Mercedes-Benz pays states nearly $150 million in emissions cheat settlement

The state of Hawaiʻi will receive $263,356 as part of a $149.7 million multistate settlement with Mercedes-Benz over allegations the automaker used “defeat devices” to bypass emission standards.

The Hawaiʻi Department of Commerce and Consumer Affairs Office of Consumer Protection joined a coalition of 50 attorneys general in the settlement with Mercedes-Benz USA LLC and Mercedes-Benz Group AG. The agreement addresses claims that the company violated state laws by marketing and selling diesel vehicles equipped with undisclosed software designed to cheat emissions tests.

According to the allegations, Mercedes manufactured more than 211,000 diesel passenger cars and vans between 2008 and 2016 that operated differently during testing than during normal use. The states alleged the devices allowed vehicles to exceed legal limits for nitrogen oxides, a pollutant linked to respiratory illness and smog.

“We must protect our environment for future generations and deliver certain consequences to those who break the law and pollute our air. Auto manufacturers have willfully been misleading the public about the level of harmful pollutants their vehicles were emitting,” said Mana Moriarty, executive director of the Office of Consumer Protection. “This settlement holds Mercedes-Benz accountable for past practices and prevents consumers from being misled in the future.”

Approximately 913 of the affected vehicles were sold or registered in Hawaiʻi. Under the terms of the settlement, Mercedes must install approved emission modification software at no cost to owners, provide an extended warranty, and pay consumers $2,000 per subject vehicle.

The settlement includes a $120 million immediate payment to the participating states. An additional $29.6 million may be waived if Mercedes completes a comprehensive consumer relief program for an estimated 39,565 vehicles nationwide that had not been repaired as of Aug. 1, 2023.

The agreement also prohibits Mercedes from further deceptive marketing regarding diesel emissions and requires the company to comply with new reporting requirements.

This action follows previous multi-million dollar settlements involving similar “cheat software” allegations against Volkswagen, Fiat Chrysler, and Robert Bosch GmbH.

The Department of Health and the Department of the Attorney General joined the Office of Consumer Protection as parties in the suit on behalf of the state. The settlement was led by attorneys general from nine states, including New York, Texas, and New Jersey, with Hawaiʻi and 40 other jurisdictions joining the coalition.