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EU regulators raid auto giant BMW in German cartel case

The bloc's anti-trust officials have searched the offices of the premium carmaker this week in a probe investigating BMW and four other German automobile firms for suspected anti-competitive practices. BMW confirmed on Friday that EU anti-trust regulators had searched its offices in Munich this week, after the European Commission had earlier in the day refused to name the company involved. The EU, in its statement, said that the inspection related to the Commission concerns that several German car manufacturers may have violated EU antitrust rules that prohibit cartels and restrictive business practices. "Inspections are a preliminary step in investigations of suspected anti-competitive practices. The fact that the Commission carries out inspections does not mean that the inspected companies are guilty of anti-competitive behavior, nor does it prejudge the outcome of the investigation itself," the Commission added. A group of leading German carmakers including Volkswagen, Porsche, Audi, BMW and Daimler stand accused of holding illicit meetings since the 1990s to coordinate vehicle technology, cost, suppliers, markets and strategy. Daimler comes clean In July, German media reported that the cartel's secret working groups hashed out and decided the most important details of the auto business, including the inadequate size of the AdBlue tanks that could not adequately feed their diesel cars' exhaust treatment. One of the aims of the cartel was to avoid "an arms race" of AdBlue tank sizes. Meanwhile, the cartel case has turned into a race for who rats out whom first. Luxury carmaker Daimler on Friday confirmed it had applied for the status of principal witness in the EU probe. Daimler chief financial officer (CFO) Bodo Uebber told journalists that the application "principally concerns coordination in breach of anti-trust legislation which was discussed in the press a while ago." As it was yet unclear whether the EU opened an official investigation into the carmaker, Daimler saw "no need presently to make financial provisions for any possible fines," Uebber added. Rat-out-race According to German media reports, Volkswagen had also attempted to apply for the principal witness status. But Daimler was first in coming clean with Germany's and Europe's cartel watchdogs, and it could avoid a multi-billion euro fine. Volkswagen's voluntary declaration is dated July 4, 2016, but Daimler's came significantly earlier. Still, Volkswagen could get a rebate on the punishment. BMW, one of the least suspicious in diesel emissions fixing, is kept holding the bag. BMW has said from the outset that there is nothing unusual in working with other carmakers on certain components if they "do not contribute to differentiation of the two brands and are therefore not relevant to competition." According to EU law, the first co-operating co-conspirator in an anti-trust matter could walk away unpunished. The second one to break the silence would get a maximum 50 percent rebate, but only if "evidence with considerable value-add" will be delivered.

The bloc’s anti-trust officials have searched the offices of the premium carmaker this week in a probe investigating BMW and four other German automobile firms for suspected anti-competitive practices. BMW confirmed on Friday that EU anti-trust regulators had searched its offices in Munich this week, after the European Commission had earlier in the day refused to name the company involved. ... Read More »

German emissions scandal threatens to engulf Mercedes, BMW

German auto giant Daimler has made legal threats against an environmental group after it tested diesel cars. The results appeared to show that Mercedes and BMW models are also cheating on emissions tests. The environmental group Deutsche Umwelthilfe (DUH) and German state broadcaster ZDF presented the results of nitric oxide tests they had conducted on two Mercedes and BMW diesel models. They appeared to show similar discrepancies between "test mode" and road conditions that hit Volkswagen earlier this year, triggering one of the biggest scandals in German automobile history. In response to the report released on December 15, a law firm representing Daimler, which owns Mercedes, sent a letter to the DUH that read, "Should you in any way present the accusation that my client manipulated its emissions data, we will act against you with all necessary sustainability and hold you responsible for any economic damage that my client suffers as a result." In defiance of another threat by the Schertz law firm, the DUH published the threatening letter in full on its website. "We have been massively threatened two more times, demanding that we take down the letter - we have told them we won't," DUH chairman Jürgen Resch told DW on Wednesday. "For me it's a very serious issue, because in 34 years of full-time work in environmental protection, and dealing with businesses, I have never experienced a business using media law to try and keep a communication - and a threatening letter at that - secret. "How are we supposed to do our work as a consumer and environmental protection organization when industry forbids us from making public certain threats it makes?" an outraged Resch added. "I think the threat itself is borderline legal coercion." Dirty diesel - on the road In a short documentary broadcast on December 15, ZDF tested three diesel cars - a Mercedes C200 CDI from 2011, a BMW 320d from 2009, and a VW Passat 2.0 Blue Motion from 2011 - and showed that all three produced more nitric oxide on the road than they did in an official laboratory test. "The measurement results show that the cars behave differently on the test dynamometer than when they are driven on the road," said the laboratory at the University of Applied Sciences in Bern, Switzerland, which carried out the tests. The discrepancies researchers found were not small - while all three cars kept comfortably below the European Union's legal nitric oxide limit (180 milligrams per kilometer) in the lab, they all went well over the standard on the road, where the BMW recorded 428 mg/km (2.8 times its lab result), the Mercedes hit 420 mg/km (2.7 times its lab result), and the VW Passat reached 471 mg/km (3.7 times its lab result). No technical explanation Daimler did not respond to a request for comment from DW, but company spokesman Jörg Howe told the "taz" newspaper that the company could not verify the test result and pointed out that the cars had already been used. "No one can rule out that they weren't damaged or manipulated by a third party," he said. He also said outside temperatures, road surfaces, and wind could all have played a part in the discrepancy. A spokesman for BMW denied to ZDF that it used any kind of manipulative device. These answers did not wash with the DUH or with other experts. "I would expect discrepancies in the nitric oxide measurements, but not on this scale," Kai Borgeest of the Center for Automobile Electronics and Combustion Engines at Aschaffenburg University told ZDF. "Technically it is conceivable that the other manufacturers tested used 'power down' installations in different ways - in other words software functions that recognize the test cycle. That would be illegal." Resch of the DUH went even further. "Neither BMW nor Mercedes can explain to us how these massive discrepancies came about," he told DW. "Talking about the wind or that there were more people in the car could maybe explain a 3 percent difference - we've got 300 percent. These discrepancies can't be technically justified." Government silence Amidst all this new scrutiny, the German government is maintaining a stony silence. In response to a DW request, the Transport Ministry did not offer any other explanation for the test discrepancies. "The federal automobile authority [KBA] is currently carrying out tests on the affected Volkswagen diesel models as well as other major manufacturers of diesel cars ... the tests are taking place both on the 'roller' and on the street," the ministry said in a brief statement. The KBA said it could not comment as its press spokesman was not in the office. The lack of explanations is beginning to irk the environmental groups. "We haven't heard anything from the KBA about Mercedes. We haven't even got a confirmation from the German authorities that they have received our report," said Resch. "Interestingly enough - the EU Commission, the European Parliament, some foreign governments are all highly interested in our tests. "And we haven't had to take anything back, content-wise," he added. "In all the years, every single line of our statements are all still there unchanged - and you can bet that Renault, BMW, VW, Mercedes did everything they could to find a false statement or to claim that our measurements were wrong. They haven't done that." The new battle with Daimler is just the latest in the DUH's long campaign to try and get the German government to control emissions on German carmakers. "In February 2011, we named the VW Passat with extremely high nitric oxide emissions - that was whistleblower information that, of course, we could only show to the authorities," he said. "For over eight years, every year we've made a scandal of it. That's why we desperately need federal agencies that have the courage to investigate these things. "Now we're handicapped by this existence-threatening pressure - because a lawsuit would mean our insolvency," Resch said. "That does make me pretty angry, to be obstructed like this."

German auto giant Daimler has made legal threats against an environmental group after it tested diesel cars. The results appeared to show that Mercedes and BMW models are also cheating on emissions tests. The environmental group Deutsche Umwelthilfe (DUH) and German state broadcaster ZDF presented the results of nitric oxide tests they had conducted on two Mercedes and BMW diesel ... Read More »

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