Hyundai and Kia ordered to pay $9M in settlement

Hyundai and Kia reached a $9 million settlement with 34 states — including New Mexico — after failing to install proper theft prevention technology in their vehicles.

"Without this technology, Hyundai and Kia vehicles were vulnerable to thieves, leading to a spike in vehicle thefts across the country that destroyed cars and public property, threatening public safety, and threatened injuries and deaths," New Mexico Department of Justice spokesperson Chelsea Pitvorec said in a Dec. 23 news release.

The settlement requires Hyundai and Kia to pay up to $4.5 million to customers whose cars were recently stolen or damaged, and $4.5 million in penalties to states, she said.

The companies also agreed to equip future vehicles with industry-standard, engine immobilizer anti-theft technology and offer free zinc-reinforced cylinder protectors to owners or lessees of eligible vehicles from 2011-2022. This includes vehicles that were only eligible for the companies' software updates, Pitvorec said.

"Customers should never have to worry that their vehicle is an easy target because manufacturers failed to include basic, industry-standard safeguards," New Mexico Attorney General Raúl Torrez said in a statement. "New Mexicans rely on their cars every day, and when companies cut corners, it puts families and public safety at risk. Holding manufacturers accountable ensures consumers can trust the vehicle they depend on."

Pitvorec said Hyundai and Kia chose not to include anti-theft "engine-immobilizer" technology in millions of vehicles. The technology prevents thieves from starting a vehicle without a "smart" key in millions of their vehicles.

The companies, she added, were "slow to respond to a drastic, nationwide increase in vehicle thefts, waiting until 2023 to launch a service campaign to update the software on many affected vehicles. 

"(The companies) offered to install a zinc-reinforced ignition cylinder protector, but only for the roughly 20% of their vehicles that were ineligible for this software update," Pitvorec said. "While the companies claimed that the software update blocked the viral theft method, the states alleged that the software update could be, and in fact, was easily bypassed by thieves."

Hyundai and Kia did not respond to comment as of Sunday afternoon.

"The coalition of attorneys general pressed Hyundai and Kia to do more to protect consumers and, through this settlement, Attorney General Torrez has ensured that all consumers with eligible vehicles can have zinc-reinforced ignition cylinder protectors installed on their vehicle free of charge," she said.

Customers will have a year from the date of notice from the companies to make an appointment to have the protector installed at their local dealerships, she said. Pitvorec said Torrez recommended customers schedule an appointment "as soon as possible."

Customers who had or were scheduled to have the software update installed but dealt with a theft or an attempted theft on or after April 29, she said, are eligible to file a Hyundai and/or Kia claim. Kia customers can also call 1-800-333-4542.

The attorneys general of Connecticut, Minnesota, and New Hampshire led the multistate settlement. Other states involved include: Arizona, California, Colorado, Delaware, Georgia, Hawaii, Illinois, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Vermont, Washington and Wisconsin. The District of Columbia was also part of the settlement.

Gregory R.C. Hasman is a general assignment reporter and the Road Warrior. He can be reached at ghasman@abqjournal.com or 505-823-3820.