Following Volkswagen’s debilitating and outright embarrassing diesel emissions scandal, Fiat Chrysler Automobiles may now find itself with its own scandal after a 2015 internal review ordered by FCA executives on allegations of sales padding unearthed documents saying some dealerships had reported thousands of vehicle sales in the U.S. with no actual buyers.
Citing multiple sources, Automotive News is reporting that 5,000 to 6,000 vehicles had been reported as sold by dealerships and subsequently unwound, a term used to let customers out of a deal. The sources added that the sales numbers were intentionally inflated, reflecting earlier allegations made by two dealers in a civil lawsuit filed against FCA back in January 2016. Apparently, the alleged sales padding was done to help FCA continue its current run of 75 consecutive months of year-over-year sales increases.
FCA’s U.S. sales head, Reid Bigland, reportedly put a stop to the practice following the review, but those calls only lasted temporarily as the practice continued in the wake of “competitive pressures” brought about by the increase of FCA’s field staff.
Multiple government agencies, including the Federal Bureau of Investigation, the Securities and Exchange Commission, and the Department of Justice are already investigating these allegations, which if proven true, could turn into the next automotive scandal and perhaps leading to plummeting stocks for FCA.
For its part, the automaker has acknowledged that a federal investigation is ongoing. The automaker hasn’t elaborated on the finer details of the investigation, presumably opting to keep its mouth shut in preparation for a court defense.
Continue after the jump to read the full story.
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