European officials are investigating German media reports that allege BMW, Daimler and Volkswagen worked together since the mid-1990s to hold down the prices of emissions equipment and other vehicle systems.
The three companies are also accused of working together to create diesel vehicles that would pass emissions tests in labs but actually be illegal on the roads.
The German Cartel Office is looking into the allegations to learn if the three automakers colluded to hold prices down, agree on technical specifications for German-based cars and to make as much money as possible from the sale of those vehicles.
Germany is the founding home to diesel vehicles and depends on a reputation of excellent workmanship and reliability to sell vehicles in the U.S. at premium prices, a reputation slipping away concerning diesel cars. In addition, about 800,000 Germans are employed by auto companies and more than half of German trade depends on the auto industry.
German media claim the three automakers conspired to use lax European emissions laws to manufacture, market and sell diesel vehicles that were illegal, all while controlling competition on new emissions technologies.
BMW came out swinging by saying the automaker did meet with other automakers about emissions systems, but those discussions involved the best way that customers could buy refills of the chemical needed for emissions systems. That chemical, AdBlue, is used to kill nitrogen oxide emissions by spraying the AdBlue from a tank installed in diesel vehicles.
According to German media, the three automakers decided years ago to limit the size of the AdBlue tanks solely to make more room in cars for features such as sound systems. The smaller tanks allegedly didn't provide enough of the chemical to keep neutralizing nitrogen oxide emissions, forcing the automakers to alter the emissions systems.
However, BMW claims that even with small chemical tanks, diesel vehicle emissions were within legal limits because BMW's cars use AdBlue in addition to catalytic converters to keep the cars "clean."
The allegation about small insufficient AdBlue tanks is nothing new to Volkswagen because the automaker already admitted Audi and VW diesel vehicles never contained enough of the chemical to neutralize nitrogen oxide emissions. Because of the emissions scandal created by Volkswagen, regulators learned the vehicles didn't even contain enough AdBlue to last from one oil change to the next.
German media say authorities and politicians typically take it easy on German automakers considering the number of workers employed by BMW, Daimler and Volkswagen. However, the landscape may be changing because German consumers are sick and tired of the emissions problems.
All the attention finally caused BMW, Daimler and Volkswagen to announce they would take action on more than five million diesel vehicles in Germany. The companies say they will give German consumers trade-in rebates on older vehicles, and newer vehicles will receive free upgrades.
The recalls will cost about $750 million, but much of Volkswagen's work has already been completed as part of original recalls ordered long ago when the emissions problems first surfaced.
Keep up with the latest Volkswagen emissions news here.