The EPA just accused Fiat Chrysler of cheating on emissions with its diesel trucks

Last fall, the Environmental Protection Agency discovered that Volkswagen had used illegal “defeat device” software that enabled hundreds of thousands of diesel vehicles to cheat on their pollution tests. As a result, the cars emitted far more harmful nitrogen oxide on the road than they did during laboratory testing. This ended up being a huge global scandal that cost VW billions of dollars.

Now the scandal may be widening. On Thursday, the EPA also accused Fiat Chrysler of cheating — by failing to disclose software in at least 104,000 diesel vehicles that could increase their emission levels.

You can see the full release from the EPA here. One key thing to note is that it’s still not clear that this is exactly like the Volkswagen scandal, which featured a company that was very explicitly trying to fool regulators. Fiat Chrysler denies it was doing anything of the sort. Here’s a breakdown what we know so far:

1) After the VW scandal broke, the EPA began testing other carmakers’ vehicles to see if their pollution levels on the road matched what was being shown in the lab tests used by regulators. The agency discovered that a number of Fiat Chrysler models — including 2014 to 2016 model year Dodge Ram 1500 pickup trucks and Jeep Grand Cherokees with 3.0-liter diesel engines — emitted higher levels of nitrogen oxide pollution “under conditions that would be encountered in normal operation and use.” (There are at least 104,000 such vehicles on the road today.)

2) On closer inspection, the EPA discovered that these vehicles also contained “at least eight undisclosed pieces of software that can alter how a vehicle produces air pollution.”

3) That was a no-no. Failing to disclose software that can affect emission levels runs afoul of the Clean Air Act, which is why the EPA just sent Fiat Chrysler a “notice of violation.”

4) However, the EPA is still investigating what this software actually did and why it was there. “We continue to investigate the nature and impact of these devices,” says Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. In particular, the agency is investigating whether these were illegal Volkswagen-style “defeat devices” that automatically turned on pollution controls during lab tests and then switched the controls off when customers drove the cars on the road.

5) Fiat Chrysler, for its part, denies that its software was similar to Volkswagen’s. Instead, it says this was simply normal software to fine-tune emissions output from the car and help its vehicles “balance EPA’s regulatory requirements for low nitrogen oxide (NOx) emissions and requirements for engine durability and performance.” The company plans to plead its case with the incoming Trump administration.

6) After the announcement, shares of Fiat Chrysler plunged more than 13 percent before trading was halted on the New York Stock Exchange:

7) If the EPA and Department of Justice find that Fiat Chrysler was using illegal defeat devices, this could be a huge, huge deal for the company. Volkswagen will end up paying up to $14.7 billion to compensate car owners and settle lawsuits in the United States over its clean diesel scandal, which affected 500,000 vehicles.

Why would an automaker want to cheat on an emissions test anyway?

A starting point for understanding this story is to realize that all cars and trucks come with tradeoffs. Diesel vehicles, which are widely popular in Europe but less so in the United States, tend to get better mileage than their gasoline counterparts. That’s partly because diesel fuel contains more energy per gallon than gasoline but also because the diesel engines themselves are more efficient.

The catch is that diesel engines tend to emit higher levels of other nasty air pollutants, including soot, particulates, and nitrogen oxides (NOx). Heavy exposure to these pollutants can exacerbate heart and lung disease, trigger asthma attacks, and even cause premature death.

In order to meet the strict US air-pollution standards, diesel manufacturers typically have to add NOx emissions controls to their vehicles. But these controls can degrade the cars' performance when switched on — they can affect torque and acceleration, cause the engines to run hotter and wear out more quickly, or worsen mileage. So, to try and balance all these different considerations, modern-day manufacturers sometimes add elaborate software to fine-tune the engines and pollution controls for optimal performance.

Volkswagen, for its part, apparently couldn’t build a clean diesel engine that met US pollution standards while also maintaining adequate performance. So the company developed clever (and highly illegal) “defeat devices” that sensed how the car was being driven. When the software detected pedal and steering-wheel movements that indicated the car was being tested in a lab, the NOx controls switched on. But when the car was just being driven normally on the road, the emissions controls switched off and the car emitted way more NOx than the EPA legal limit. The result was more deadly pollution on the road — and also a massive scandal once these devices were uncovered.

Again, we still don’t know if this is what Fiat Chrysler was doing. The company claims its software was perfectly legal, intended to juggle different pollution/performance trade-offs while still complying with EPA emissions limits. We’ll see what further investigations uncover.

Further reading

— It’s worth noting that illegal cheating software isn’t the only problem with diesel vehicles. Back in the late 1990s, Europe began promoting diesel cars as a way to deal with global warming (since they’re much more efficient than gasoline vehicles). But in the years since, EU countries have been choking on excess NOx and other air pollution, and regulators have struggled to clean up these cars. And, thanks to poorly designed pollution tests, many vehicles emit far more NOx on the road than they do in labs — even without Volkswagen’s illegal software. It’s a fiasco.

— For more on Volkswagen, here’s our 2015 explainer on the scandal, a look at the steep financial penalties they’ve faced since, some research on the potentially deadly health effects from VW’s illicit air pollution, and a piece on VW’s subsequent move into electric vehicles.