Volkswagen pays the price

is to pay $1.1 million in fines to the US Government for failing to notify the

(EPA) of a defective oxygen sensor affecting at least 326,000 of its 1999, 2000 and 2001 Golfs, Jettas, and New Beetles.

As part of the settlement the company reached with the US Department of Justice and the EPA, Volkswagen completed a voluntary recall of the affected vehicles at a cost of over $26 million.

Vehicles with the defect may release thousands of tons of harmful pollutants including nonmethane hydrocarbons (NMHC) and carbon monoxide (CO). NMHC are key reactants in the production of ozone, a major contributor to cancer-causing smog. CO impairs breathing and is especially harmful to children, people with asthma, and the elderly.

“The penalty imposed in this case underscores auto manufacturers’ obligation to promptly alert the EPA of defects in emission control devices,” said Kelly A. Johnson, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.

The defect occurs gradually on engine start-up in cool and damp environments when the oxygen sensor (part of the emissions control system) cracks from “thermal shock.” The dashboard indicator light illuminates, telling the owner to “Check Engine.”

Volkswagen received numerous warranty claims associated with cracked oxygen sensors during the winter of 1999-2000, but did not report the defect to the EPA until June 2001. EPA had already discovered excess emissions from a randomly selected vehicle during a routine test.