In small, Volkswagen AG was roundly accused by regulators with evidence in hand, and admission by the accused, it deliberately devised a way to cheat its way through diesel emissions certification testing.
In this area 482,000 TDI diesel cars are in inquiry, including several VW brand models, and the Audi A3, and patrons, dealers, and others are feeling the effects now playing out.
SEE ALSO: EPA and California Allege Volkswagen Diesels Willfully Circumvented Clean Air Act
It’s hitting the
Some have now called it “Dieselgate” reminiscent of former president Nixon’s “Watergate” scandal over insincere to the public, and at least clear is the
German automaker faces charges of deliberate diesel emissions rules evasion.
To summarize what is experience, we’ll around up key facts and ramifications of the scandal that has rocked Volkswagen’s “clean diesel” legacy.
Just the facts
On Friday Sept. 18 the U.S. EPA issued an unequivocal statement laying out a case for a “notice of violation” (NOV) against Volkswagen AG.
Separately, California was in process of issuing Volkswagen as In-Use Compliance letter. This was the
At issue was a “defeat device” relying on computer software Volkswagen allegedly hoped would by no means be detected was letting cars sail past stringent U.S. Tier 2, Bin 5 emissions rules, but once on the road, they emitted 10-40 times the NOx.
Volkswagen plant, Chattanooga, Tenn.
Volkswagen for years has toured its “Clean Diesel” reputation. The engine in inquiry was used for four-cylinder Jetta, Insect, Golf, and Audi A3s, the EPA said, casing 2009-2015. Passats model year 2014 and 20i5 were also included.
Other VW/Audi diesels have not been implicated in using software that let the cars detect when they were being tested so as
Initially honest-minded observers said it smacked of a witch hunt by heavy handed authorities making VW grow guilty until proven innocent but the strong accusation came after VW had already admitted to regulators its wrongdoing.
“Our goal now is to ensure that the affected cars are brought into compliance, to dig more deeply into the extent and implications of Volkswagen’s efforts to cheat on clean air rules, and to take appropriate additional action,” said Cynthia Giles, Supporter Administrator for the Office of Enforcement and Compliance Pledge.
If the book is thrown at them, said the EPA, up to $18 billion in fines could be levied against VW at $37,500 per car for 482,000 model year
Not said in Friday’s press release was the EPA and California Air Resources Board had let VW quietly save face. The automaker last December did recall the close-to half-million affected cars but software updates could not remedy the out-of-compliance emissions.
In July regulators had confronted VW, the controversy has been a back-and-forth dialogue behind the scenes all summer, but it was not really the U.S> Government of California which originally learned the defeat device.
The evidence had been uncovered in the course of normal research by the International Council on Clean Transportation (ICCT) in Europe, according to Bloomberg.
SEE ALSO: How Volkswagen Tricked the EPA’s Emissions Test
They found VW diesels with the EA188
Tests were then conducted at West Virginia University, and its Center for Alternative Fuels, Engines and Emissions confirmed the discrepancy.
“In September, after EPA and CARB demanded an explanation for the identified emission problems, Volkswagen admitted that the cars contained defeat devices,” said the EPA.
Over the weekend the company’s CEO Dr. Martin Winterkorn apologized matching a humble tone set by the U.S. arm of the German Automaker which has otherwise not existing additional comment saying only it is cooperating with investigators.
Volkswagen Assemble of America, Inc.:
Volkswagen is committed to fixing this issue as soon as possible. We want to assure customers and
The Board of Management at Volkswagen AG takes these findings very seriously. I in person am deeply wretched that we have broken the trust of our customers and the public. We will cooperate fully with the reliable agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case. Volkswagen has ordered an external investigation of this matter.
We do not and will not tolerate violations of
The trust of our customers and the public is and continues to be our most vital asset. We at Volkswagen will do all that must be done in peacefulness to re-establish the trust that so many public have placed in us, and we will do all de rigueur in peacefulness to reverse the hurt this has caused. This matter has first priority for me, in person, and for our entire Board of Management.
Among those who are following the news, the court of public attitude has not taken too kindly to it, but while opinions range widely, consequences are just now unfolding.
Immediately Volkswagen stopped sales of affected
Consumer Reports reported that CARB could make VW re-register its cars before they could again be sold.
SEE ALSO: Will America Avoid Europe’s ‘Clean’ Diesel Problems?
Volkswagen is unique in that its TDIs, while commanding a price premium above gas models, are the leaders in the small diesel market in the U.S. It was a claim to fame, and TDIs comprised 22 percent of sales.
Audi has gone so far as to lobby Washington and take conspicuous photos of its symbolically white diesels parked in adjoin of the well-known landmarks in the
On Monday but, Volkswagen’s stock tumbled more than 20 percent. Today, Tuesday, the stock is still in free fall, and down over 19 percent at mid-day. It has dropped from the 160s to around 107 in a couple days, importance many more billions in lost market capitalization value than the potential $18 billion fines.
Yesterday also, the U.S. Justice Department said it is opening a criminal investigation, and the U.S. Congress has opened a formal inquiry as well.
No criminal charges by the Justice Department have been pressed at this point, but House Energy and Commerce Committee chairman Fred Upton and Administration and Investigations Subcommittee chairman Tim Murphy will hold a hearing in coming weeks.
That timing of the allegations additional, has not been excellent.
They came in the wake of a $900 million GM ignition switch recall settlement, and still in the public reminiscence is Toyota’s unintended acceleration controversy and settlement.
EPA testing itself is done on a bit of an honor system, and automakers are trusted to follow EPA protocols and certify they met the grade. The EPA tests 10-15 percent
In the past couple years Ford downgraded certain hybrids and internal combustion vehicles when it was found to have used a loophole and due to other issues, and Kia and Hyundai also were found overstating results.
In cases where automakers are found out, everyone apologizes, and seeks forgiveness, but how the public responds to instances of lost public trust caries.
Disparate the GM crisis, no one has died by VW’s alleged misdeeds, and the vehicles are not a direct safety risk authorities say. They really perform better with excellent horsepower and torque, and can beat their mpg ratings, but they are not emissions complaint and by law by
They are to be recalled, but whether it will be an simple fix, or cost thousands per car has yet to be stated.
What this could do to 2009-2015 four-cylinder TDI resale values is still playing out for cars public paid a premium for in excellent faith thought they were buying clean diesels.
The 2015 models with EA288 diesel, such as this Golf Sportwagen, use urea injection to combat NOx.
Ironically, VW apparently left the “defeat device” in place into its new EA288 2.0-liter four replacing the EA188 in inquiry. This engine might have been emission compliant without cheating as it utilizes urea injection to tackle the NOx problem. Formerly urea injection was not
How the discovery of a carefully planted defeat device will affect VW’s reputation in the long term remains to be seen. The company has studied American market and “Americanized” its cars in an attempt to gain inroads. It has aspirations to be number one by 2018, it has said.
Its VW brand but has had profitability challenges, and as a whole it ranks 15th on Consumer Reports list of automakers out of nearly 30. Anecdotes are surfacing of VW vehicles having other quality control issues, though there are many others who like their VWs.
In the immediate aftermath of shocking
It should be noted no other automaker has yet been accused of such misdeeds with its diesels, but Allen Schaeffer, executive director of the Diesel
Technology Forum, otherwise is taking a wait and see approach with no comment on VW.
“[W]e are in no doubt that clean diesel cars will be an vital technology for meeting current and future clean air, fuel efficiency and environmental standards,” said Schaeffer. “Also we won’t speculate in this area impacts on the diesel market in general. There are a number of manufacturers selling diesel cars, light trucks and SUVs, and based on public announcements, we are expecting that there will be 54 choices of
How Could this Affect Electrification?
As the dust settles, opinions are being formed. We’ve seen the most candid say they will impose sanctions VW for life, and others admit they hope this will drive a coffin nail into diesel, and turn positive attention to hybrids and EVs.
But while some in the public are paying attention, some have not even seen the news, and some have said they’re unfazed.
Among alternative energy proponents, diesel is a key, and VW had been most candid in advocating it as a green alternative.
A car driven on battery power is also a key, and batteries and electric
The plug-in electrified market is really less vital in the U.S. than diesels, and in Europe and other markets, diesels delight in a huge edge.
Last year diesels accounted for 0.84 percent of a 16.5 million U.S. vehicle market, whereas EVs took 0.39 percent, PHEVs took .34 percent, and hybrids accounted for 2.75 percent.
The Obama administration and the EPA and CARB have been more in favor of electrification, offering subsidies where diesels get none.
Now as though to validate what VW once decried as an un-level playing field, the country’s most well loved diesels have beed
How this and other nuances play out also can only be answered with time will tell.
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