Hyundai and its subsidiary Kia have admitted that its fuel-economy claims for some of its 2012 and 2013 models are overstated, after the US Environmental Protection Agency found it could not match the figures given on the Korean cars' windscreen stickers.
Not only will those stickers have to be replaced with more accurate versions on thousands of Hyundais and Kias on showroom floors across the US, but the owners of nearly a million cars will be compensated for the extra fuel it has cost them to run their cars.
The situation is all the more embarrassing for Hyundai because it has based a lot of its American marketing on its claim that it has four models in its US range that will burn less than six litres of petrol per 100 kilometres on the open road.
In fact three of them - the 2012 Accent, Veloster and Elantra - can't match the advertised figures, running between 6.22 and 6.39 litres per 100km in EPA testing.
The biggest discrepancy was on the two-litre Soul, which Kia said would use 6.75 litres per 100km on the open road; the best the EPA could get was 8.15.
PUBLIC COMPLAINTS
The agency doesn't routinely test every car on the US market - their funding will usually cover about 150-200 tests a year - but they started looking more closely at the Korean brands after receiving a number of complaints from members of the public, culminating in a class-action lawsuit against Hyundai filed in July by a group called Consumer Watchdog, on behalf of Elantra owner Louis Bird of California.
Then, when they tested an Elantra and the numbers didn't match Hyundai's claims, the lid came off, and Hyundai North America bosses were called in to 'please explain'.
The EPA has occasionally found discrepancies in testing individual models, and insisted that the manufacturer re-label that model. This has happened twice since 2000, it says, but this is the first time it has found exaggerated claims across a whole range of models.
HYUNDAI'S EXPLANATION: 'PROCEDURAL ERROR'
According to Hyundai motor America boss John Krafcik, the discrepancies arose as a result of 'procedural error' during in-house fuel-consumption testing.
Because there are simply too many external variables in the real world, the testing is down on a rolling road, using a specified cycle of acceleration, cruising and slowing down to simulate real-life driving.
One of the variables that's factored in, called 'coastdown', simulates aerodynamic drag, tyre rolling resistance and drivetrain frictional losses and this, apparently, is where the Hyundai boffins got their sums wrong, giving them results that, as customers later found out the hard way, won't stand up on the road.
MAKING IT RIGHT
“We're going to make this right for everybody,” Krafcik said, “and we'll be more driven than ever to ensure our cars deliver outstanding fuel economy.”
Every customer who bought a wrongly labelled car will be given a personalised debit card, that will reimburse them the difference between Hyundai's claims and the EPA's fuel-consumption figures for their model, based on the price of petrol in their area and their odometer readings - even if they've already sold the car.
The cards will continue to be credited as long as the original owner keeps the car and, recognising that not every Hyundai customer drives as accurately as an EPA tester, the maker will add 15 percent to the calculated amount in every case.
What this means is that an average Elantra owner, driving about 25 000km a year, will be reimbursed about $88 (R770) a year as long as they own the car - which doesn't sound like a big deal until you realise that there are 900 000 cars involved.