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Published: Tue, July 25, 2017
Economy | By Melissa Porter

German carmakers colluded on diesel controls, technology for decades

German carmakers colluded on diesel controls, technology for decades

European Union antitrust officials confirmed Saturday they had started investigating allegations of a cartel among a group of German carmakers. The cost to automotive companies of installing equipment to neutralize the fumes emitted by diesel vehicles is also increasing, making it hard to keep the price of the cars competitive. The mayors of Paris, Madrid, Athens and Mexico City announced plans to take diesel cars and vans off their roads by 2025.

The accusations of a cartel between BMW, Volkswagen and Daimler on diesel emissions equipment is another hammer blow to the reputations of the German carmakers and is not something they can afford after the humiliation that was the Volkswagen Dieselgate scandal. The German cartel office, or Bundeskartellamt, said in a statement Friday that it searched the auto companies past year as part of a probe into a possible steel cartel. Large tanks showing themselves to be more expensive, the groups would have opted together for small tanks, do not contain enough liquid to sufficiently decrease the air pollutants emitted. The commission said it would be "premature to speculate further".

Daimler tried to get ahead of things this week by recalling 3 million diesel vehicles in Europe for a free emissions-system adjustment.

According to Audi the move is meant to improve emissions in real-driving conditions "beyond current legal requirements". Audi, BMW and Mercedes-Benz, Porsche and Volkswagen have allegedly held secret and illicit meetings since the 1990s to coordinate vehicle technology, cost, suppliers, markets and strategy.

BMW also said Sunday it was offering owners of at least 350,000 diesel cars a voluntary software upgrade free of charge to incorporate "knowledge gained in the field over the last years to realize further improvements in emissions".

Germany's Federal Cartel Office tells Bloomberg that it doesn't comment on ongoing investigations, but confirmed that it had searched six car-industry companies in the past related to collusion concerns.

Audi, a division of Volkswagen Group, said it would update engine software on up to 850,000 diesel cars. Diesel engines, however, have higher nitrogen oxide emission which harms human health and sulfur which harms the environment.

"We compete to provide the best exhaust treatment systems, " the Munich-based automaker said in statement last afternoon.

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