Hyundai and Kia shares plummet upon German probe on defeat device

[Photo by MK DB]

Shares of South Korea's Hyundai Motor Co. and its sibling Kia Corp. lost more than 5 percent Wednesday upon news that their offices had been raided by German authorities over allegations of putting 21,000 diesel vehicles with illegal defeat devices on the road.

Shares of Hyundai Motor closed down 5.65 percent to 175,500 won ($135.21) after going as low as 172,500 won ($133.48). Kia¡¯s slid 6.11 percent to 76,900 after hitting 76,000 won.

A spokesperson of Hyundai Motor Group said the company was cooperating with authorities.

According to foreign media reports, Frankfurt state prosecutor raided eight Hyundai and Kia business properties in Germany and Luxembourg in coordination with the European agency Eurojust.

In a statement released by the prosecution office, Hyundai and Kia allegedly put 21,000 diesel cars fitted with illegal defeat devices on the road. Defeat devices are software that can alter vehicle emission levels and auto manufacturers can use them to hide the true pollution levels of their vehicles.

The engine software that is being investigated is presumed to have come from Bosch and Delphi under the U.S. auto supplier BorgWarner group.

[¨Ï Maeil Business Newspaper & mk.co.kr, All rights reserved]