Cummins to pay $1.67 billion to settle engine emission control claims

US engine maker Cummins Inc has agreed to pay $1.67 billion to settle claims it installed devices to defeat emissions controls in hundreds of thousands of pickup truck engines, the Justice Department said Friday.

The penalty is the largest civil fine ever for a violation of the Clean Air Act, which requires vehicle and engine manufacturers to comply with emissions standards, the department said.

Cummins, which is based in Columbus, Indiana, was accused of installing defeat devices in the engines -- parts or software that can bypass emissions controls or render them inoperative.

Defeat devices and auxiliary emission control devices were allegedly installed on nearly one million engines produced since 2013 for RAM pickup trucks, which are made by Stellantis.

Stellantis referred questions about the matter to Cummins, which said the "company has seen no evidence that anyone acted in bad faith and does not admit wrongdoing," according to a company statement.

Cummins said it had already recalled 2019 Ram 2500 and 3500 trucks and initiated a recall for other vehicles with the devices.

The company expects to incur one-time costs of $2.0 billion for the settlements, which must receive court approval.

Cummins "looks forward to obtaining certainty as it concludes this lengthy matter," the company said.

Attorney General Merrick Garland said the Justice Department "is committed to vigorously enforcing the environmental laws," describing the Cummins devices as having "a significant and harmful impact on people's health and safety."

"Our preliminary estimates suggest that defeat devices on some Cummins engines have caused them to produce thousands of tons of excess emissions of nitrogen oxides," he said.

"The cascading effect of those pollutants can, over long-term exposure, lead to breathing issues like asthma and respiratory infections."

The German automaker Volkswagen was found by the US Environmental Protection Agency in 2015 to have installed emissions control-defying software in diesel-powered cars in a scandal which came to be known as "Diesel gate."

The Justice Department said that the $1.67 billion to be paid by Cummins to the US government and state of California is the second-largest ever environmental penalty, topped only by the more than $20 billion settlement reached with BP in 2015 for the Deepwater Horizon oil spill.

Shares of Cummins fell 3.0 percent in afternoon trading.