On Thursday, May 18, 2023, Kia Corp (Kia) and Hyundai Motors (Hyundai) reached a $200 million settlement in a class-action lawsuit with owners affected by a series of thefts. The suit was filed in August 2022 and alleged that the automakers sold certain vehicles without immobilizers. This standard feature prevents the car’s engine from starting unless the car’s key is present.
About 9 million vehicles across the country have been impacted by the thefts.
Word of the missing immobilizers spread on TikTok and other social media platforms, and, according to the lawsuit, resulted in millions of 2011-2022 Kia and Hyundai models being stolen, often in less than 90 seconds.
The settlement is just one step the automakers are taking to help address victims of the rash of car thefts and prevent future thefts from occurring.
Details of the Settlement
The settlement covers about 9 million owners and includes up to $145 million for out-of-pocket losses for victims of the rampant thefts. Specifically, the settlement covers those who own or owned a 2011-2022 model year Kia or Hyundai vehicle with an “insert-and-turn” key ignition system. Push-to-start Kia and Hyundais are not affected or covered under the settlement.
“This agreement is the latest step in a series of important actions, in addition to providing a free security software upgrade and distributing over 65,000 steering wheel locks, that Kia has taken to help customers whose vehicles have been targeted by criminals using methods of theft popularized on social media,” John Yoon, chief legal officer of Kia Motors America, said in a statement.
Settlement funds could include payments for:
- Vehicle and personal property damage up to $3,375
- Total loss of vehicles up to $6,125
- Insurance-related expenses (e.g., deductibles and increased premiums following a loss claim)
- Transportation costs (e.g., bus fares, taxi fares or rental car costs) not covered under insurance
- Towing costs for stolen vehicles that were involved in wrecks
- Tickets, penalties or fines incurred as a result of the stolen vehicle
The settlement also includes funds to provide up to $300 to customers whose vehicles cannot accommodate the free security software upgrades launched in February 2023 to cover the costs of purchasing steering wheel locks and other theft-deterrent devices.
Finally, the settlement agreement provides that the anti-theft software will automatically be installed on eligible vehicles as part of any dealer service appointment without the owner needing to request it.
What’s Next?
According to Steve Berman, a lawyer representing the owners in the suit, “[t]he settlement will provide benefits as soon as possible to those who have suffered out-of-pocket losses.”
Gaspar Insurance will continue to monitor the situation and provide updates as necessary.
