GM to compensate SUV buyers up to $100M total for fuel economy discrepancies

2016 Buick Cascada
In the aftermath of the overstating fuel economy on midrange SUVs, General Motors has announced how it will compensate buyers, according to Reuters. GM had to halt deliveries on approximately 60,000 vehicles earlier this month when the error was discovered. At the time, the company said it would work out how to compensate previous buyers of the 2016 models. Now we know: Buyers will be given a choice of prepaid debit cards or extended warranties.

The vehicles affected are 2016 model year Chevrolet Traverse, Buick Enclave, and GM Arcadia SUVs. In all, about 146,000 vehicles were sold in North America — 135,000 in the U.S. and 11,000 in Canada. Buyers will qualify for debit cards for $450-$900, or $1,000-$1,300 Canadian. The actual amounts will be based on a formula using a gasoline price of $3 per gallon and 15,000 miles per year for five years.

Owners will also have the choice of a 48-month, 60,000-mile extended warranty for the vehicles, which could be a better choice than a debit card for those who intend to keep their SUVs for a long time. People who leased one of the GM SUVs will receive the prepaid debit cards. GM is going to work out individual deals with rental car companies, commercial, and government buyers that purchased approximately 40,000 of the SUVs.

The error occurred in calculating mileage. The engine and transmissions did not change from 2015 to 2016, but there were changes to the emission equipment which made a 1-2 mile per gallon difference. It wasn’t until GM engineers aware of the difference were working on paperwork for the window stickers for 2017 models that they noticed the error in the 2016 ratings. The data from new emissions equipment had not been included in the calculations.

As a result of the error, GM halted all deliveries of the three SUV models until dealers received corrected window stickers. The debit cards and extended warranty choices are for previous purchasers only and it is not known if the 1-2 mph rating change will affect future sales. The U.S. Environmental Protection Agency has started an investigation has asked for information from testing.

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