GM Korea Co., the South Korean unit of U.S. auto giant General Motors Co., has outlined a plan to compensate owners of its Cruze compact for exaggerated fuel economy claims, the government said Wednesday.

   The transportation ministry said it recently received a plan from the country's third-largest original equipment manufacturer, stating that the combined mileage for the 1.8-liter version of the compact front-wheel drive car did not meet the stated 12.4 kilometers per liter of fuel.

   The Cruze, sold under the Chevrolet badge, is one of 14 cars being tested by the government this year to see whether manufacturers' self-certification on mileage actually met the fuel economy on the open road.

   "The difference stood at around 9 percent, or a difference of more than 1 kmpl, which is beyond the permissible 5 percent leeway given by regulators," the ministry said.

   It said that in light of the discrepancy, GM Korea has said it will pay Cruze owners up to 420,000 won (US$400) to cover the difference between the stated and actual fuel economy and for causing inconvenience.

   Because the carmaker sold some 80,000 Cruzes in the country since 2008, the total amount of compensation could reach as high as 30 billion won.

   The car was previously called the Lacetti Premiere but adopted its current nameplate in March 2011.

   Despite, GM Korea's coming forward with the mileage discrepancy, the transportation ministry said it plans to slap fines on the carmaker for false reporting that could impair the judgment of consumers when they are picking a new car.

   Under South Korean law, the fine cannot exceed 1 billion won, although the ministry did say it will make allowances for the carmaker coming clean before actual tests have been carried out on the car.

   Seoul has already stated that Hyundai Motor Co.'s Santa Fe and Ssangyong Motor Co.'s  Korando Sports did not meet revised and updated state fuel economy standards. Hyundai has taken steps to compensate consumers, while Ssangyong has yet to announce what actions it will take. (Yonhap)