The $1 billion lawsuit that has been filed against Hyundai and Kia is still ongoing and shows no signs of disappearing anytime soon. The lawsuit alleges that the automakers sold vehicles with engines that were prone to catching fire, and that they failed to adequately address the issue. Despite efforts by the companies to settle the case, it appears that the plaintiffs are determined to see it through to the end. As the legal battle continues, both Hyundai and Kia will need to carefully navigate the situation in order to protect their reputations and minimize any potential financial damages.
Hyundai and Kia are facing a lawsuit from insurance companies over the theft of their vehicles, which could result in a payout of over $1 billion. The automakers failed to install immobilizers on millions of cars, leading to a surge in thefts of their vehicles. The case was brought by companies that insured the stolen cars, seeking to recoup their losses.
Judge's Ruling
This week, a judge rejected arguments to dismiss the suit, accepting the plaintiff's argument that it was "reasonably foreseeable" that people would steal vehicles that lacked the theft-prevention device. Federal Motor Vehicle Safety Standard 114 requires that a car must have a starting system that prevents the normal activation of the car's engine or motor if the key is removed from the vehicle's starting system.
Automakers' Defense
Hyundai and Kia had argued that the insurance companies had accepted liability for the thefts by insuring the vehicles. However, US District Judge James Selna rejected that argument, noting that this case asserts claims that the automakers violated state consumer protection laws, breached implied and expressed warranties, and committed fraud through omission and concealment.
Theft Statistics
The thefts of Kia and Hyundai vehicles rose dramatically in 2021, and social media helped spread videos showing how to steal specific models that weren't equipped with immobilizers. In Milwaukee, Wisconsin alone, Kia thefts were up 2,644 percent this year, while affected Kia vehicles date back to 2011 and compromised Hyundais start with the 2015 model year.
Previous Settlement
Earlier this year, the two companies reached a $200 million settlement on a class-action lawsuit filed by vehicle owners. The settlement is expected to cover some nine million drivers and compensate them for their out-of-pocket losses. The automakers also released a software update earlier this year to make stealing their cars harder.
Financial Risks
As the legal battle continues, Hyundai and Kia face significant financial risks as they attempt to defend themselves against the lawsuit brought by insurance companies. The outcome of this case could have far-reaching implications for automakers and insurers alike, as they grapple with how best to prevent vehicle thefts and protect consumers.
(This article is sourced from Motor1.com and curated by Thetransporteronline24)
