Mercedes slightly overstated fuel economy in C300 compact sedans

DETROIT (Reuters) - Daimler AG's Mercedes-Benz will have to lower its labeling of fuel economy ratings on two all-wheel drive compact sedans, the U.S. Environmental Protection Agency said on Wednesday. The EPA tested the Mercedes-Benz C300 all-wheel drive FFV and PZEV models and found that the manufacturer had overstated by 1 mile per gallon the rating for city driving of each model. Mercedes-Benz stated a rating for each model of 20 mpg in city driving, and EPA testing showed 19 mpg, the agency said in a statement. For the PZEV model, the EPA found a highway driving rating of 28 mpg while Mercedes-Benz had labeled the model at 29 mpg. Mercedes-Benz is required to relabel its C300 all-wheel drive models for the 2013 and the 2014 model years, the EPA said. (Reporting by Bernie Woodall; Editing by Dan Grebler)