fuel economy ratings. If you have questions about that program, please click here.

Is my vehicle affected? If so, how do I get compensated?

If you purchased an affected vehicle either new or used on or prior to November 2, 2012, regardless of whether you still own it, you are eligible for reimbursement for your added fuel costs associated with the MPG ratings adjustments for the miles you've driven the vehicle.

NOTE: Vehicles are reported sold at varying times so the initial website database may not initially include vehicles sold on or immediately preceding November 2nd. Kia will be updating the website periodically with additional eligible VINs so customers who recently purchased affected vehicles should check back in a week or so. Of course, if any issues arise in the meantime, a customer can contact the Kia Fuel Economy Ratings Adjustment Program Center at 855.912.5648 for assistance.

How are affected customers being compensated?

Kia has developed a comprehensive reimbursement program for affected current and former vehicle owners to cover the additional fuel costs associated with the MPG rating adjustments for the miles the vehicle is driven. Affected vehicle owners will be compensated for the total miles the vehicle is driven during their ownership period. You will be able to receive compensation at various intervals during your ownership.

How will my compensation be calculated?

After registering and qualifying online, customers who are current owners will be instructed to visit your preferred Kia dealership to have your mileage and vehicle ownership validated. The validation takes place in the dealership’s service department so it is recommended that you contact the service department ahead of time to confirm their hours of operation. If you previously owned an affected vehicle, you are also eligible for reimbursement based upon your miles driven. See the section below entitled “What if I’ve sold an affected vehicle?” for more information about that claim submission process.

Once completed, the reimbursement amount will be calculated using the average fuel price as published by the U.S. Energy Information Administration (http://www.eia.gov/petroleum/gasdiesel/) in your area plus an additional 15% allowance, and actual miles driven. Fuel price reimbursement rates will be updated monthly based upon a rolling 12-month average.

For example:

You’ve driven 10,000 miles in your 2011 Optima Hybrid.
Your original combined MPG rating was 37 MPG and your new combined MPG rating is 36 MPG (a difference of 1 MPG).
Under the original combined MPG rating, you would have expected to use 270.3 gallons of gasoline for 10,000 miles of driving (10,000 divided by 37).
Under the new combined MPG rating, you can expect to use 277.8 gallons of gasoline for 10,000 miles of driving (10,000 divided by 36).
There is a difference of 7.5 additional gallons of gasoline (277.8 gallons minus 270.3 gallons)
You will be reimbursed for 7.5 gallons of gasoline at the average fuel price in your area plus an additional 15% allowance as referenced above.

What is my VIN number and how can I find it to check to see if my car is eligible?

VIN stands for vehicle identification number and is a unique 17-character number, containing both numbers and letters, to identify your vehicle. Your VIN can be found by looking at the dashboard on the driver's side of the vehicle. The easiest way to view it is to stand outside the vehicle on the driver's side and look at the corner of the dashboard where it meets the windshield. VINs are also listed on insurance cards/policies and vehicle registration documentation.

Where can I find the nearest Kia dealership?

You can find your nearest Kia dealership by visiting the Dealer Locator section of www.Kia.com.

I live a long way from a Kia dealership — do I have to go there to have my vehicle mileage confirmed?

Once you have determined online whether your vehicle is affected and you have registered for the reimbursement program, we ask you to go to your preferred Kia dealership for vehicle ownership and mileage verification as part of the reimbursement process.

How soon will I get compensated?

We will do everything we can to ensure prompt and proper reimbursement. Once you have registered for the program and visited your dealer for ownership and mileage verification, we expect you will receive compensation within fifteen business days.

I bought my car used — do I qualify?

Yes, if it's an affected vehicle purchased before November 2, 2012.

What if I bought my Kia outside the United States – is it still affected?

The fuel economy ratings in question affect only vehicles sold in North America. All Kia cars sold in other regions of the world have been properly certified with correct fuel economy ratings by each respective certification agency. If you purchased your vehicle in Canada, please visit the website for Canadian residents at www.kiafuelconsumption.ca to verify vehicle eligibility and to register for reimbursement.

Is there something my dealer can install/fix so I get better fuel economy?

No. This issue is not about a technical or mechanical issue that can be fixed by a dealer but about testing procedures that impact fuel economy reporting. For additional information about how to maximize the fuel economy performance of your vehicle (tips for driving more efficiently and keeping your car in shape), visit www.fueleconomy.gov.

Can I return my affected vehicle?

The reimbursement program is designed to compensate affected vehicle owners for the difference in fuel economy ratings and does not include the return of affected vehicles. Kia is concerned with your satisfaction with your purchase. If you have any other issues with your vehicle which require assistance, please contact the Kia Customer Care Center at 800.333.4Kia(4542).

What if I've sold an affected vehicle?

You are eligible for reimbursement of the added fuel costs associated with the MPG rating adjustments during your period of ownership based upon your area of residency and the miles driven. You need only complete your registration on this website, print out the Fuel Reimbursement Estimate form that is generated after your registration, and submit the following documentation to the Kia Fuel Economy Ratings Adjustment Program Center at kiampg@kiausa.com for review:

Copy of the Fuel Reimbursement Estimate form (claim ticket)
Proof of prior ownership (copy of vehicle title OR registration)
Proof of mileage at the time of vehicle disposal (acceptable documentation includes a copy of the vehicle bill of sale OR copy of a fully-signed purchase contract for a new vehicle that lists the Kia vehicle and mileage as a trade-in)

Once submitted, we will review the documentation and authorize a one-time payment based upon the verified mileage during your ownership period if the documentation is in order. As you will only be eligible for a one-time payment, please be certain that the mileage documentation clearly supports the mileage amount you are claiming for reimbursement. You will be contacted directly if there are any questions or issues. You will NOT be required to visit a Kia dealership to obtain reimbursement.

Is my vehicle now worth less?

Although fuel economy is one of many factors used to determine resale value, we believe your vehicle will maintain resale value stability even with these fuel economy ratings adjustments. In relation to that, it's important to remember that Kia vehicles remain among the most fuel-efficient on the market and on the road today, even with these fuel economy adjustments, and will be supported by being industry leaders in safety and quality.

What can I do to get better fuel economy?

Fuel economy is impacted by a number of real-world driving factors. For information on how to maximize your fuel economy when driving, visit www.fueleconomy.gov/feg/drive.

Overview

I heard that Kia has reached an agreement with the U.S. Environmental Protection Agency. What are the details?