New York City sues Hyundai, Kia over vehicle thefts

By Jonathan Stempel

NEW YORK (Reuters) -New York City on Tuesday sued Hyundai Motor Co and Kia Corp, accusing the South Korean automakers of negligence and creating a public nuisance by selling vehicles that are too easy to steal.

The most populous U.S. city joined several other major cities that have sued Hyundai and Kia over the thefts, including Baltimore, Cleveland, Milwaukee, San Diego and Seattle.

In a complaint filed in Manhattan federal court, New York faulted the automakers’ failure from 2011 to 2022 to install anti-theft devices called immobilizers on most of their cars, making them “nearly unique” among automobile manufacturers.

New York said this has “opened the floodgates to vehicle theft, crime sprees, reckless driving, and public harm,” exacerbated by TikTok videos showing how to steal cars that lack push-button ignitions and immobilizers.

The city said the number of reported stolen Hyundais and Kias doubled last year, followed by a “virtual explosion of thefts” in the first four months of 2023 with 977 reported thefts, up from 148 in the same period in 2022.

In contrast, the city said thefts of BMW, Ford, Honda, Mercedes, Nissan (OTC:) and Toyota vehicles have fallen this year.

The complaint seeks unspecified compensatory and punitive damages.

Hyundai said in a statement that it made immobilizers standard on all vehicles in November 2021, and has taken steps including a software upgrade to reduce the threat of thefts.

Kia had no immediate comment.

In February, Hyundai and Kia said they would offer software upgrades for as many as 8.3 million U.S. vehicles that lack the immobilizers.

Last month, Hyundai and Kia reached a $200 million settlement of a consumer class action over the thefts.

That case covered about 9 million U.S. vehicle owners, and included as much as $145 million to cover losses for stolen vehicles, lawyers for the owners said.

The case is City of New York v Hyundai Motor America et al, U.S. District Court, Southern District of New York, No. 23-04772.