BMW, Volkswagen and Daimler charged with collusion by EU over car emissions scandal

Latest blow to industry comes after Volkswagen admitted to installing software in engines to cheat US emissions tests

German car manufacturers Volkswagen, Daimler and BMW have been charged by the European Commission with colluding to block the rollout of clean emissions technology.

The companies have 10 weeks to respond to the EU antitrust regulator and could face fines running to billions of Euros if their explanations are rejected.

Between 2006 and 2014, the commission suspects that the “circle of five” car manufacturers – including VW’s Audi and Porsche divisions – colluded to limit, delay or avoid the introduction of selective catalytic reduction systems (SCRs) and Otto particle filters.

The SCR systems are used to reduce nitrogen dioxides from diesel car emissions, a toxic particle linked to 71,000 premature deaths across Europe in 2013, according to the EU’s environment agency.

The Otto particle filters are used to control exhaust gases from petrol cars and limit particulate emissions, which are also associated with tens of thousands of deaths a year.

The announcement comes two years after raids on the car manufacturers following an investigation by Der Spiegel alleging the companies had met in secret in the 1990s to coordinate a response to diesel emissions.

The EU’s competition commissioner, Margrethe Vestager, said: “Daimler, VW and BMW may have broken EU competition rules. As a result, European consumers may have been denied the opportunity to buy cars with the best available technology."

Bas Eickhout, a Green MEP, added that the car makers’ actions put a brake on innovation.

The investigation’s initial findings risks further denting the car industry’s reputation after Volkswagen admitted to using software in diesel car engines to cheat on US emissions tests four years ago.

The company has set aside €27.4bn (£23.6bn) for fines, settlements, recalls and buybacks following the scandal.

The EU probe is separate from other ongoing legal procedures against car makers for allegedly breaching environmental law.

BMW said discussions among engineers were meant to improve exhaust gas technologies and that the whole industry was aware of these talks. It said they did not involve any secret agreements or intend to hurt customers.

Volkswagen said it was cooperating with the EU and would issue a statement once it has reviewed the EU investigation.

Daimler also said it was cooperating with the EU and does not expect to receive a fine.

EU anti-trust fines can be as high as 10 per cent of a company’s global turnover.

In 2016 and 2017 the commission fined six truck makers €3.8bn (£3.2bn) after it found they had colluded on pricing, the timing of introduction of emissions technologies and the passing on of costs for emissions compliance to customers.

In response to news that the commission was investigating the four car manufacturers last year, Ugo Taddei, a lawyer for ClientEarth said evidence of the industry’s “central role” in the air pollution crisis was building.

“Yet, national authorities keep folding under the pressure of the auto lobby and dragging their feet rather than ordering corrective actions," he said. “These latest revelations tell us that the technology has been there for many years to reduce harmful emissions from vehicles, but the industry has been resistant to change. And this is still clearly going on.”

Additional reporting by agencies