MERC'S MOVE

Daimler recalls three million diesels in Europe as an emissions-cheating probe heats up

Just one week after Germany’s Süddeutsche Zeitung reported that Daimler was officially under investigation for allegedly installing emissions-manipulating software in more than one million cars in the last 10 years, the company appears to be getting ahead of a potential backlash by announcing it will recall three million diesel vehicles across Europe.

“The public debate about diesel engines is creating uncertainty,” CEO Dieter Zetsche said in a statement on Tuesday. “We have therefore decided on additional measures to reassure drivers of diesel cars and to strengthen confidence in diesel technology.”

The company said as well as recalling and upgrading the affected diesels, it would also speed up the launch of its newest family of diesel engines. It said the recall would cost it about €220 million ($255 million). This is a drop in the ocean compared to Volkswagen’s dieselgate scandal, which is expected to cost VW about $18 billion in the end.

Bloomberg last week reported that the Stuttgart prosecutors are examining two motors that were installed in more than one million cars—including the Mercedes GLK 250 and GL 350 SUV—for possible emissions-cheating software. The German Transport Ministry demanded that Daimler executives attend a special hearing in Berlin the day after news of the probe broke last week, according to the Süddeutsche Zeitung.

“This is finally a proactive move to put something on the table and a solid attempt at getting out in front of the debate,” Bankhaus Metzler analyst Jürgen Pieper told Bloomberg. The cost of the recall is “extraordinarily low” and likely to rise, he said.

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