Hyundai and Kia are under investigation involving into nationwide car fires. The legal authorities said the result of that investigation could determine those companies’ litigation risks.
The two corporations have recalled 500,000 cars over the fire risk, and in a news reports there have been 300 engine fires since June.
Currently, their risks seem to hinge on whether investigators could find a car producers put profits over user safety. In the meantime, it’s not clear to date what other states could join Connecticut its investigation of the vehicle fires.
If the probe shows intended malfeasance and negligence, the car manufacturers could face a long road ahead, according to a University of Connecticut School of Law professor.
“The fact that they want to do an investigation does not mean it will yield evidence of wrongdoing, but if they find evidence that the cars have a propensity to spontaneously combust and this was known, then they have an obvious serious exposure legally for the car companies,” University of Connecticut School of Law professor said. “It would mean a recall and probably many civil suits. You can just look at the many lawsuits against Volkswagen for the emission scandal, or GM arising out of the Kobalt car ignition-switch issue. If that is the case, you are looking at substantial exposure. But it all depends on what the investigation shows, and what the problem is.”
Also, a Hartford-based attorney said, “If the company had knowledge that these fires were a risk, and they made a business calculation that the costs of the fires would be less than the profits to be made from selling their defective vehicles, they’d be subject to punitive damages and a lot of lawsuits.”
“They can survive,” said Hartford-based attorney, managing partner at Howard Kohn Sprague & FitzGerald. “There are some really loyal customers that really like and prefer Hyundais. People thought Volkswagen would go under, and they survived.”
“One of the biggest costs to companies is reputational injury, in that people do not trust the car company,” she said. “If that’s the case, they will buy a different brand. I don’t think, though, that people will change their behavior until some kind of proof [of wrongdoing] comes out.”
Hyundai and Kia producers recall some hundred thousand vehicles
In his announcement Monday, Tong said, “This is a serious matter, and we are moving aggressively and responsibly to uncover the facts and to ensure accountability.” The release noted that there have been accounts of Hyundai and Kia vehicles spontaneously bursting into flames and catching fire while driving or parked.
Both vehicle producers initiated recalls of some hundred thousand vehicles equipped with the Theta II Gasoline Direct Injection engine beginning in 2015. A news agency also reports that the vehicle manufacturers are the subject of three separate recalls from the National Highway Traffic Safety Administration, or NHTSA.
Representatives of Hyundai and Kia said they are working to address the issues.
James Hope, national manager, product communication for Kia Motors America, said in a report: “The safety of our customers is one of Kia’s top priorities and we take this matter seriously. Kia is fully cooperating with state investigators into the performance of our vehicles and we have and will continue to openly share information and data with NHTSA and other investigative bodies in a full and transparent manner.”
Kia also said it voluntarily start off some measures to ensure it addressed every non-collision car fire. In June 2017, for example, Kia recalled over 600,000 Optimas, Sorentos and Sportage automobiles to address a manufacturing defect that could cause engine failure and, in rare cases, fire.
Michael Stewart, senior group manager of corporate and marketing public relations for Hyundai, wrote, “Hyundai is fully cooperating with the government in this matter, and is committed to providing American motorists with safe, high quality, efficient and affordable vehicles.”