Published: Thu, June 14, 2018
Economy | By Shawn Conner

Mercedes recalls hundreds of thousands of diesel cars over emissions "defeat devices"

Mercedes recalls hundreds of thousands of diesel cars over emissions

The affected compression ignition engine-powered vehicles are sold only in Europe.

When asked if the defeat devices were potentially installed in 220d-badged versions of the cars sold here, Mercedes-Benz Australia spokesman David McCarthy said: "We do not now know".

As part of the German recall, engine software will be upgraded in Vito vans as well as the GLC Sports Utility Vehicle (SUV) and the popular C-Class.

He said over 770-thousand of the diesel models in Europe have software that turns off emissions controls under certain conditions.

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In this case, affected about 11 million vehicles worldwide.

"The government will order 238,000 Daimler vehicles to be immediately recalled Germany-wide because of unauthorised defeat devices", the German transport ministry said in a statement.

The challenge that auto makers are facing in Europe is the liberal interpretation of rather loose European regulations with regard to vehicle emissions. German authorities have been bearing down on the auto maker for its piece-meal responses to allegations that its diesel cars were emitting higher than acceptable pollutants.

It's now unclear how many models in the United Kingdom are impacted.

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However, Daimler is still denying that it has used "illegal switch-off devices" and has announced it would go to court if necessary to prove it's not doing anything illegal. This week Dr Zetsche claimed Daimler had found a technical solution to update the software on the offending cars, which he hoped would help the company to avoid a fine.

Daimler has pledged to work on removing the software and to cooperate with authorities, the ministry said.

'For the existence of the relevant test cycle NEDC, the specific programming in question is not required'. Arndt Ellinghorst, an analyst with Evercore ISI in London, told Bloomberg that there's no evidence that Daimler was actively designing the software to cheat regulations and emission rules in the European Union.

Unlike VW, which admitted duping official emissions tests and faces costs of some 26 billion euros in fines, buybacks and recalls globally, Daimler has rejected wrongdoing.

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'Overall, this outcome should de-risk the stock'.

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