VW, BMW face fine for emissions tech

Germany’s three largest car makers colluded illegally to limit the effectiveness of their emissions technology, leading to higher levels of harmful diesel pollution, European antitrust authorities said Thursday.

Volkswagen and its Porsche and Audi divisions must pay €500 million, or $590 million, and BMW will pay €373 million, or $442 million, as part of a settlement with the European Commission related to the cartel.

Daimler avoided a fine that would have totalled €727 million because it blew the whistle on the plot, the European Commission said.

The settlement is another blow to the image of the German automakers, who dominate the high end of the car market but have lost some of their lustre after Volkswagen admitted in 2015 that millions of cars it produced were fitted with software designed to dupe official emissions testers.

Daimler and BMW became tainted by the diesel scandal after the European Commission accused them in 2017 of illegally agreeing with Volkswagen on specifications for emissions treatment technology. Those accusations led to the settlement Thursday.

The European Commission, the European Union’s administrative arm, did not accuse the car makers of agreeing to deploy illegal technology. Rather, it said that they illegally agreed to deploy emissions technology that met minimum legal standards but was not as good as it could have been.

Among other things, the car makers agreed to limit the size of the tanks used to hold a chemical that neutralises harmful nitrogen oxides in diesel emissions, the commission said.

Larger tanks would have done a better job reducing pollution but taken space that companies preferred to use for audio speakers or other amenities.

“For over five years, the car manufacturers deliberately avoided to compete on cleaning better than what was required by EU emission standards,” Margrethe Vestager, the EU’s competition commissioner, said in a statement. “And they did it despite the relevant technology being available.”

Volkswagen has since paid well over $20 billion in fines and legal settlements related to its diesel emissions cheating. Daimler admitted last year that its Mercedes-Benz cars were also programmed to cheat on emissions tests and paid $2.2 billion as part of a settlement with US authorities.

Sales of diesel vehicles, which once accounted for more than half of the new cars sold in Europe, have plummeted.

BMW portrayed the settlement as a vindication because it did not accuse the company of emissions cheating, which it has consistently denied. The fine was lower than expected, freeing up €1 billion that BMW had set aside to cover penalties related to the cartel case.

“Unlike some of its competitors, the BMW Group never considered reduced, illegal emission control,” the company said in a statement.