Compensation for Theft Victims Forms Majority of the Settlement
Hyundai has swiftly resolved a class-action lawsuit related to a viral TikTok car theft challenge by agreeing to a settlement worth up to $200 million. The settlement aims to provide compensation to approximately 9 million Hyundai and Kia owners in the United States. Out of the total amount, around $145 million will be used to cover out-of-pocket losses incurred by customers whose stolen or damaged vehicles were not covered by insurance. Hyundai and Kia will also cover insurance deductibles, increased insurance premiums, and other associated expenses.
The settlement encompasses a wide range of Hyundai and Kia vehicles released between the years 2011 and 2022, including popular models like the Elantra, Santa Fe, Tucson, and the 2011-2014 Genesis Coupe. Owners who experienced a complete loss of their vehicle will be eligible for compensation of up to $6,125, while damages to the vehicle and personal property will be compensated up to $3,375.
To address the security flaw highlighted by the TikTok challenge, Hyundai and Kia have already released a dealership-installed update. This update enhances theft prevention for specific models, such as the 2017-2020 Elantra, 2015-2019 Sonata, and 2020-2021 Venue, by disabling push-to-start functionality and extending the alarm system. By June, eligible vehicles will receive the necessary updates. As part of the settlement, Hyundai and Kia will also offer up to $300 to assist drivers in purchasing anti-theft devices. Additionally, they have provided "tens of thousands" of free steering wheel locks to affected customers and offered AAA insurance options to those who faced difficulties in maintaining coverage.
The "Kia Challenge" gained popularity in mid-2022 when TikTok user "Kia Boyz" shared videos demonstrating how Hyundai and Kia vehicles without anti-theft immobilizers could be hot-wired using USB cables. Following the viral challenge, incidents of theft involving these vehicle makes surged, leading to the involvement of the National Highway Traffic Safety Administration. Disturbingly, at least 14 crashes and eight deaths were linked to the consequences of these viral clips.
While the settlement resolves the high-profile court battle with owners, it may not eliminate potential lawsuits from cities like Cleveland, San Diego, and Seattle. This incident underscores the significant cost of security issues in the age of social media, as even minor vulnerabilities can quickly become widely known.