Volkswagen Accused Of Hacking 482,000 Diesels To Fake U.S. Emissions Tests - Mercedes Benz SLK Forum

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#1 Old 09-18-2015
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Volkswagen Accused Of Hacking 482,000 Diesels To Fake U.S. Emissions Tests

Justin Hyde
Managing Editor
September 18, 2015



The U.S. Environmental Protection Agency and California officials say some 482,000 Volkswagen and Audi diesels were engineered to falsify their emissions for federal tests—a violation that opens the German automaker to a theoretical fine totaling $18 billion.

The EPA and California Air Resources Board say the affected models had software in its computer engine controls that could sense exactly when it was being tested for emissions quality. At all other times, it would run the diesels in a different mode with illegal levels of pollution; for example, spewing up to 40 times more nitrogen oxide, a key component of smog, than allowed.

While other automakers have been accused of violating the Clean Air Act, this is the first time one has been found to have designed software specifically to circumvent the rules. The notice issued by the EPA and CARB today was the first step in a process that will likely lead to a recall of the affected models with 2-liter turbodiesel engines by VW; the agencies told owners that the vehicles are still safe to drive.

The affected cars include VW Jettas, Beetles, Golfs and Audi A3s with diesel engines from the 2009 to 2015 model years, along with diesel VW Passats from 2014-2015.

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

Volkswagen issued a statement saying it was cooperating with the agencies and would have no further comment today.

Under the Clean Air Act, each vehicle sold could be counted as a violation with a maximum fine of $37,500 apiece. Unlike with U.S. safety defect probes, there is no legal cap on the maximum fine a company can face for violating clean-air laws. Last year, Hyundai and Kia paid $100 million, and gave up clean-air credits valued at $200 million, for inflating fuel-economy numbers on more than 1 million vehicles.

As described by the EPA and CARB, the Volkswagen violation was no accident. In May 2014, researchers at a West Virginia University lab found higher-than-allowable levels of emissions during testing of a 2013 Passat and 2014 Jetta diesel. When asked by the agencies, VW said the differences were due to testing flaws and how the vehicles were being driven.

CARB ran its own follow-up tests, and continued to find irregularities. VW issued a preliminary recall in December 2014, but testing still found high pollutant levels. Only after the agencies threatened to withhold certification for VW’s 2016 model-year diesels—which would have kept them from going on sale—did the automaker reveal the presence of the software switch.

That switch had two modes, which VW calls “road calibration” and “dyno calibration.” Only in “dyno” mode, which monitored for the precise conditions EPA and other agencies would use to test emissions, do the engine’s full emission controls go into effect. At all other times, the diesels’ software uses the “road” mode.

VW has long touted its position as the biggest seller of diesel passenger cars and SUVs in the United States, collecting several awards for their ecological benefits, and promoting their “clean diesel” technology. So far this year, VW has sold about 49,000 diesel-powered vehicles, most with the 2-liter engine in question.


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Just like Uber, Volkswagen thought it could bypass local laws.
Unlike Uber VW will get a 18 billion dollars fine....
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VW faced ultimatum from EPA
Explain test discrepancy or stop selling diesels

Automotive News
September 20, 2015 - 12:01 am ET
WASHINGTON -- In the end, federal environmental regulators gave Volkswagen an ultimatum: Offer a convincing explanation for why many of its diesel vehicles were spewing more toxic emissions than they did in the test lab or face the loss of EPA certification for all its 2016 diesel models.

At that point, on Sept. 3, Volkswagen chose to explain.

And the explanation turned out to be a huge embarrassment for a company whose U.S. identity is closely tied to the promise of peppy "clean diesels": Volkswagen, the EPA said, used special software to manipulate its emissions controls during U.S. emissions tests, effectively doctoring its emissions results on seven model years' worth of diesel vehicles going back to 2009, in violation of the Clean Air Act.

Last week, the EPA announced that 482,000 Volkswagen and Audi diesel vehicles were fitted with what the agency called a "defeat device" -- software that would detect when a car is undergoing EPA emissions testing and turn on the vehicle's full emissions controls. The software then switched off the full emissions controls during real-world driving, the EPA said.

With the controls off, the cars emitted nitrous oxide at levels 10 to 40 times greater than what was permitted by law, according to the EPA.

Compared with other run-ins between the EPA and automakers, VW's alleged violation stands out in its brazenness. Ford and Hyundai-Kia both had to reduce the fuel economy ratings on several vehicles in recent years under EPA pressure, but those revisions were tied, in Hyundai-Kia's case, to errors in calibrating mpg tests, and in Ford's to exploiting loopholes in the law.

Volkswagen, on the other hand, admitted to installing software code designed to manipulate the results of EPA tests, regulators say.

"These violations are very serious, not only because illegal defeat devices result in excess emissions many times the allowable standard, but also because VW was concealing the facts from EPA, the State of California and consumers," Cynthia Giles, assistant administrator for the EPA's Office of Enforcement and Compliance Assurance, said in a conference call. "We expected better from VW."

"We expected better from VW."
Cynthia Giles
EPA

'VW on notice'

Janet McCabe, acting assistant administrator for the EPA's Office of Air and Radiation, said the office will "hold VW responsible" for recalling the affected vehicles to reduce the excess emissions but said no recall order was issued as part of the announcement Friday, Sept. 18. In a statement, VW said it would develop a remedy with the EPA and the California Air Resources Board.

For now, no fines have been ordered, as the investigation is continuing, but the EPA decided to announce the alleged violations to inform the public and "to put VW on notice of our continuing investigation," Giles said. The investigation is being conducted in cooperation with CARB.

Under federal law, the EPA can levy a maximum fine of $37,500 per vehicle, EPA officials said on the conference call Friday, meaning VW and Audi face potential fines that could top $18 billion.

Volkswagen said it's cooperating with the investigation.

"This is a notice of non-compliance that needs to be addressed," the statement said.

For more than a year, federal and California regulators had been investigating independent test results indicating older VW diesel vehicles were far dirtier in the real world than official emissions test results indicated. The independent analysis came from researchers at West Virginia University, working with the International Council on Clean Transportation, a nongovernmental organization.

VW initially responded that the disparities were caused by "various technical issues and unexpected in-use conditions," the EPA said.

But as the regulators pressed their inquiry, the EPA said, "none of the potential technical issues suggested by VW explained" the disparities.


Sales at stake

According to the EPA, the agency and CARB this month demanded an explanation from VW and were prepared to withhold certification that VW's 2016 diesel vehicles complied with U.S. emissions standards.

The EPA has since withheld those certifications, which effectively blocks their sale.

VW has now ordered U.S. dealers not to sell any remaining 2015 models with 2.0-liter diesel engines. And the automaker ordered an internal investigation. Also today, CEO Martin Winterkorn issued a statement apologizing for the violation.

"I personally am deeply sorry that we have broken the trust of our customers and the public," Winterkorn said in the statement. "Volkswagen has ordered an external investigation of this matter. We will do everything necessary in order to reverse the damage this has caused."

The withholding of the certification could be a devastating blow for VW, which relies on diesels for roughly a fifth of its U.S. sales and has made its clean diesel technology a cornerstone of its brand identity, setting it apart from mainstream competitors.

"Only then (when confronted by regulators) did VW admit it had designed and installed a defeat device in these vehicles in the form of a sophisticated software algorithm that detected when a vehicle was undergoing emissions testing," the EPA said in its notice on Friday.

"The dogged detective work in the lab provided the data and resulted in an admission that VW did indeed have a defeat device in its software for diesel cars," Richard Corey, executive officer of CARB, said on the conference call.

You can reach Ryan Beene at [email protected]. --
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VW shares losing 20% this morning in Frankfurt.
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Wow. The CEO is toast. Them shareholders will run him out of Wolfsburg with a Pitch Fork.
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The CEO spoke at the news conference



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VW diesel 'defeat device' scandal will test CEO

Automotive News
September 21, 2015 - 6:00 am ET -- UPDATED: 9/21/15 10:55 am ET -- Stock activity added
MUNICH -- Volkswagen CEO Martin Winterkorn may face a leadership challenge after it was disclosed that the automaker cheated on U.S. air pollution tests for diesel cars, analysts said.

VW faces fines of up to $18 billion and a backlash from consumers in the U.S. after the company admitted that software that it designed for VW brand and Audi diesel cars gave false emissions data.

Today, Volkswagen shares plunged as much as 23 percent to 125.40 euros in Frankfurt, extending the stock’s slump for the year to 31 percent. The drop wiped out about 15.4 billion euros ($17.4 billion) in value at the time. The shares closed the day in Germany down 17 percent to 133.55 euros.

Arndt Ellinghorst, a London-based analyst for Evercore ISI, called the move "worthy of a back-street garage looking to get a used car through a mandated vehicle inspection." The issue may help to catalyze further management changes at VW, he said.

Winterkorn, whose contract renewal is scheduled for a supervisory board vote on Friday, now faces a serious challenge to his leadership, Ellinghorst said in an investors note today.

Analysts at Bernstein said the issue is a serious setback for VW. "This is not your usual recall issue, an error in calibration or even a serious safety flaw. There is no way to put an optimistic spin on this -- this is really serious."

Trying to pin the blame on rogue engineers probably will not appease U.S. regulators, said Bernstein analyst Max Warburton. The best-case scenario is a multibillion-dollar fine, damage to its diesel market share and "pariah status in the U.S. with government, and possibly consumers," he said.

Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisburg-Essen, said Winterkorn should resign. Winterkorn should have known about the manipulation in his role of head of VW's r&d or, if he didn't, it shows that he does not have the automaker under control, Dudenhoeffer told a German newspaper. Either way, Winterkorn's role as CEO is no longer tenable, the academic said.

VW said on Sunday that the company is cooperating with an investigation by the EPA and has ordered its own external investigation. In a statement Winterkorn said: "I personally am deeply sorry that we have broken the trust of our customers. He said VW would do “everything necessary in order to reverse the damage this has caused.”

U.S. backlash

Earlier this year, Winterkorn won a power struggle with his former mentor and chairman, Ferdinand Piech, forcing Piech's ouster from the automaker. As investigators seek to establish complicity within the company, Winterkorn will need to walk a fine line to shield himself and VW from a backlash in the U.S., a market where VW, despite being the world's biggest carmaker, has struggled for decades.

The VW brand's struggle to compete in the U.S. was one issue Piech cited in his failed attempt to oust Winterkorn earlier this year. Clean, powerful diesel vehicles were supposed to be VW's ticket to growth, and the company has big plans for the U.S. It spent $1 billion on a factory in Tennessee in 2011, then said it would invest an additional $7 billion in North America by 2018.

VW brand and Audi sold about 482,000 diesel vehicles in the U.S. with illegal emissions control software designed to make their cars appear cleaner in testing than they are in the real world, according to the the EPA.

The software, included on VW and Audi vehicles from the 2009-15 model years with 2.0-liter turbodiesel engines, detects when a car is undergoing EPA emissions testing and turns on the vehicle’s full emissions controls.

The software then switched off the full emissions controls during real-world driving, the EPA said. Officials called the software a “defeat device” that allowed VW and Audi vehicles to fulfill emissions standards in lab testing, but emit nitrogen oxides at up to 40 times allowable levels in real-world driving.

VW said it has told U.S. dealers to halt sales of some of its diesel cars. Diesel models can account for 20 to 25 percent of the VW brand's U.S. sales each month. The ban is expected to put a major dent in the company's volume and slow its turnaround efforts in coming months.

The vehicles affected include the VW Passat, Jetta, Beetle and Golf, and Audi A3.

Bloomberg and Reuters contributed to this report.

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Originally Posted by BCoolidge View Post
Just like Uber, Volkswagen thought it could bypass local laws.
Unlike Uber VW will get a 18 billion dollars fine....
VW could get that back and more if they marketed the software on the black market for us to use just before MOT time...
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Quote:
Originally Posted by Hal Adams View Post
VW could get that back and more if they marketed the software on the black market for us to use just before MOT time...
Drive the car 20 minutes at high rev, then remove air filter. Should do the trick to pass emission control. Don't need to be a computer geek...

So VW is screwed at least in the US according to Jalopnik

Volkswagen Is Screwed

That said VW can hire Justlin Gatlin as their new company representative.. Cheated twice, still running
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Just been on 9pm news over here in the UK, **** is hitting the fan.
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This is the latest.

This VW Diesel Scandal Is Much Worse Than a Recall
This isn't cost-cutting. This is outright cynical deceit.


VW can't bail on US market - Business Insider
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VW's diesel sales frozen until compliance is proven,


EPA official saysAutomotive News
September 21, 2015 - 3:27 pm ET -- UPDATED: 9/21/15 4:58 pm ET - adds House hearing
WASHINGTON -- With its diesel car lineup grounded by an emissions-test cheating scandal, Volkswagen now bears the burden of proving that these vehicles comply with federal emissions standards, the EPA’s top auto regulator said.

Until then, said Chris Grundler, director of the EPA’s Office of Transportation Air Quality, no sales.

Meanwhile, Grundler said, the EPA and California regulators are now probing all light-duty diesel vehicles in the U.S. market from all manufacturers to check for illegal software designed to fool U.S. emissions tests.

U.S. regulators accused VW on Friday of violating the Clean Air Act by selling 482,000 diesel-powered vehicles with such illegal software. The agency said the company admitted to fitting seven model years’ worth of diesel cars with a “defeat device” that would activate the cars’ emission controls during testing, but deactivate them in real-world driving.

In order to be able to resume sales of diesels, Grundler said, VW has to engineer a fix to bring those vehicles into compliance, and receive EPA approval before a recall can commence. It’s not clear yet whether that fix will consist of a change to the engine’s emission control software or more substantial engineering changes to vehicle hardware, Grundler said.

According to the EPA’s website, it could take up to one year to identify “corrective actions,” develop a recall plan and issue recall notices. But Grundler declined to discuss a specific timetable.

“Until we gather that information and are convinced ... we’re not going to go forward with the recall,” Grundler said. “It will take more work to determine what the appropriate remedy for these vehicles is.”

Capitol Hill

U.S. lawmakers want more answers, too.

Republican leaders of the House Energy and Commerce Committee today announced plans to hold a hearing on the VW emissions scandal in the near future. The hearing will be held before the panel’s Oversight and Investigations Subcommittee, though no date has been set.

“We will follow the facts. We are also concerned that auto consumers may have been deceived – that what they were purchasing did not come as advertised,” U.S. Reps. Fred Upton, R-Mich., and chairman of the Energy and Commerce Committee and Tim Murphy, R-Pa., chairman of the investigations subcommittee, said in a joint statement.

"The American people deserve answers and assurances that this will not happen again. We intend to get those answers.”

Also in Washington, the White House said today it was "quite concerned" about reports it was seeing concerning VW's conduct in complying with U.S. Clean Air Act requirements.

"It's fair to say that we're quite concerned by some of the reports that we've seen about the conduct of this particular company, but ultimately this is the responsibility of the EPA to take a look at it and that's exactly what they're doing," said White House spokesman Josh Earnest.

California questions

VW will also have to convince the EPA and California’s Air Resources Board that its 2016 model year diesel vehicles will comply with emissions standards and are free of any illegal software, Grundler said. Until then, the agency will continue to withhold the emission certifications needed to begin sales of those models, which are currently being withheld from dealers.

The sales suspensions are a blow to Volkswagen, which counts on diesels for more than one-fifth of the VW brand’s sales volume, and has touted its “clean diesel” technology as a key differentiator in the marketplace.

“We’ve been working with the company for a long time trying to get answers and it wasn’t until very recently that VW admitted that these vehicles contained software designed to defeat the emissions standards,” Grundler said. “We want to make sure that 2016 model vehicles don’t operate the same way.”

Reuters contributed to this report.
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This VW cheating starts to read like a crime novel.


VW faces legal fallout from cheating -- this time in Germany


September 21, 2015 19:11 CET
BERLIN (Bloomberg) -- Volkswagen's legal problems started in the U.S., but the carmaker is finding the fallout over its cheating on U.S. environmental tests is extending to its home market of Germany.

VW's shares lost nearly a quarter of their value on Monday in Frankfurt, and financial regulator Bafin is looking at possible violations of German rules. VW also faces legal threats from investors and environmental groups.

"Like in comparable cases, with strong share movements we look at the VW stock as to insider trading, market manipulation, and ad-hoc disclosure rules," Bafin spokeswoman Anja Schuchhardt said in an e-mail. "But this is a matter of routine."

VW admitted to fitting its U.S. diesel vehicles with software that turns on full pollution controls only when the car is undergoing official emissions testing, the Environmental Protection Agency said Friday. With 482,000 autos part of the case, the U.S. fine could theoretically total more than $18 billion. The final fine will likely be far less.

During normal driving, the cars with the software -- known as a “defeat device” -- would pollute 10 times to 40 times the legal limits, the EPA estimated. The discrepancy emerged after the International Council on Clean Transportation commissioned real-world emissions tests of diesel vehicles including a Jetta and Passat, then compared them to lab results.

VW halted sales of the models involved on Sunday and said it is cooperating with the probe and ordered its own external investigation. CEO Martin Winterkorn, who has led the company since 2007, said he was “deeply sorry” for breaking the public’s trust and that VW would do “everything necessary in order to reverse the damage this has caused.”

Andreas Tilp, a lawyer representing investors in German court, says VW may have to pay damages to stockholders in Germany if the allegations of U.S. authorities are upheld. Investors may seek to recover losses incurred because of the stock’s decline.

"We’re convinced that VW failed to properly inform the markets and is liable to investors who can seek billions," Tilp said. "Concealing for years the immense risks of the pollution manipulation and the U.S. probes is a violation of capital market rules.”

Volkswagen spokesman Claus-Peter Tiemann said he can’t comment on the German legal developments and referred to Winterkorn’s earlier comments.

Environmental group Deutsche Umwelthilfe said it will sue carmakers to have diesel vehicles removed from the streets starting 2016. It will also take legal action to have Germany’s Federal Motor Transport Authority revoke licenses for the vehicles.

While rules on emissions are similar in the U.S. and Germany, the Federal Motor Transport Authority isn’t properly controlling its implementation, Juergen Resch, DUH’s director, said in an e-mailed statement.

The German agency isn’t controlling pollution, and should use recalls in case of violations of environmental rules, Resch said. The Federal Motor Transport Authority’s press office didn’t reply to an e-mail seeking comment.

VW has promised to support testing by German authorities of the company's diesel cars, the transport ministry said on Monday. In a statement, it said that Alexander Dobrindt, the transport minister, had talked to Winterkorn and that Winterkorn had expressed his "absolute support" for the independent testing of diesel car models that the minister had ordered.

Earlier the Bild newspaper had said Dobrindt has ordered an examination of Volkswagen diesel cars.

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As I understand this, it relates to injecting an aqueous urea solution into the exhaust system to completely oxidise the nitric oxide pollutants? Does this mean that Mercedes deisel engines, without the above, are ok?
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VW shares currently losing another 20% from yesterday where it lost 17%

Friday 162 EUR
Monday 132 EUR
Today 103EUR

VW is in fact impacting all European stock markets...
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I have a Q7 and so far that seems OK….this is a shocking betrayal of trust though…have to rethink any future purchases from this auto-group…..


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Originally Posted by Berliner Heckflosse View Post
This VW cheating starts to read like a crime novel.
There was a great report on Arte back in 2009. This was when Porsche tried a hostile takeover on VW.
This documentary watches like a thriller....

Sorry video is in German

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#19 Old 09-22-2015
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Give it time this will all blow over and forgotton and people will still buy vw / audi by the masses etc

Any one wanted to buy peoples vw now is a good time to buy

Will there be any compensation to the public who own one that has been affected ?
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#20 Old 09-22-2015
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VW CHEATED — 11 MILLION TIMES

VOLKSWAGEN ADMITS 11 million of its vehicles sold worldwide are fitted with the same software designed to trick emissions testing equipment as the 500,000 vehicles involved in an emerging scandal in the United States.

Volkswagen says that an internal investigation has revealed that 11 million of its vehicles sold worldwide are fitted with the same software designed to trick emissions testing equipment as the 500,000 vehicles involved in an emerging scandal in the United States.

In a statement, Volkswagen said it “does not tolerate any kind of violation of laws whatsoever. It is and remains the top priority of the Board of Management to win back lost trust and to avert damage to our customers. The Group will inform the public on the further progress of the investigations constantly and transparently.”

On Monday night at an event in New York to unveil the updated 2016 Passat sedan, Volkswagen’s US President and CEO, Michael Horn, told the audience that "we have totally screwed up."

In the wake of its statement, VW's share price was down another 17.6 percent at 110.20 euros and near a four-year low. The fall comes on top of Monday's hefty 17 percent decline and means the company has lost an eye-watering 25 billion euros or so in just two days of frenzied trading.

The trigger to the company's market woes was last Friday's revelation from the U.S.'s Environmental Protection Agency that VW rigged nearly half a million cars to defeat U.S. smog tests.

The company then admitted that it intentionally installed software programmed to switch engines to a cleaner mode during official emissions testing. The software then switches off again, enabling cars to drive more powerfully on the road while emitting as much as 40 times the legal pollution limit.

In its statement Tuesday, Volkswagen gave more details, admitting that "discrepancies" related to vehicles with Type EA 189 engines and involved some 11 million vehicles worldwide.

"A noticeable deviation between bench test results and actual road use was established solely for this type of engine," it said. "Volkswagen is working intensely to eliminate these deviations through technical measures."

To cover the necessary service measures and what it says are "other efforts to win back the trust of our customers," VW said is setting aside some 6.5 billion euros in the current quarter.

That figure, it conceded, may be subject to revaluation in the light of ongoing investigations. As a result, it said 2015 earnings targets will be adjusted but it didn't specify by how much.

It added that the software is also installed in other vehicles with diesel engines but that that for the "majority of these engines the software does not have any effect."

Volkswagen said that new vehicles with EU 6 diesel engines currently on sale in the European Union comply with legal requirements and environmental standards.

CEO Martin Winterkorn issued an apology on Sunday for the U.S. scandal, promised an internal investigation and acknowledged that his company had "broken the trust of our customers and the public."

VW's troubles already are not confined to the U.S., though.

South Korea said Tuesday it would investigate emission levels of Volkswagen diesel vehicles in the wake of the rigging scandal in the U.S. that has heaped pressure on Winterkorn. The German government is to also conduct new emissions tests in VW's diesel cars, while France called for a wider Europe-wide investigation into Volkswagen's practices — and into those of French carmakers.

Even before Tuesday's statement, a member of Volkswagen's supervisory board suggested that heads will roll in the wake of the scandal, though he said it was too soon to start assigning blame.

Speaking on Germany's Deutschlandfunk radio, Olaf Lies cautioned against "over-hasty calls for resignations."

Lies, who is also the economy minister of the German state of Lower Saxony, which holds a 20 percent stake in Volkswagen, said he was sure there would be "personal consequences" once the investigation is complete.

The shockwaves from the scandal enveloping Volkswagen were being felt far and wide across the sector as traders wondered who else may get embroiled. Germany's Daimler AG, the maker of Mercedes-Benz cars, was down 6 percent, while BMW AG fell 5.3 percent. France's Renault SA was 5.5 percent lower.

"It's an auto sector shaking incident," said Connor Campbell, a financial analyst at Spreadex.


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