UPDATE 1-GM SUV compensation program will cost about $100 mln - source

(New throughout, adds details, Canadian program)
By David Shepardson
WASHINGTON, May 20 (Reuters) - General Motors Co (NYSE:GM) GM.N said
on Friday it will give debit cards or extended warranties to
146,000 North American owners of new sport utility vehicles to
compensate them because the automaker overstated the vehicles'
fuel efficiency.
The program covers about 135,000 U.S. owners and 11,000 in
Canada, GM said.
GM said most of the debit cards would be worth $450 to $900
for U.S. owners of 2016 SUVs and $1,000-$1,300 Cdn for Canadian
owners. The maximum any owner would get is $1,500.
The largest U.S. automaker said the program would not have a
material impact on financial results. A source not authorized to
discuss the issue told Reuters the program would cost GM around
$100 million.
On Wednesday, Reuters and others reported GM was planning
the program after the mileage error forced it to temporarily
halt sales of about 60,000 new 2016 U.S. SUVs. GM resumed sales
once the correct fuel labels arrived at dealerships.
"We want all of our customers to have a great ownership
experience, so we designed this reimbursement program to provide
full and fair compensation in a simple, flexible and timely
manner," GM spokesman Jim Cain said Friday.
GM this week blamed the 1-2 mile-per-gallon overstatement on
improper calculations that did not include data from tests on
new emissions-related hardware in the 2016 Chevrolet Traverse,
GMC Acadia and Buick Enclave SUVs.
The U.S. Environmental Protection Agency has asked GM to
provide testing data.
GM said buyers may choose a debit card or a
48-month/60,000-mile extended warranty plan designed for
high-mileage customers and those who plan to keep vehicles for
an extended period. Customers who leased vehicles will be
offered a pre-paid debit card.
GM said it based reimbursement on the EPA formula used for
window labels: "a fuel price of $3 per gallon and 15,000 miles
of annual driving for five years."
GM sold another 40,000 SUVs to rental car companies and
commercial and government fleets. GM said it will work out
compensation individually with government and commercial buyers.
On Tuesday, a Florida owner of a 2016 SUV filed a
class-action suit against GM on behalf of owners who bought
vehicles with overstated fuel economy ratings.
In April, Mitsubishi Motors Corp 7211.T admitted to
overstating fuel economy of four models sold in Japan. In 2014,
Korean carmakers Hyundai Motor Co 005380.KS and affiliate Kia
Motors Corp agreed to pay $350 million in penalties to the U.S.
government for overstating fuel economy ratings in about 1.2
million vehicles, and to compensate owners.