Germany Orders Daimler to Recall 774000 Diesels in Europe

Daimler AG was ordered to recall 774,000 vehicles in Europe after two meetings with Germany’s top regulator failed to allay concerns about irregularities in the Mercedes-Benz maker’s diesel emissions.

The carmaker will upgrade engine software in Vito vans as well as the GLC sport-utility vehicle and C-Class sedan, Transport Minister Andreas Scheuer said Monday in a statement from Berlin, after meeting with Daimler Chief Executive Officer Dieter Zetsche for a second time in two weeks.

Dieter Zetsche in Berlin on June 11.

Photographer: Kay Nietfeld/dpa/AFP via Getty Images

The government is ordering “an immediate formal recall because of prohibited shutoff devices,” Scheuer said.

While a setback for a company that’s steadfastly denied cheating on diesel emissions, the software-focused recall means Daimler escaped more costly measures such as fines or a hardware fix. Speaking with reporters after the announcement, Zetsche said talks with the government had been “constructive.”

Government Pressure

Germany had ratcheted up pressure on Daimler to specify models and the number of vehicles that needed recalling to adjust their exhaust systems, criticizing the company’s piecemeal response to concerns about excessive pollution from its diesel vehicles. The recall comes nearly three years after Volkswagen AG’s cheating scandal.

Unlike VW, which admitted duping official emissions tests and faces costs of some 26 billion euros ($31 billion) in fines, buybacks and recalls globally, Daimler has rejected wrongdoing. As the diesel fallout rumbles on, German prosecutors also on Monday named Rupert Stadler, head of VW’s Audi unit, a suspect in the cheating scandal.

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