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Hyundai lowers mileage rating in South Korea, offers compensation

SEOUL -- Hyundai will downgrade the fuel economy rating on its Santa Fe sport utility vehicle by 4% in South Korea, after the country's transport ministry concluded in June that the current reading is inaccurate.

     The automaker announced the revision Tuesday, stating in a letter to car owners that the gas mileage rating will be changed from 14.4km per liter to 13.8 km. The move could deal a further blow to the company's brand image, which was marred by similar ratings downgrades on more than a dozen models in the U.S. in 2012.

     Hyundai plans to pay up to 400,000 won ($393.36) per customer to compensate for the higher fuel costs they incurred over five years, as well as for emotional distress.

     The amount is far less than the 1.5 million won per head demanded in a class action suit that about 1,500 vehicle owners filed in July. If the company pays that amount to owners of all 140,000 vehicles sold, the total cost would come to about 21 billion yen ($203 million).

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