Well, it turns out Hino Motors, the commercial truck arm of Toyota, decided it wanted to live its best Dieselgate life, and now it’s paying the price—$1.6 billion to be exact. That’s the bill for pleading guilty to a multi-year conspiracy to fake emissions data and skirt U.S. and California environmental regulations. Spoiler: the EPA and Justice Department just told Hino to “get rekt”. 

(Source: Giphy) 

In short, from 2010 to 2022, Hino apparently thought, “Why bother with real emissions tests when we can just make stuff up?” Over 110,000 heavy-duty diesel engines were shipped into the U.S. using doctored data to pass emissions standards. Some engines even skipped proper testing entirely, like a high schooler “forgetting” to study and just copying someone else’s homework.

Now what’s interesting here is that this wasn’t just your run-of-the-mill rule-bending fiasco. It spanned more than a friggin’ decade, involved altering test results, and even fabricating data from scratch. According to Assistant Attorney General Todd Kim, Hino’s actions led to “vast amounts of excess air pollution” and violated U.S. environmental, consumer protection, and import laws. LOL you know it’s bad when the Justice Department, EPA, FBI, Customs and Border Protection, and California Air Resources Board all tag-team to take you down.

(Source: NPR) 

With that said, here’s how Hino’s punishment breaks down: For starters the criminal fine for the whole “lying to regulators” thing is priced at $521.76 million, while the civil settlement to cover clean-up efforts, including replacing dirty engines on ships and trains with cleaner versions and funding hybrid and zero-emission vehicles in California is a hefty $1.1 billion. What’s more is that Hino is getting hit with a five year probation of no diesel engine imports to the U.S.---including forced implementation of compliance and ethics programs to make sure they don’t pull this stunt again. Oh, and California regulators will make sure those trucks don’t get a free pass. Hino will offer voluntary repairs for some vehicles to offset the pollution caused, though there won’t be any buybacks.

Of course, if this story sounds somewhat familiar, it’s probably because you  remember Volkswagen’s Dieselgate scandal—a PR disaster so bad it became a how-not-to guide for corporate malfeasance. Hino’s antics might not have reached VW levels of infamy, but it’s certainly a strong runner-up. 

(Source: AP) 

Additionally, Toyota isn’t the model parent in this case either. They’ve had their fair share of emission scandals themselves, including getting caught submitting false data in Japan before, with its subsidiaries “shaking the very foundations of the company as an automobile manufacturer,” according to a previous corporate apology. Which means this may be the perfect case of “bad parent = little sh*t child”. 

For Hino though, “sorry” seems to be the hardest word possible. Satoshi Ogiso, Hino’s CEO, did the usual mea culpa thing, calling the settlement a “significant milestone.” In a statement, he said, “We deeply apologize for the inconvenience caused to our customers and stakeholders.” Translation: “We are only sorry we got caught.” Meaning, whether that’s enough to rebuild trust with regulators, customers, and shareholders remains to be seen.

(Source: Giphy) 

At the end of the day, Hino’s $1.6 billion is a bigly wakeup call that faking emissions data is never a good idea—unless you enjoy paying record fines and getting dunked on by every regulatory agency in the book. For now, Hino’s trucks are still on the road, and the company is still operating, but it’s safe to say this scandal will leave a lasting dent in its reputation. 

So, the next time your favorite automaker says their engines are “clean,” maybe don’t take their word for it. As we’ve learned from Hino, Volkswagen, and others, sometimes the exhaust doesn’t lie—but the numbers might. In the meantime, do what you will with this information and place your bets accordingly as Toyota is down -6.22% YTD. And as always, stay safe and stay frosty, friends! Until next time…

P.S. Hino has to fake emissions data to get a competitive “edge”---I use Stocks.News to gain a competitive edge, we are not the same. Join us on the winning side, and get access to a swath of tools that makes real-time analysis and deciphering the market as simple as ever. Oh and did I mentioned we are ranked the #23 BEST App (not just finance) on the App Store? Bigly. Click here to join us and see just how real the hype is… 

Stocks.News does not hold positions in companies mentioned in the article.