Harley-Davidson to pay £11.4m over motorbike ‘defeat devices’

H-D will pay a $12 million civil penalty to the EPA.

Shares of Harley-Davidson (HOG) had tumbled 8% this morning on reports that it had reached a settlement with the Department of Justice over the sale of devices that allow its motorcycles to exceed pollution limits.

The $3 million will go towards a project to mitigate air pollution by replacing conventional woodstoves with cleaner-burning stoves in local communities.

The suit also alleged the company sold 340,000 after-market engine tuners that, once installed, “caused motorcycles to emit higher amounts of certain air pollutants than what the company certified to EPA”, the statement said.

Harley-Davidson is and has been committed to meeting or exceeding all emissions requirements for its motorcycles in every market it serves.

The settlement calls for Harley to stop selling the super tuners by August 23, and buy back and destroy all such tuners in stock at its dealerships.

“This settlement immediately stops the sale of illegal aftermarket defeat devices used on public roads that threaten the air we breathe”, said Cynthia Giles, assistant administrator of EPA’s enforcement arm.

The company agreed to offer to buy back all of the devices, cease selling the tuners and destroy them. These tuners have been sold at Harley-Davidson dealerships across the country. Every vehicle sold in the United States should follow the emission guidelines as per the EPA-issued certificate of conformity. The complaint alleges violations of both these provisions.

Harley-Davidson shares dove more than seven per cent after the news was released but quickly recovered and closed down less than two per cent to $53.54.

Harley-Davidson will conduct tests and provide results to the agency.

Harley-Davidson, Inc., founded in Milwaukee, Wisconsin in 1903, is the largest American manufacturer of motorcycles.

“A certificate of conformity covers only the motorcycle models that were included in the certification application and that are listed on the certificate”. These 12,000 motorcycles were models that were not included in Harley-Davidson’s applications and that were not listed as covered by the relevant certificate. It must ensure that all future bikes will have secured the necessary EPA approvals.

Hydrocarbon and nitrogen oxide emissions contribute to harmful ground-level ozone and fine particulate matter pollution.

H-D maintains that the tuners were clearly marked “not for street use” (it does say so on the instructional website, last time I checked, which was today) and that they conveyed to customers “the legal consequences of tampering with emission controls and components, and what enhancements would void the vehicle warranty”.