The Transport Ministry said Monday that up to 774,000 Mercedes cars were affected by the switch-off technology in Europe, mentioning the already recalled Vito van as well as Daimler's GLC 220d and C 220d models. Last year, Mercedes-Benz retrofitted roughly 3 million cars with modified emissions controls to bring those cars into compliance with Euro 5 and Euro 6 regulations.
Five models in total are reported to be affected, including the volume-selling Mercedes C-Class - the UK's ninth most popular auto past year - and GLC SUV variants.
Mercedes-Benz is caught up in an emissions scandal of its own.
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German recall affects 220d versions of C-class and GLC, as well as some Vito vans.
"The federal government will order an immediate official recall because of illegal defeat devices", Scheuer said in a statement.
Dieter Zetsche, chairman of Mercedes' parent company Daimler, is believed to have met with the KBA to discuss their findings.
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"Daimler says the applications in the motor control software the federal government has found fault with will be removed at the greatest possible speed and in cooperative transparency with the authorities", Scheuer said.
In a statement posted on Twitter, the company said: "Daimler confirms the recall". Even today it insisted that "Open legal questions will be clarified in the objection proceedings". Marchionne's initial comments surrounding the disputed software centered around its inclusion to prolong the life of the engine, leading many to speculate that exhaust gas recirculation or temperature conditioning could be a culprit. Carmakers that use this system argue it's part of ensuring longevity rather than an attempt to cheat.
"The whole European vehicle industry is still stuck in this diesel quagmire, and everything that´s been done so far has done nothing to set it free", auto industry expert Ferdinand Dudenhoeffer of the vehicle research centre told AFP - pointing also to Italian and French automakers. VW was found to have so-called "cheat" devices installed in 11 million vehicles, which kept NOx levels low during laboratory tests but then switched off in normal driving.
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BMW recalled 12,000 diesel cars over the issue in February, while Porsche recalled 60,000 in May.