Published: Fri, May 26, 2017
Money | By Armando Alvarado

Lawsuit accuses GM of using 'defeat devices' in diesel trucks

Lawsuit accuses GM of using 'defeat devices' in diesel trucks

Looks like it's General Motors' turn in the barrel: The automaker has been accused of installing defeat devices in its trucks' diesel engines in an attempt to beat emissions tests.

A GM spokesman told CNBC that the "claims are baseless and we will vigorously defend ourselves".

If you own or lease a 2011-2016 Chevrolet Silverado Duramax diesel or a GMC Sierra Duramax diesel, you may be entitled to participate in the litigation involving this alleged fraud.

Shares in the company fell nearly 2 percent Thursday. It alleges that the company employed three different "defeat devices" to bypass state and federally mandated emissions tests and that these vehicles actually produce between two and five times the legal limit of NOx gas.

The suit names both GM and the German supplier Bosch, with Bosch called "an active and knowing participant in the scheme to evade USA emissions requirements".

A Bosch representative told CNBC the company "takes the allegations of manipulation of diesel software very seriously".

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The auto manufacturer admitted in 2015 to installing so-called defeat devices in hundreds of thousands of diesel-powered vehicles in the U.S. The devices would activate during road conditions when emission measuring tools were not engaged. It also said modifying the engine to reduce emission levels would affect horsepower, among other performance measures. Government tests don't last that long, the lawsuit says.

RBC Capital analyst Joseph Spak estimated in a note sent Thursday that the diesel versions of the GM pickup trucks in question represent about 12-12.5 percent of all GM full-size pickups.

The lawsuit seeks a variety of damages, including possible refunds or lost resale value as well as punitive damages.

The U.S. EPA did not respond to an inquiry about whether it was investigating GM over the issue. The Duramax was new in 2017, and it was given legal certification by the EPA so it could go on sale.

On Tuesday, the DOJ filed an expected lawsuit against Fiat Chrysler, accusing the Auburn Hills, Michigan-based automaker of building and selling diesel engines that violate the Clean Air Act.

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