Hyundai and Kia agree to $200m settlement over US car thefts

Hyundai and Kia agreed to a consumer class action lawsuit settlement worth $200m (roughly R3.87bn) over rampant car thefts of the Korean automakers' vehicles, lawyers for the owners and the automakers said on Thursday.

In February, the Korean carmakers 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 $145m (R2.8bn) 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 $300 (R5.8bn) 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 to 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 $6,125 (R118,352), damage to vehicle and personal property up to $3,375 (R65,214) 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 carmakers over the thefts.