Daim­ler re­calls 3 mil­lion cars in lat­est blow to be­lea­guered diesel sec­tor

China Daily (Hong Kong) - - MOTORING -

Daim­ler moved to head off a grow­ing cri­sis over emis­sions con­cerns by vol­un­tar­ily re­call­ing more than 3 mil­lion Mercedes-Benz diesel ve­hi­cles in Eu­rope, mark­ing the lat­est blow to the tech­nol­ogy since Volk­swa­gen’s cheat­ing scan­dal erupted nearly two years ago.

The car­maker will ex­tend an on­go­ing up­grade of 250,000 com­pacts and vans to nearly ev­ery mod­ern Mercedes diesel on the road.

The plan, which in­volves a soft­ware patch and avoids com­plex com­po­nent fixes, will cost about 220 mil­lion eu­ros ($255 mil­lion), the Stuttgart, Ger­many-based com­pany said on Tues­day. The move comes against a back­drop of the mas­sive fines that be­set VW, and as Mercedes con­tin­ues to face in­ves­ti­ga­tions in Ger­many and the United States.

“This is about man­ag­ing diesel’s de­cline as gen­tly as pos­si­ble and to ge t a lit­tle bit of re­prieve,” said Arndt Ellinghorst, a Lon­don-based an­a­lyst with Ever­core ISI.

“That’s not go­ing to change the fun­da­men­tal di­rec­tion of the shift in tech­nol­ogy.”

Diesel, which pow­ers about half of the cars sold in Eu­rope ever y year thanks to taxes that make the fuel cheaper at the pump, has been in­creas- in­gly un­der at­tack since Volk­swa­gen ad­mit­ted to dup­ing reg­u­la­tors in Septem­ber 2015.

With the tech­nol­ogy cru­cial to Daim­ler’s strat­egy to meet tar­gets for lower car­bon-diox­ide emis­sions, the au­tomaker can ill af­ford to have diesel fur­ther sul­lied by doubts and al­le­ga­tions.

Ger­many’s Trans­port Min­istry, which said it will check ad­di­tional Mercedes mod­els for pos­si­ble emis­sions vi­o­la­tions, said the de­ci­sion sent a good sig­nal ahead of an Aug 2 na­tional task force meet­ing on diesel in Ber­lin.

The min­istr y will push for ward with a re­view of Mercede s c a r s a n n o u n c e d re­cently with the Ger­man mo­tor trans­por t author­ity, min­istry spokesman Se­bas­tian Hille told re­porters on Wed­nes­day.

As well as re­call­ing diesels with Euro-5 and -6 emis­sions stan­dards, the man­u­fac­turer also plans a “rapid” roll­out of a com­pletely new diesel en­gine fam­ily, the car­maker said.

The plan marks a con­cil­ia­tor y step af­ter Daim­ler vowed to fight ac­cu­sa­tions of cheat­ing by “all le­gal means” fol­low­ing a meet­ing with gov­ern­ment of­fi­cials in Ber­lin. T he cri­sis has clouded Daim­ler for months, with hun­dreds of po­lice of­fi­cers and prosec utors search­ing com­pany sites in May.

Ger­man author­i­ties have been scru­ti­niz­ing the car­maker for pos­si­ble emis­sions cheat­ing in­volv­ing two engines used by Mercedes, and Daim­ler is also the sub­ject of a US probe into al­legedly ex­ces­sive diesel emis­sions.

“This is fi­nally a proac­tive move to put some­thing on the ta­ble and a solid at­tempt at get­ting out in front of the de­bate,” said Juer­gen Pieper, a Fr a n k f u r t - b a s e d a n a l y s t with Bankhaus Met­zler.

Daim­ler ’s es­ti­ma­tion for the cost of the re­call, at about 70 eu­ros per car, is “ex­traor­di­nar­ily low” and could rise, he said.

Un­like Volk­swa­gen, which ad­mit­ted it de­ceived reg­u­la­tors, Daim­ler said it ad­hered to reg­u­la­tions that al­low ve­hi­cles to re­duce emis­sions con­trols to pro­tect a car’s en­gine.

Still, on­go­ing con­cerns about diesel in the af­ter­math of the Volk­swa­gen scan­dal h av e p r o m p t e d t h e h o m e states of Daim­ler, BMW and Audi to push for fixes on older mod­els to cut air pol­lu­tion.

The emis­sions crack­down e x t e n d s b e y o n d G e r m a ny, with France’s En­ergy Min­istry ear­lier this month say­ing the countr y would end the sale of gaso­line- and dieselpow­ered ve­hi­cles by 2040.

Paris, Madrid, Athens and Mex­ico City have all said they will ban diesel ve­hi­cles from their roads by 2025.

One of Daim­ler’s peers is pre­empt­ing these stricter rules.

Volvo Car Group said this month it will phase out ve­hi­cles pow­ered solely by fos­sil fu­els and of­fer only hy­brid or full-elec­tric mo­tors on ev­ery new model launched in 2019 or later.

PRO­VIDED TO CHINA DAILY

En­gi­neers check fa­cil­i­ties at BMW’s R&D cen­ter in Shenyang, Liaon­ing prov­ince.

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