Mercedes-Benz has agreed a $149.67m settlement with a coalition of US states, drawing a line under a protracted investigation into alleged manipulation of diesel emissions tests.
The multistate probe examined claims that the German carmaker installed software in hundreds of thousands of diesel vehicles that altered emissions performance during regulatory testing.
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Mercedes’ software allegedly allowed significantly higher pollution during normal driving.
The investigation was led by New York Attorney General Letitia James and eight other state attorneys general.
James said: “Today’s settlement holds Mercedes accountable, delivers millions of dollars to protect New York’s environment, and ensures that this company never again deceives the public about its emissions.”
The investigation was launched in 2020, following the conclusion of a related federal inquiry.
Serving on a nine-state executive committee, the involved offices examined in excess of 350,000 documents and conducted interviews with a large number of witnesses.
Investigators found that Mercedes marketed the affected diesel models as environmentally friendly, using descriptions such as “clean”, “green” and “ultra-low emissions”, and claiming to offer “the world’s cleanest diesel automobiles”.
The company promoted the vehicles’ supposed ability to convert pollutants into “pure, earth-friendly Nitrogen and water”.
The coalition states said the vehicles instead released far more pollution than permitted and did not perform as represented or certified.
Mercedes sold more than 200,000 diesel cars in the US that contained the implicated software from 2008 to 2017, with more than 19,000 of those vehicles registered in New York alone.
Under the settlement terms, the carmaker is required to pay $120m upfront to the coalition of states, of which $13.53m is earmarked for New York.
A further $29.67m in fines has been set aside conditionally and will be cut by $750 for every affected vehicle that Mercedes either brings into compliance with an authorised emissions repair, withdraws from sale, or repurchases.
The settlement also obliges Mercedes to pay $2,000 to qualifying owners and lessees whose vehicles undergo an Approved Emissions Modification.
Department of Environmental Conservation Commissioner Amanda Lefton said: “This multi-state settlement not only ensures accountability for bad actors using illegal emissions-cheating devices, it also importantly delivers more than $13.5m to New York to reduce harmful emissions and help eligible consumers pay for costly vehicle repairs.”
Mercedes is required to issue notices to qualifying customers explaining how they can take part in the programme and must provide an extended emissions warranty for vehicles that receive the modification.
The settlement imposes a series of conduct and reporting obligations on the manufacturer.
Mercedes is barred from selling or leasing diesel models that contain the emissions software flagged by the inquiry, and from issuing deceptive claims about how a vehicle performs in terms of emissions.
It may only describe a diesel vehicle as clean or low-pollution if the claim is accurate and supported by evidence.
The manufacturer is additionally required to adhere to obligations previously ordered by a federal court.
It is also required to provide regular reports to state regulators on which vehicles have been repaired or removed from service.
Further sanctions may be applied, contingent on how fully the company meets these requirements.
