Daimler probes cheating claims
DAIMLER is conducting a thorough investigation into allegations of diesel cheating as the German carmaker seeks to burnish the technology’s battered reputation amid an onslaught of negative news for an industry reeling from scandals.
The maker of Mercedes-Benz cars is keen to shore up diesel, which powers many of its lucrative sport utility vehicles and big sedans as well as its trucks, vans and buses.
The Stuttgart, Germany-based manufacturer is counting on diesel while it invests in lowering the price and increasing the range of battery-powered cars to meet increasingly tough environmental regulations.
“Diesel is worth fighting for,” chief executive Dieter Zetsche said yesterday. Still, in his first public comments since allegations of decades-long collusion with other German carmakers surfaced last week, he largely steered clear of the topic beyond bemoaning the string of bad news hitting the industry.
“The car industry is currently causing headlines, and they’re not good ones,” said Zetsche on a conference call with reporters. “I know a lot of people want more clarity now, but we can’t comment on speculation.”
The possible antitrust violations, which emerged from a report in Der Spiegel on Friday, opened another set of challenges, which also include the threat of diesel driving bans, industry wide recalls rooted in Volkswagen’s emissions-cheating scandal and heavy investment burdens to develop self-driving electric vehicles.
The UK is adding to the urgency by moving to ban sales of diesel and petrol cars by 2040 to combat air pollution, joining a similar plan in France.
Carmakers’ fight for diesel goes beyond holding on to a tried-and-tested technology. Until consumers finally buy electric vehicles, manufacturers need diesel as it generates about a fifth less greenhouse gases than comparable petrol engines.
Otherwise, the companies won’t meet Europe’s tightening emissions standards, and face paying fines as from the start of the next decade.
“We’re convinced, like the rest of the carmaking industry, that we’re headed toward electric mobility,” Zetsche said. “Until that happens, further reductions in CO2 we’ll be achieved through combustion engines, and here the diesel will play a significant role.”
Daimler said a week ago that it will recall more than 3 million diesel cars to upgrade exhaust-system software and will book the €220 million (R3.34 billion) in costs in the third quarter.
The cloud overshadowed the boon from buyers flocking to Mercedes’s new suite of sporty models. The group’s second-quarter profit rose 15 percent to €3.75bn, the company said yesterday.
Daimler shares declined 0.1 percent to €60.99 as of 11.03am in Frankfurt yesterday. The stock has dropped 14 percent this year, valuing
Daimler, BMW, VW and Ford are working together to establish a fast-charging network for electric cars.
the company at €65.3bn.
The profit gain came even with a 19 percent jump in firsthalf research and development spending as the manufacturer gears up to introduce a line of battery-powered cars.
Daimler said in March that it will release 10 new electric vehicles by 2022, three years earlier than a previous target, and the company is working to adapt an engine plant to produce batteries.
Carmakers’ shares dropped after Der Spiegel magazine reported that Daimler and Volkswagen informed authorities last year of discussions they’d had since the 1990s that also included BMW.
Over the weekend, the EU’s antitrust overseer confirmed that it is studying possible collusion among car producers, together with Germany’s regulator.
The allegations have appeared to strain relations in the car industry, as BMW on Sunday backed its diesel emissions technology and pointed the finger at rivals for not doing enough.
Zetsche said that he has not conferred with his BMW counterpart, Harald Krueger, in the past seven days, but that he expects existing co-operation pacts with peers to continue.
“I’ve not spoken to him and I’ve not received any information that on other levels there have been any signals of this speculative nature,” Zetsche said, referring to a report in the German daily Süddeutsche Zeitung that BMW has suspended talks on new projects.
Since about 2008, Daimler and its Munich-based rival have purchased significant volumes of components like windscreen wipers and tyres together, totalling some €2bn in annual orders.
Combining procurement helps lower prices and gain efficiency, and BMW had planned to expand the partnership. BMW declined to comment on the newspaper report.
Daimler, BMW, VW and Ford are also working together to establish a fast-charging network for electric cars along major European highways by 2020.
Audi, BMW and Daimler bought digital-mapping company Here in 2015 for €2.5bn, and have run it jointly since then.
Daimler chief executive Dieter Zetsche expects existing co-operation pacts with peers to continue.