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After the huge diesel scandal of the VW group a few years ago, it seems that a door has been opened that does not seem to be able to close. Since then, countless investigations have been conducted by German and European regulators on all German brands, and not just on VW group brands. Some investigations have revealed that BMW and Mercedes-Benz are innocent of any kind of falsification of diesel emissions, but things have not seemed good to them now. European regulators have recently accused the three brands of collusion on their emissions.
According to this survey, BMW, Mercedes-Benz and various German brands of the VW group have collaborated to block the deployment of clean emissions technology.
"Daimler, VW and BMW may have violated the EU's competition rules. As a result, European consumers might have been denied the opportunity to buy cars with the best available technology, "said European Commissioner for Competition, Margrethe Vestager, in a recent statement.
BMW has not commented publicly for the moment, but said it would respond to the investigators. "The BMW Group will review the objections and information provided by the European Commission and will forward a response to the authority. Since this case concerns ongoing European Commission proceedings, the company will not comment on the content of the objections at this time. The examination of the statement of objections by the BMW group and any potential financial impact resulting therefrom is in progress, "said the Bavarian brand recently.
The Bavarians also said that their emissions technologies differed from those of other German brands: "The exhaust gas treatment technologies used by the BMW group are very different from other solutions in the market. The BMW Group has set its own route from the beginning, combining several emission control systems in its diesel vehicles. In vehicles where emission control is performed by SCR systems, a NOx storage catalyst is also installed. This translates into excellent emissions performance under real-life driving conditions, including against the competition. The combination of these two systems, combined with the recycling of exhaust gases in the engine, also means that the AdBlue consumption of BMW vehicles is very small compared to the competition. "
BMW admitted that there had been a meeting between automakers on how to get around certain emission restrictions, especially the PPF particle filter. However, the meeting was more focused on determining the limits and restrictions of this new particle filter with legislators and lawyers.
"The goal of the manufacturers and their associations was to participate in the discussion regarding the definition of future technically feasible limits. This is the usual practice in all sectors with respect to future regulatory proposals. In order to reach an industry position on the bill, the manufacturers first heard and then through the VDA and ACEA automobile associations. The results of the discussions have been incorporated into the consultations held by the Commission, "said BMW in its recent statement.
It does not look great for the major German brands, but we will have to see how all this will be done to make a final judgment.
UPDATE: Here's a new statement from BMW AG
As part of the ongoing antitrust proceedings, the European Commission today informed the BMW Group of a "Statement of Objections". The European Commission is investigating whether German car manufacturers have cooperated in technical working groups to restrict competition in the development and deployment of abatement technologies.
The BMW group will challenge the claims of the European Commission by all legal means, if necessary.
The Statement of Objections suggests to the BMW Group that it is likely ("more likely than unlikely") that the European Commission will impose a significant fine. According to international financial reporting standards, this results in an obligation to recognize a provision.
Consequently, following its examination of the statement of objections, the BMW group will record a provision which may exceed EUR 1 billion. This effect will have a negative impact on the financial results for the first quarter of 2019. The Company's review of the Statement of Objections and the file review will take some time. As a result, a final assessment of the financial impact is currently not possible.
As a result, the Automotive EBIT margin for the current year should be 1 to 1.5 percentage points lower than the previous target range of 6-8%.
The group's pre-tax profit forecasts for the current financial year remain unchanged (a significant drop compared with the previous year).
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