German carmakers to recall 630,000 cars to check emissions software

German car manufacturers will recall 630,000 Porsche, Volkswagen Opel, Audi and Mercedes vehicles to fix diesel emissions management software, a German government official said on Friday, widening a clampdown on pollution in the wake of the Volkswagen scandal.

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German public broadcaster ARD reported that the recall was voluntary.

The recall is to ensure that a legal loophole which allows manufacturers to throttle back emissions treatment systems under certain circumstances is tightened to ensure lower levels of pollution going forward, according to the government official.

As part of a broader investigation into high levels of health-threatening nitric oxide diesel emissions, the German government ordered tests on a broad range of vehicles but found only Volkswagen had installed illegal manipulation software commonly referred to as a defeat device.

Volkswagen has already acknowledged using special software to cheat on U.S. diesel emissions tests and offered to pay substantial fines and compensation to American owners.

Big financial hit

The car company also said Friday it will take a 16.2 billion-euro ($23.3 billion Cdn) hit in its 2015 accounts related to the emissions scandal in the U.S. The writedown is more than double the 6.7 billion euros the company had previously estimated.

The company had delayed its earnings announcement until it could get a better estimate of the costs involved.

Analysts say the total costs in fines, legal judgments and lost sales will be significantly higher.

Analysts at Warburg Research think direct cost of fines, recalls and settlements worldwide will end up reaching 28.6 billion euros for fines — and that's excluding any impact on sales and market share.