Volkswagen was warned years ago about emissions tricks: report

27 Sep 2015 | Author: | No comments yet »

Germany gives deadline to Volkswagen on meeting pollution standards.

BERLIN: Volkswagen ignored warnings from staff and a supplier years ago that the emission test rigging software that sparked the company’s worst ever corporate scandal was illegal, news reports said on Sunday (Sep 28). German authorities meanwhile heaped pressure on the embattled corporate titan, demanding it set out a timeline by Oct 7 on how it will ensure its diesel cars meet national emission standards without using the cheat technology. If Volkswagen fails to meet the deadline, the KBA warned in a two-page letter, the authority could withdraw approval for the affected models, meaning they could no longer be sold or even moved on German roads. The spiralling scandal has badly tarnished VW’s name, left it exposed to billions of dollars in fines in the United States and to investigations from Norway to India, while wiping about a third off its stock market value in a week.

Last Friday, after a marathon crisis session, the carmaker’s board tapped company insider Matthias Mueller – chief of its luxury sports car brand Porsche – to steer the world’s largest automaker out of the wreckage. Bild am Sonntag also reported that German auto parts supplier Bosch had produced the controversial software but had warned the VW Group as early as 2007 that it was meant for test use only and that using it on the road would be illegal. Mueller, 62, who replaces Martin Winterkorn as CEO, pledged that “we will overcome this crisis” and vowed to restore confidence through “an unsparing investigation and maximum transparency”. But an internal probe has already unearthed more troubling news for VW, as it faces judicial penalties and class action lawsuits, according to German newspaper reports Sunday. A Volkswagen spokesman told AFP the company would soon present an action plan in Germany and “announce when we expect to launch a recall” that would include a software update. “We are working at full throttle” on the plan, the spokesman said.

And according to the Frankfurter Allgemeine Sonntagszeitung (FAS), a VW employee had also sounded the alarm in 2011, warning that the software may spell an “infringement” of the law. The European Commission said Friday that a new testing procedure will come into force in January, because the current laboratory tests do “not reflect the emissions of vehicles in normal driving conditions”. EU sources said the change aims to prevent the sort of rigging used by VW after research over several years had shown a difference between lab results and those found in real driving conditions.

The German group has suffered its biggest crisis in the same year it had reached its long-time goal – overtaking the Japan’s Toyota as the world’s top car maker by sales. Since the revelation, it has been hit by a cascade of bad news, including the threat of massive fines for which VW has set aside €6.5 billion in provisions for the third quarter.

Volkswagen’s shareholders – dominated by the Porsche SE holding company, a separate entity to the luxury brand – are expected to hold emergency talks in Berlin on November 9. German Environment Minister Barbara Hendricks, speaking to the Handelsblatt daily, said the scandal “casts a pall on the environmental promises of German companies”. The chief of German luxury auto giant Daimler, Dieter Zetsche, told the FAS it was too early to assess the negative impact on Germany’s crucial car sector, adding: “I hope the damage isn’t permanent.”

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