Daimler AG: Diesel Emissions Scandal(2016 - present)

Daimler AG: Diesel Emissions Scandal(2016 - present)

Daimler AG's logo

Controversy
In 2016 the Department of Justice began looking into the corporation Daimler AG over its subsidiary company Mercedes-Benz due to reports that emission dodging software was installed on its vehicles. There have been suspicions that ever since 2016, Daimler AG has tried to evade the U.S. emission standards. These suspicions arose when several customers had sued Daimler AG over the claims that the emission cheating software had been installed on their vehicle. In response to independent reports of emission cheating software, Mercedes-Benz issued a voluntary recall of over 3 million diesel cars in 2017. The vehicles were emitting excess nitrous oxides which are harmful to the environment and were below the regulation requirements. These reports showed that only 35% of nitrous oxides were removed from emissions compared to Mercedes-Benz’s claim that 95-99% of nitrous oxides were removed. This wrongdoing of Mercedes-Benz would violate the United States Clean Air Act and also would cause the company to be guilty of false advertising claims that their vehicles have low emissions. Customers that purchased diesel Mercedes-Benz cars were misled into purchasing a luxury car that did not hold up to its price tag.

Mercedes-Benz four-cylinder in-line diesel engine

Mercedes-Benz attempted to cheat emissions test with a series of programs installed in the vehicle control system. These programs were created in order for diesel Mercedes-Benz cars to comply with the current U.S. emissions test. One of the programs installed was Bit 15. This program caused diesel Mercedes-Benz cars’ exhaust after treatment to switch out of clean mode after the car drove 26 kilometer. Another program used to pass emission test was Bit 14. This program switched the car into dirty mode under present periods of time and certain temperatures and allowed Mercedes-Benz cars to pass the FTP-75 warm test cycle. An additional program installed was Bit 13. This program directed the diesel engine to switch dirty mode after emitting 16 grams of nitrogen oxide. Mercedes-Benz is also suspected of installing the Slipguard Function. This function can detect when a car is being tested on a rolling road and then modifies the amount of AdBlue solution into the SCR system so that the emissions are cleaner. Emails have also been cited of Daimler engineers questioning whether these software functions were legal. These programs and softwares are similar to the softwares used by Volkswagen in their 2015 diesel-gate scandal. Against all reports, Daimler AG continues to deny all claims of any apparent corrupt actions made by the company.

Individualism
According to  Friedman's Individualist Theory, a business's main goal is to maximize profits for the shareholders and owner(s) while being ethical and abiding by the law. When analyzing this case from an Individualist perspective, Daimler AG acted unethically by cheating emissions test. In the pursuit of profits, Daimler AG installed programs into their diesel cars for the U.S. market so that they could pass the U.S. emissions test. By doing this, Daimler also violated the United States Clean Air Act. Daimler however did act ethically by issuing a voluntary recall of over 3 million diesel cars in 2017. This action did not violate the ethical theory of Individualism since caused a negative impact on the company financially in order for Daimler to fix their mistakes.

Utilitarianism

A four-cylinder Daimler diesel engine on a factory production line

According to Utilitarianism, a business is being ethical if it promotes all-around happiness for all parties involved. A Utilitarian evaluating this case would deem Daimler's actions to be unethical for most of the stakeholders. Consumers were unhappy since their Mercedes-Benz cars were emitting far too many nitrous oxides into the environment; however the recall did solve this for the most part. The shareholders of Daimler AG would be unhappy since the recall of over 3 million vehicles caused the company to lose profits. This would make the employees unhappy since a loss of profits could correlate with the loss of jobs for many. The general public would also be unhappy because of the diesel Mercedes-Benz cars were emitting too many nitrous oxides and thus negatively affecting the environment by causing acid rain and aiding global warming.

Kantianism
According to Immanuel Kant's ethical theory of Kantianism, a business should act rationally while making business decisions. Also, you should never treat another person as a means of getting to the end. What this means is that you should never take advantage of someone and or do something without the person's full understanding and permission. When analyzing this case under Kantianism,  Daimler was not being ethical. Daimler sold modified cars to consumers that had increased emissions without the consumers knowledge that they were modified. Daimler was also not being honest with emissions testers and the U.S. government since they installed software to intentionally cheat emissions test. Also, Daimler was not being ethical the general public since they were intentionally causing their cars to pollute more nitrous oxides into the environment. Because of these reasons, Daimler was not following the formula for Humanity.

Virtue Theory
The ethical theory of Virtue Theory is based on the four characteristics of courage, honesty, temperance, and justice. Daimler partially violated this theory because of their lack of honesty. To this day, Daimler continues to deny any wrongdoings and they also claim that these reports of faulty emissions were created to harm the company. Joerg Howe, a spokesperson for Daimler AG says that the reports have “selectively been released in order to harm Daimler and its 290,000 employees.” Contrary to their lack of honesty, Daimler had the courage to do the right thing and voluntarily recall over 3 million of their diesel vehicles. However, Daimler did not represent any temperance. Emails have been cited of Daimler engineers questioning whether these software functions in the diesel Mercedes-Benz cars were legal but still Daimler decided that they should be installed anyways. Daimler does somewhat represent a virtue of justice since they voluntarily recall over 3 million of their diesel vehicles but yet they still deny any initial wrongdoings. When taking the four of the ethical theory's into account, Daimler has certainly acted unethically by cheating emissions test.

Work Cited

“Daimler, VW Face Thousands of Further Recalls over Emissions Cheating: Report.” The Local, 16 Feb. 2018, www.thelocal.de/20180216/daimler-vw-face-more-recalls-over-emissions-cheating-report.

Feb 26, 2018                                                    Greg Kable |                                                       WardsAuto. “Daimler Suspected of Using Diesel Defeat Device.” Daimler | Mercedes-Benz Parent Linked to Diesel Defeat Device | Engines Content from WardsAuto, wardsauto.com/engines/daimler-suspected-using-diesel-defeat-device.

Läsker, Kristina, and Spiegel Online. “Abgasskandal: US-Ermittler Belasten Daimler Schwer - SPIEGEL ONLINE - Wirtschaft.” SPIEGEL ONLINE, SPIEGEL ONLINE, 17 Feb. 2018, www.spiegel.de/wirtschaft/unternehmen/daimler-us-ermittler-belasten-autokonzern-im-diesel-skandal-a-1194095.html.

Markey, Edward, and Richard Blumenthal. “Mercedes Benz Emissions Evading Software.” Https://Www.markey.senate.gov/Imo/Media/Doc/2018.02.23%20DOJ%20Mercedes%20Benz%20emissions%20evading%20software.Pdf, 23 Feb. 2018.

Taylor, Edward, and Emma Thomasson; “Software May Have Helped Daimler Pass U.S. Emissions Tests: Report.” Reuters, Thomson Reuters, 18 Feb. 2018, www.reuters.com/article/us-daimler-emissions/software-may-have-helped-daimler-pass-u-s-emissions-tests-report-idUSKCN1G20B2.