April 22, 2016 / 2:01 PM / 2 years ago

German automakers to recall 630,000 cars to fix emissions

BERLIN/FRANKFURT (Reuters) - Volkswagen’s emissions-test cheating scandal spilled over to the wider car industry on Friday as Germany’s top manufacturers agreed to recall 630,000 vehicles to tweak diesel engine software technology blamed for causing high pollution.

As part of a widening clampdown on health-threatening nitrogen oxide (NOx) emissions, Porsche, Volkswagen, Opel, Audi and Mercedes diesel cars will be recalled to fix engine management systems, a German government official said.

BMW, which invested in fuel saving technologies earlier than most rivals, was not part of the recall, the official said.

Engine management systems and software have come under scrutiny ever since Volkswagen (VW) in September admitted it had installed programmes which cheat diesel emissions tests.

Late on Thursday, VW agreed a framework settlement with the U.S. Justice Department, state of California, the U.S. Environmental Protection Agency and Federal Trade Commission, as well as lawyers for car owners who filed class action civil lawsuits.

Though no other carmaker has been found to use so-called “defeat devices”, regulators and environmental groups have criticised the widespread use of engine management systems which switch off emissions treatment in order to improve engine performance and increase the interval between services.

European tests have found several carmakers using a legal loophole allowing them to throttle back emissions treatments under certain circumstances, ostensibly to protect engines.

Following extensive testing, the German motor transport authority KBA questioned whether the use of this loophole was always justified and necessary, the German official said.

DAIMLER

Separately, Mercedes-Benz parent company Daimler said late Thursday the U.S. Department of Justice (DoJ) had asked it to investigate its emissions certification process for vehicles.

Daimler finance chief Bodo Uebber declined to elaborate on what prompted the investigation when the company published earnings for the first three months of the year on Friday.

“We cannot go into details,” he told reporters as Daimler said first-quarter operating profit fell 9 percent, hit by launch costs for its new E-Class and currency swings.

Daimler said on Thursday it was cooperating with U.S. authorities. “Daimler will consequently investigate possible indications of irregularities and of course take all necessary actions,” it said.

Daimler had previously told analysts at BNP Paribas it had suffered delays in getting emissions certification for some variants of the GLS and GLC sports utility vehicles, a function of additional scrutiny in the aftermath of the VW scandal.

It was not immediately clear what had triggered the DoJ intervention. The U.S. Environmental Protection Agency said in February it had requested information from Daimler in light of a lawsuit filed by U.S. Mercedes owners but had not opened an official investigation.

Daimler on Friday reiterated it considered the class action suits to be without merit, adding the company would defend itself with all available legal means.

Rival VW has been plunged into deep crisis by its diesel emissions scandal. Seeking to move on, it has proposed fixing or buying back about half a million polluting cars in the United States at a likely cost of more than $10 billion.

There are still many questions hanging over VW, however, including who was responsible for the test cheating and whether customers elsewhere will be offered the same compensation that will be available in the United States.

A spokesman for the German justice ministry said on Friday VW customers in the country should not necessarily expect the same deal.

In a further sign of a widening clampdown, facilities run by France’s Peugeot Citroen and Japan’s Mitsubishi Motors Corp were searched on Thursday by local officials investigating fuel efficiency and pollution levels.

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