Daimler Settles in American Diesel Emissions Investigation
Daimler reached an agreement this week to settle U.S. proceedings related to an investigation into software that’s presumed to cheat diesel emissions tests. While not an admission of guilt, it’s going to cost the company a sizable $1.5 billion — which is a lot to spend on a simple misunderstanding.
After Volkswagen Group admitted to using engine management software designed to falsify emission testing data, there has been a target panted on the back of every other company operating within the auto industry. If VW could get away with such shenanigans for years, there’s reason to believe other carmakers may have engaged in similar behaviors.
Realists know this goes without saying. Increasingly stringent pollution regulations (especially on diesel motors) have become difficult for even the largest players to contend with, and are one of the reasons so many startups are focused entirely on building electric cars — stock market madness being the other.
Meanwhile, the automotive sector has enjoyed a long and storied history of acting badly, then shrugging it off. We couldn’t possibly count the number of times companies knowingly released bum components and then did everything in their power to avoid a recall, or fibbed on their mpg figures.
It’s just the way things are done. But that doesn’t mean everyone gets away with it.
“With the proposed settlements, the company takes an important step towards legal certainty with respect to various diesel proceedings in the United States,” Daimler said in a release on Thursday.
That’s nothing compared to what Volkswagen spent on Dieselgate — a sum that is bearing down on $40 billion USD after five years of litigation. But the Mercedes-Benz parent may not be out of the woods just yet. Daimler is already estimating an additional sum “of a mid three-digit-million [euro] amount to fulfill requirements of the settlements.”
It also expects a corresponding impact on the free cash flow of the business over the next 3 years. The brunt of this damage is expected to take place within the next 12 months, however.
[Image: Pixfly/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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They got off too lightly when comparing relatively to VW penalty. ( even with expected "additional sum of a mid three-digit-million [euro] amount to fulfill requirements of the settlements.” )
This is nonsense. EPA is simply shifting the blame for their incompetence on auto manufacturers. How in the world did those vehicles pass the tests!? How hard is it to design a real world emissions test? Pure government Incompetence. They should investigate the government bureaucrats who did not do their job.