WASHINGTON: Hyundai Motor and Kia Corp agreed to a consumer class-action lawsuit settlement worth US$200 million over rampant car thefts of the Korean automakers’ vehicles, lawyers for the owners and the automakers said on Thursday.
In February, the Korean automakers said they would offer software upgrades to 8.3 million US vehicles without anti-theft immobilisers to help curb increasing car thefts using a method popularised on TikTok and other social media channels.
The settlement covers about 9 million US owners and includes up to US$145 million for out-of-pocket losses for consumers who had cars stolen, lawyers for the owners said.
Hyundai and Kia said they will compensate owners “who incurred theft-related vehicle losses or damage in addition to reimbursement for insurance deductibles, increased insurance premiums, and other theft related losses.”
For customers whose vehicles cannot accommodate security software upgrades, the Korean automakers will provide up to US$300 for the purchase of steering wheel locks and other theft deterrent or prevention devices.
“The settlement will provide benefits as soon as possible to those who have suffered out-of-pocket losses,” said Steve Berman, a lawyer representing owners.
TikTok videos showing how to steal cars without push-button ignitions and immobilising anti-theft devices has led to at least 14 reported crashes and eight fatalities in the US, regulators said in February.
The consumer settlement covers owners of 2011 through 2022 model year Hyundai or Kia vehicles with a traditional “insert-and-turn” steel key ignition system. It includes payments for total loss of vehicles up to US$6,125, damage to vehicle and personal property up to US$3,375 and insurance-related expenses.
Other related expenses including car rental, taxi or other transportation costs not covered by insurance are also included by the settlement.
Owners can get reimbursed for towing costs and for stolen vehicles that suffered crashes or were never recovered, as well as payments for tickets or other penalties or fines incurred arising from a stolen vehicle.
Many major cities have sued the automakers over the thefts including St Louis, Missouri, Cleveland, Ohio; San Diego, California; Milwaukee, Wisconsin; Columbus, Ohio; Baltimore and Seattle.