Bloomberg reports the German manufacturer will be required to update the engine software in affected vehicles, despite having repeatedly denied any form of the emissions cheating conducted by fellow German automaker, Volkswagen.
In a statement posted on Twitter, the company said: "Daimler confirms the recall. Open legal questions will be clarified in the objection proceedings".
Speaking with the American publication, Arndt Ellinghorst, analyst with Evercore ISI in London, said: "We don’t see any evidence that Daimler was designing software to deliberately cheat on emission testing".
Evercore estimates the recall will cost Daimler less than €100 million ($155.33m), helped by the fact no fines are currently being imposed.
The KBA – Germany's automotive regulatory firm – says it found five illegal software functions in Daimler's Euro 6 turbo-diesel engines, according to German newspaper Bild am Sonntag.
A fortnight ago, reports out of Europe confirmed the German marque was under investigation for emissions-cheating software in its diesel engines, potentially affecting 120,000 vehicles across the C-Class and Vito ranges.