Mercedes-Benz undecided if it will sell future U.S. diesels

By David Shepardson

NEW YORK (Reuters) - Daimler AG's Mercedes-Benz USA chief said the German automaker has not decided whether to resume selling diesel vehicles in the United States.

The German automaker has not received approval from the U.S. Environmental Protection Agency to sell 2017 model diesel vehicles.

The EPA said in September 2015 that it would review all U.S. diesel vehicles following an admission from Volkswagen AG that it had installed software in cars allowing them to emit up to 40 times legally permissible level of pollution.

In April 2016, the U.S. Department of Justice asked Daimler to investigate the emissions certification process for its Mercedes vehicles.

Dietmar Exler, president and CEO of Mercedes-Benz USA, told reporters at the New York auto show said the company's engineers are in talks with EPA over the diesel vehicles. He said he was not aware of the status of those talks.

Before the EPA declined to approve 2017 model diesel sales, Mercedes-Benz diesels accounted for just 2-3 percent of U.S. sales, Exler said. "No decision made one way or the other," on the future of diesel sales, he added.

Exler said the automaker plans a big boost in electric vehicles, adding 10 new EVs by 2025 worldwide, including 7 or 8 coming to the United States. "That's going to be the big focus going forward," he said.

He declined to comment on the status of the EPA review, saying if a "regulatory investigation is ongoing and you are not involved, it does not make sense to comment."

In March, German prosecutors said they had opened an investigation into whether Daimler employees may have committed fraud in a probe tied to diesel vehicle emissions.

Jaguar Land Rover, which is owned by Tata Motors , said on Wednesday it was adding a seventh diesel model for sale in the United States. The company estimates about 10-15 percent of its U.S. sales will be diesels this year.

Fiat Chrysler is also still trying to win U.S. approval to sell 2017 diesel models as the U.S. government decides whether to take legal action.

The EPA accused the Italian-American automaker of illegally using undeclared software to allow excess diesel emissions from 104,000 U.S. trucks and SUVs. The EPA has refused to grant Fiat Chrysler approval to sell 2017 diesel models.

VW Group of America chief Hinrich Woebcken reiterated on Wednesday the company has no plans to resume sales on new U.S. diesels.

In March, VW won approval from the EPA to sell up to 67,000 diesel vehicles from the 2015 model year, including about 12,000 in dealer inventory with approved emissions fixes. Woebcken said dealers have not yet resumed sales.

(Reporting by David Shepardson)