Mercedes-Benz to pay $150M for cheating emissions tests
What's the story
Mercedes-Benz Group has agreed to a settlement of $149.6 million with nearly all US states over allegations of using "defeat devices" in its diesel vehicles. These devices were reportedly used to cheat emissions tests, a practice that has been at the center of the global "dieselgate" scandal for over a decade. The company confirmed the settlement but denied any wrongdoing in an official statement.
Accusations
Allegations of deception and competitive advantage
Delaware Attorney General Kathy Jennings accused Mercedes-Benz of deliberately lying to gain an unearned competitive advantage. She said, "This was not a technical error or a paperwork mistake. It was a lie." The company was accused of violating state environmental laws and statutes against unfair or deceptive trade practices by selling over 211,000 vehicles nationwide from 2008 to 2016 with software that manipulated emissions controls during tests but relaxed them during normal operations.
Emissions breach
Impact of defeat devices on vehicle emissions
The defeat devices allowed Mercedes vehicles to exceed legal limits for nitrogen oxide emissions, a pollutant that can cause respiratory illnesses and contribute to smog. Despite these violations, the company marketed its cars as more efficient and environmentally friendly than gasoline-fueled models. The settlement requires Mercedes to pay $120 million to attorney generals, with an additional $29 million payment suspended and potentially waived pending completion of a consumer relief program.
Settlement terms
Consumer relief program and compliance requirements
The consumer relief program will cover some 40,000 vehicles with defeat devices that weren't fixed or permanently taken off the road by August 1, 2023. Owners of these vehicles would get $2,000 per vehicle if they install approved emissions modification software and an extended warranty. The settlement also mandates Mercedes to comply with reporting requirements and refrain from any further unfair or deceptive marketing or sale of diesel vehicles.