Economy

Germany hits Mercedes with mass diesel recall

Germany hits Mercedes with mass diesel recall

With the new recall, Daimler is escaping massive fines of approximately $4.4 billion (estimated).

This latest development follows news a year ago that saw Daimler accused of selling over one million cars with excess emissions in Europe and the USA, following earlier reports in the German media.

A spokesman for the company declined to comment on specifics regarding the case, but said: "We are cooperating to a full extent and transparently with the KBA and the federal transport ministry".

Daimler, the parent company of Mercedes-Benz, has been ordered to recall some 774,000 vehicles in Europe after German transportation officials allegedly found up to five illegal emissions control devices on a handful of cars.

In a statement issued on Monday, the German transport ministry said: 'The government will order 238,000 Daimler vehicles to be immediately recalled Germany-wide because of unauthorised defeat devices'.

The main problem models were the big-selling C-Class 220d sedan and wagon, the Vito van and the GLC 220d coupe SUV, the KBA confirmed.

Mercedes-Benz GLC-Class SUV
Enlarge ImageMercedes-Benz is recalling 774,000 diesel models in Europe including examples of its GLC-Class SUV. Mercedes-Benz

"In addition, Daimler explains that with maximum processing speed and in cooperative transparency with the authorities, the applications in the engine control system objected to by the federal government are eliminated", Federal Transport Minister Andreas Scheuer said in a statement.

The emissions scandal has hung over the German auto industry since September 2015, when Volkswagen admitted to using software that could tell when a diesel vehicle was being tested and temporarily lower its toxic emissions to pass USA regulations.

The software cheat in question is the much-reported "Thermal Switches" which Daimler, Opel, PSA and others have used as a loophole to pass NOx emission requirements at laboratory temperatures.

The reports allege that two engines (OM 642 and OM 651) come with devices that shut down emissions controls under certain situations.

"We don't see any evidence that Daimler was designing software to deliberately cheat on emission testing", he said.

Evercore ISI analyst Arndt Ellinghorst predicted the costs for the required software update for Daimler would be less than 100 million euros.

More news: Putin criticizes U.S. withdrawal from Iranian nuclear deal


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