Attorney General Jason Miyares has announced that Virginia will receive over $1.5 million as part of a nationwide settlement with Mercedes-Benz USA and Daimler AG. The $149,673,750 settlement addresses allegations that the companies violated state laws by marketing, selling, and leasing vehicles equipped with emissions defeat devices intended to bypass legal emissions standards.
According to the coalition of 50 attorneys general, Mercedes manufactured and distributed more than 211,000 diesel cars and vans from 2008 to 2016 that contained software designed to manipulate emission controls during testing. Outside of testing conditions, these controls were reduced, resulting in nitrogen oxides emissions that exceeded legal limits. Nitrogen oxides are known pollutants linked to respiratory issues and smog formation.
Authorities allege that Mercedes concealed these devices from regulators and consumers while promoting the vehicles as environmentally friendly and compliant with regulations. The use of such defeat devices was reportedly motivated by a desire to meet design goals like improved fuel efficiency and lower maintenance without adhering to emission standards.
Under the terms of the agreement, Mercedes-Benz USA and Daimler AG will pay $120 million upfront to the states involved. An additional $29,673,750 may be waived if the companies complete a consumer relief program estimated at over $200 million in value.
The consumer relief program applies to about 39,565 affected vehicles still on U.S. roads as of August 2023. Mercedes is required to install approved emission modification software at no cost for these vehicles. Consumers participating in the program will also receive an extended warranty and a payment of $2,000 per vehicle.
The settlement mandates reporting requirements for Mercedes-Benz USA and Daimler AG and prohibits further unfair or deceptive practices related to diesel vehicle marketing or sales.
This action follows earlier settlements between state authorities and other automakers accused of similar conduct. Volkswagen agreed to pay $570 million in 2016; Fiat Chrysler paid $72.5 million in 2019; Bosch settled for $98.7 million in 2019.
Connecticut, Delaware, and Maryland led the investigation with assistance from several other states including Alabama, Georgia, New Jersey, New York, South Carolina, Texas—and participation from all other states plus Washington D.C., Puerto Rico, and several territories.
“Today’s settlement requires Mercedes-Benz USA and Daimler AG to pay $120 million to the states upon the effective date of the settlement. An additional $29,673,750 will be suspended and potentially waived pending completion of a comprehensive consumer relief program,” according to Attorney General Jason Miyares’ office.
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