Photo: Daimler
German auto company Daimler said on Tuesday (September 24) it was fined €870 million by the Stuttgart public prosecutor on account of “negligent violation of supervisory duties.” The fine puts an end to years of investigative work pertaining to the carmaker using defeat devices in some of its cars.
The story began in 2017, when German prosecutors started looking into Daimler’s alleged habit of cheating emissions tests. At the time some 280,000 Mercedes-Benz C-Class and E-Class vehicles were under scrutiny forf having been fitted with software meant to cheat tests.
All the cars were recalled under order from the German Federal Motor Transport Authority (KBA), a decision the carmaker has been contesting ever since.
After receiving the fine, Daimler said it maintains its objections against the KBA but decided not to contest the prosecutor’s decision because “it is in the Company’s best interest to end the administrative offense proceeding in a timely and comprehensive manner.”
The fine announced today is smaller than the industry was anticipating (earlier rumors said the carmaker would be fined in excess of 1 billion euros), and apparently it will not impact Daimler in any significant way.
“For the third quarter 2019 the fine does not result in a relevant additional negative effect on earnings. The Company maintains its earnings forecast as published,” Daimler said.
With today’s announcement, Daimler joins the select club of carmakers (mostly from the Volkswagen group) to have been found in violation of rules and regulations, and fined. Over the past few years, Porsche was fined €535 million, Audi €800 million, and Bosch €90 million.
The absolute champion in this respect is the company that started all the Dieselgate conundrum, Volkswagen. In the U.S. the company was forced to pay $2.8 billion, while the Europeans charged them €1 billion.
Daimler says considerable quality control measures have been established now to avoid such things from ever occurring.
All the cars were recalled under order from the German Federal Motor Transport Authority (KBA), a decision the carmaker has been contesting ever since.
After receiving the fine, Daimler said it maintains its objections against the KBA but decided not to contest the prosecutor’s decision because “it is in the Company’s best interest to end the administrative offense proceeding in a timely and comprehensive manner.”
The fine announced today is smaller than the industry was anticipating (earlier rumors said the carmaker would be fined in excess of 1 billion euros), and apparently it will not impact Daimler in any significant way.
“For the third quarter 2019 the fine does not result in a relevant additional negative effect on earnings. The Company maintains its earnings forecast as published,” Daimler said.
With today’s announcement, Daimler joins the select club of carmakers (mostly from the Volkswagen group) to have been found in violation of rules and regulations, and fined. Over the past few years, Porsche was fined €535 million, Audi €800 million, and Bosch €90 million.
The absolute champion in this respect is the company that started all the Dieselgate conundrum, Volkswagen. In the U.S. the company was forced to pay $2.8 billion, while the Europeans charged them €1 billion.
Daimler says considerable quality control measures have been established now to avoid such things from ever occurring.
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