VW launches investigation into ‘defeat device’ allegations

Volkswagen has ordered an external investigation after US regulators discovered software in certain diesel models that circumvents emissions standards.

Consequently, the US Environmental Protection Agency (EPA) said it is issuing a notice of violation (NOV) of the Clean Air Act (CAA) to Volkswagen, alleging that certain four-cylinder Volkswagen and Audi diesel cars from 2009-2015 contain the so-called defeat device, an algorithm in the ECU that identifies when a vehicle is on a rolling road for emissions testing and de-rates the engine accordingly.

In a separate action, California is issuing an In-Use Compliance letter to Volkswagen, and EPA and the California Air Resources Board (CARB) have both initiated investigations based on Volkswagen’s alleged actions.

Cynthia Giles, assistant administrator for the Office of Enforcement and Compliance Assurance said: “Using a defeat device in cars to evade clean air standards is illegal and a threat to public health.

“Working closely with the California Air Resources Board, EPA is committed to making sure that all automakers play by the same rules. EPA will continue to investigate these very serious matters.”

According to EPA, a sophisticated software algorithm on certain Volkswagen vehicles detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test.

The effectiveness of these vehicles’ pollution emissions control devices is greatly reduced during all normal driving situations, resulting in cars that meet emissions standards in the laboratory or testing station, but during normal operation, emit nitrogen oxides, or NOx, at up to 40 times the standard. The software produced by Volkswagen is a “defeat device,” as defined by the Clean Air Act, which requires vehicle manufacturers to certify to EPA that their products will meet applicable federal emission standards to control air pollution, and every vehicle sold in the US must be covered by an EPA-issued certificate of conformity.

EPA and CARB uncovered the defeat device software after independent analysis by researchers at West Virginia University. VW may be liable for civil penalties and injunctive relief for the violations alleged in the NOV.

“The Board of Management at Volkswagen AG takes these findings very seriously,” said Prof. Dr Martin Winterkorn, CEO OF Volkswagen. “I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible 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.” 

The allegations cover roughly 482,000-diesel passenger cars sold in the United States since 2008.

Affected diesel models include:

  • Jetta (Model Years 2009 – 2015)
  • Beetle (Model Years 2009 – 2015)
  • Audi A3 (Model Years 2009 – 2015)
  • Golf (Model Years 2009 – 2015)
  • Passat (Model Years 2014-2015)

Industry insight: Richard Gane, director and automotive sector specialist, Vendigital

This revelation comes at the worst possible moment for the diesel car market – a time of heightened concern about the health effects of NOx emissions and their overall levels in Europe and around the world. 

At the moment the investigation by the Environment Protection Agency (EPA) is focused on certain models of diesel-engine cars sold in the US, but there are already signs that regulators around the world are considering taking action.   

The disparity between the real world performance of diesel-engine cars and laboratory test results has long been viewed as a ticking time bomb and revelations surrounding VW’s emissions-rigging have pushed the issue into the spotlight. Environmentalists and manufacturers alike are now determined to know the cause of this disparity.

From a supply chain perspective, the revelations are likely to lead to a sharp fall in demand for diesel engine cars. In the US, the diesel car market currently represents around 1% of all new car sales and this is unlikely to increase in the short to medium term.

However, in Europe the impact could be much more significant, leading to a large tranche of the market switching to petrol engine cars virtually overnight.

UK-based component manufacturers of specialist transmission systems and emissions control equipment for diesel engine car models are likely to lose out and many suppliers will be forced to scramble to meet the shift in demand. Suppliers will be hoping that any uptick in demand for petrol engine cars will compensate for any dip in demand for diesel car components.

Henri Winand, CEO Intelligent Energy

The VW news highlights the increasing struggle that vehicle manufacturers face in order to meet stringent emissions targets. Vehicle emissions until now have been a somewhat diffused issue much like the pollution haze hanging above cities but this news highlights it is here and now and urgent action needs to be taken.

Therefore, the situation that OEMs find themselves in is twofold. Firstly, customers no longer want to be attached to brands that are bad for the environment. With widespread national coverage of this story, we can no longer assume that consumers don’t know the effect that the products they buy have on the environment.  Secondly, on a purely economic level, the status quo is not viable either.

The recent trend of fuel cell electric vehicle products from mass market OEMs hitting the consumer market shows that many in the industry are working to see the transition to true zero tailpipe emission mobility occur as quickly as possible.