Cummins Inc (NYSE:CMI) agreed on Wednesday to a record-setting fine of $1.675 billion in the settlement of a lawsuit filed by the US Justice Department and California, which charged the truck engine maker with installing devices designed to cheat emissions control, Reuters reported.
The lawsuit alleged that Cummins installed "defeat devices" to bypass or disable emissions controls such as emission sensors and onboard computers.
Cummins will also spend more than $325 million to remedy the excess emissions, including $175 million to California to reduce excess nitrogen oxide, and will fund replacement high-emitting diesel locomotive engines, the media outlet noted.
The company did not admit any wrongdoing under the settlement agreement.
In December, Cummins reported that it expects to record a $2.04 billion charge in the fourth quarter of 2023 to resolve emissions claims.
Shares of Cummins slipped 1.4% to $235.98 in late-morning trading on Thursday.