Mercedes-Benz Pays $149.6 Million to Settle Allegations of Excess Diesel Emissions

Mercedes-Benz and Daimler AG have agreed to pay $149.6 million to settle allegations of installing secret devices in over 211,000 diesel vehicles.

Mercedes-Benz USA and its parent company, Daimler AG, have agreed to pay $149.6 million to resolve charges that the carmaker secretly inserted "defeat devices" in hundreds of thousands of vehicles to pass pollution testing, a union of attorneys general announced Monday. These secret devices enabled automobiles to pass emissions testing despite exceeding authorized nitrogen oxide limits in regular operation.

According to the coalition attorneys, between 2008 and 2016, the German carmaker installed software devices in over 211,000 diesel passenger vehicles and vans that enhanced pollution controls during tests but decreased them during normal operation. The devices allowed cars to exceed the legal limit for nitrogen oxides, a pollutant that may cause respiratory diseases and contribute to smog.

The states reported that Mercedes placed the secret devices because it could not meet design and performance objectives like as fuel economy while following to pollution requirements. The company reportedly concealed the devices from state and federal officials, as well as the general public, while selling the vehicles as "environmentally friendly" and emissions-compliant.

Back in 2020, Daimler AG and Mercedes-Benz USA have already agreed to pay $1.5 billion to the US government and California state regulators to resolve the allegations of emissions cheating.

Mercedes-Benz released a statement stating that the agreement agreed on Monday would resolve all remaining legal procedures related to diesel emissions in the United States, but the business continues to consider the allegations are false and rejects any accountability. The manufacturer has made "sufficient provisions" to cover the settlement costs, according to the statement.

The deal requires the company to pay the attorneys general $120 million, with an additional $29 million payment overdue and perhaps surrendered pending the implementation of a customer relief program. The settlement also requires Mercedes to comply with reporting requirements and refrain from future unfair or deceptive marketing or sales of diesel vehicles.

This effort of the states will include the approximately 40,000 automobiles with the devices that have not been fixed or permanently removed from the road by August 1, 2023. Owners of such automobiles would get $2,000 per vehicle if they installed certified emissions modification software and extended warranties.