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Aug. 13, 2020, 1:11 p.m. EDT

Daimler to pay more than $2B in US emissions case

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By Pietro Lombardi

Daimler AG will pay around $1.5 billion as part of agreements it reached with U.S. authorities to settle proceedings related to diesel emissions.

The German car maker said Thursday it has reached an agreement with various U.S. authorities to settle civil and environmental claims related to emission control systems of roughly 250,000 diesel passenger cars and vans in the U.S.

Moreover, the company has reached an agreement to settle a class action over the same issue.

Daimler expects the costs of the settlement to be around $1.5 billion. On top of that, around $700 million will be earmarked to settle the class action.

"Daimler estimates further expenses of a mid three-digit-million euros amount to fulfill requirements of the settlements," it said.

The car maker said it has enough provisions to cover these costs.

"The company has cooperated fully with the U.S. authorities and continues to do so," it said.

The U.S. authorities involved in the agreement are the Environmental Protection Agency, the California Air Resources Board, the Environment and Natural Resources Division of the U.S. Department of Justice, the California Attorney General's Office, and the U.S. Customs and Border Protection.

The agreements, which are subject to approval by the relevant authorities, will have an impact on cash flow in the next three years, with the main hit expected in the next 12 months, Daimler said.

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