Hyundai, Kia To Pay $200 Mln To Settle Car Theft Suit

(RTTNews) - South Korean automakers Hyundai Motor and Kia Corp. have agreed to pay about $200 million to settle a class-action lawsuit over their vehicles' vulnerability to theft due to a design flaw in vehicles manufactured without an engine immobilizer, an anti-theft mechanism.

The settlement agreement is expected to benefit owners of about nine million vehicles.

In the lawsuit, which awaits a judge's approval, lawyers for the car owners accused the companies of producing vehicles that are vulnerable to being stolen due to potential security defects.

The anti-theft immobilizers have been a standard equipment on vehicles sold by other major manufacturers in the U.S.

The lawyers stated that the European Union has required immobilizers as a standard feature for all new vehicles since 1998. Yet, Hyundai and Kia have chosen to omit immobilizers in millions of vehicles in the U.S., despite deploying them in vehicles sold in countries with immobilizer requirements.

Unlike most vehicles, the Hyundai and Kia models do not offer an immobilizer, allowing thieves to steal vehicles by simply opening the steering column and using a common USB charging cord or similar metal object to start the engine. These security defects often leave owners with repair bills in excess of $10,000.

The country is facing increasing thefts after TikTok and other social media channels popularized a method, dubbed the "Kia Challenge," showing how to steal cars without push-button ignitions and immobilizing anti-theft devices. Majority of the most commonly stolen car brands in the United States were said to be manufactured by Hyundai and Kia.

"We believe consumers who purchased affected Hyundai and Kia cars deserve better, and the automakers responsible failed to adequately protect against basic theft in order to cut costs," the lawyers said.

In mid March, a group of 23 U.S. states attorneys general had asked Hyundai and Kia to take action more quickly to solve problems with millions of U.S. vehicles facing theft.

In a joined letter from 22 states and the District of Columbia, the attorneys general led by Wisconsin's Josh Kaul called on Kia and Hyundai to take swift and comprehensive action to help remedy the crisis of car thefts.

The companies in February had said they would offer software upgrades to 8.3 million U.S. vehicles they manufactured without an engine immobilizer with a view to help customers from thefts.