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VW, BMW, Daimler face EU probe over collusion

Brussels

VOLKSWAGEN AG, Daimler AG and BMW AG face a European Union antitrust probe into suspected collusion that could have stalled the development and roll-out of clean-emissions technology for cars.

The probe, which could lead to heavy fines, focuses on technical talks to develop selective catalytic reduction systems to reduce nitrogen-oxides emissions from diesel cars and "Otto" particulate filters for gasoline engines.

The EU said it had no indications the carmakers coordinated on illegal defeat devices to cheat regulatory testing or on developing other technology - a wider scandal that has tarnished the reputation of VW.

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"These technologies aim at making passenger cars less damaging to the environment," EU Competition Commissioner Margrethe Vestager said in an emailed statement. "If proven, this collusion may have denied consumers the opportunity to buy less polluting cars, despite the technology being available to the manufacturers."

The probe represents another challenge for the German auto industry, which is grappling with fallout from revelations of VW's diesel-cheating and the disruptive shift to self-driving, electric cars. Allegations emerged last year in Germany's Spiegel magazine, which reported that VW, Daimler and BMW met starting in the 1990s to coordinate activities related to vehicle technology, costs, suppliers and strategy as well as diesel emissions controls.

Volkswagen has been cooperating with the European Commission and will continue to do so, the company, whose namesake VW as well as Audi and Porsche have been implicated in the cartel probe, said in an emailed statement.

"This initiation of proceedings is a normal, process-driven step that Volkswagen has been expecting," the carmaker said.

In the coming months, VW will have to deal with at least a half-dozen court actions stemming from its use of software to cheat on diesel emission tests.

After setting aside some US$32 billion to settle lawsuits and pay damages, VW faces more than US$10 billion in further claims from disgruntled investors and customers - as well as untold damage to its reputation as top executives risk being hauled before the courts. BLOOMBERG