The drama surrounding Volkswagen’s diesel-related fiasco continues to escalate, and this one looks set to run and run. The fall-out from the screw-up is likely to be significant – news has just broken that CEO Martin Winterkorn has resigned, and the damage won’t be just limited to that or tumbling shares.
To recap, the German car manufacturer was caught out for having installed illegal “defeat devices” in its diesel-powered cars to help it comply with emissions tests in the US. Earlier in the week, it was reported that the United States Environmental Protection Agency (EPA) had begun lobbying for a recall of roughly 482,000 Volkswagen and Audi cars in the country over the issue, which involved the use of illegal code in software to help these cars pass emissions tests.
The software engaged full emissions control when the cars were put through emissions tests, but deactivated emission control systems in real-world operation away from testing facilities, the result being that cars were emitting “up to 40 times” the permitted levels of nitrogen oxides. The pollutants churned out are understood to be linked to illnesses such as asthma attacks and other respiratory diseases.
Affected vehicles include model year 2009-2015 Volkswagen Beetle, Golf, Jetta, Passat as well as Audi A3 units – all models were equipped with a turbocharged 2.0 litre four-cylinder diesel engine. Fines are expected to come about – initial reports said that automaker could be penalised by as much as US$37,500 per vehicle, and adding it all up would take the total to around US$18 billion.
So how did VW allegedly cover up things, and just how did it finally get caught out? According to a report by Wired, diesel vehicles in the US are equipped with a new tech called selective catalytic reduction, which scrubs pollutants before gases are emitted from the tailpipe.
The report explains that the scrubbing system works by spraying a liquid composed of 30% urea and 70% water into a honeycombed chamber within the exhaust path, and this composition chemically converts nitrogen oxides into nitrogen, oxygen, water and small amounts of carbon dioxide, effectively reducing diesel NOx emissions up to 90%.
It was this that gave away Volkswagen’s supposed masking exercise. In 2013, a small non-profit group decided to compare diesel emissions between European models and their respective US version. Together with West Virginia University, the International Council on Clean Transportation (ICCT) trialled three cars equipped with four-cylinder 2.0 litre diesels in the Los Angeles area.
The cars were a VW Jetta and Passat as well as a BMW – the latter was the only one who passed the test. The ICCT team noticed a discrepancy between the figures quoted by Volkswagen during emissions testing and recorded real-world numbers. Surprised by the results, the ICCT reported its findings to both the EPA and the California Air Resources Board (CARB).
Last year, the automaker agreed to address the issue with a voluntary recall after meeting with regulators. Then, in July, CARB performed follow up testing, and the cars failed again — Wired reports that the scrubbing system was present, but wasn’t running most of the time.
Further examination revealed that the emission control systems were inactive during regular use of a vehicle. When active, there’s a trade-off between performance and emissions, and so not running it aided performance but cranked out pollutants.
When it came to emissions testing, the car would behave as stated. The task was achieved by clever – and simple – manipulation of how the sensors responded in relation to input from the steering column, the report stated. During normal driving conditions, the fluctuation in the column as it moved to turning input kept the exhaust output unchecked.
Under emissions testing, however, the steering didn’t move despite the wheels doing so, which provided a trigger for the “defeat device” to turn the catalytic scrubber up to full power, allowing the car to pass the test. Clever, truly, but sometimes you can be too clever, and the price to be paid for being that is high indeed.
Looking to sell your car? Sell it with Carro.
Cukurrrr i drive bmw
VW and Audi try too hard to match BMW, but there are no way near.
I seriously don’t understand who convinces VW to take these risky path? Just like I don’t undertsand PM deposit gratification into his own account.
no worries…no diesel are sold here in Msia…all just petrol models….anyway, as if Msian regulation are soo stringent…..Petrol/diesel are still EURO2M …hahahahahahaha
Volkswagen can make stock clearance of all the stockyard petrol cars.
gain profit and cover all the penalties.
then, r.i.p Volkswagen.
You can sell all the company shares to China or India Company.
Like
Geely China bought bankrupting Volvo,
Tata India bought bankrupting Landrover and Jaguar.
let others revive VW, not Germans.
Muya, despite the shambolic VW scandal, nobody makes better cars than the Germans. Its a well known fact. Even Japanese and Korean car companies buy the latest German cars to take it apart to learn how to make their cars better. They also virtually own the Italian, British, Czech, Spanish and French (Bugatti) car industry. By the way, even if they lose US$50 billion, VW will not go bankrupt, as most of its assets are protected and backed by EU law and by the state of Lower Saxony in Germany, its major shareholder. Lower Saxony alone has a bigger economy than many Western European nations and has a very important voting position in the EU. Also, the EU needs VW to be strong as the company is one of the biggest private sector tax contributors to the EU.
The key issue here is how this serves as a lesson to VW not to rush to create records (penetrating the US market as quickly as possible) and also how they will come out of this crisis. A point to note is that their share prices recovered today after the initial bashing and CEO Martin Winterkorn resigned, which is the right thing to do. Do watch Bloomberg, CNN and other news channels to get the lowdown on the VW saga. Bet it will get interesting from now.
1. Volkswagen Revenue is 200 billion euro.
As per 2014, they earned 13billion euro operating income only.
1euro = 1.12 USD only.
2. anyway.. current $18bil fine = over 12 months operating income, and this only for not more than 500,000 units of VW diesel sold in US over 6 years.
3. Next, VW CEO claimed 11 millions ‘clean diesel’ car sold world wide. this is 22 times more than US market sold. Say 22 x $18 billions = $396billions
4. Revenue = 200billions euro vs up to $400billions of fine, globally?
5.Of course, this is over exaggerating in a way that not all country implement the EPA act. However, This shows that Volkswagen is Dying.
r.i.p Volkswagen.
Jennifer, you are basing on revenue only. Lets not forget that VW has huge cash reserves in the form of liquid assets and fixed assets worth more than £1.5 trillion. They own all their car companies and all their car plants around the world. They are not mere shareholders! I believe this crisis will dent VW in the next year, but after that it will be business as usual, if they get their marketing right.
nobody make better cars than Germans?
who make the best drift?
who makes the fastest car?
who was F1 champion?
who is Tesla?
who makes the most reliable car?
who sold the most hybrid car?
Needless to be so defensive for Cheater Volkswagen Audi.
We still have BMW and Benz, from Germany.
We love Lexus, BMW, Benz and Toyota.
Toyota salesman spotted
Lexus biscuit and Toyota are junk class cars. To list it with luxury cars is insult to its owners.
no such thing as nobody build better car than Germans.
BMW or Benz can take over Volkswagen Group.
or even Renault-Nissan Alliance.
Many better cars on earth other than Germany.
such as best EV cars from Tesla, US.
best handling drift cars from Japan.
best hybrid cars from Japan.
best hydrogen fuel cell cars from Japan.
bugatti from France.
best handling car from Lotus, UK.
Hello green, the problem is you dont buy cars to drift or go electric when there isnt even proper charging stations or quality batteries to make them run well, worldwide. Lotus might be the best handling (or so they say?) but does it sell in the real world? This is why the German cars are still the best, because they make cars that everyone around the world can use, without making them so complicated. For instance, people do not like cars from France, ie. Peugeot, Citreon and Renault because they are so eccentric. Eithere their tyres and wheels are so complicated or their batteries are so exotic, or their parts are expensive and hard to get. Thats why German cars are the preferred cars all over the world. Its simple yet technologically more advanced than the rest. Lets not forget, companies like Honda and Hyundai always try to replicate the design and tech of German cars like BMW and everyone has followed Audi with DRL lights that they started. ABS, BA and other technological advances in the motorvehicles industry were also started by German companies such as Mercedes, Porsche and VW.
Thank u sir for the good info.
Yes, in the last week alone with the scandal, VW lost US$20 billion in share value and yet the company is still the biggest in the world. This is a lot of money lost in just a week. As a comparison, Peugeot – the second biggest car company in Europe is worth just US$10 billion. So now you know how big the VW group is!
Volkswagen Car, Down.
Apple Car, Up.
I am thinking…should vw goes down the bankruptcy route perhaps its good time proton rescue it.
Then proton can become world’s top 3 car maker having owner not only lotus but also vw, audi, lamborghini, bugatti and ducati. Among others.
In my imagination.
Stop imagine.
this will be another 1MDB case.
We dont want Proton to waste Rakyats money further.
dream on…
Are you sure? you sound like a joke in the light that now BMw also seems to have lied in their emissions
US$37,500 per vehicle of fine.
this is equivalent to all 6 years of Gross revenue Lost for Diesel Car sold @ US. In other words, Can Close Shop, R.i.p Volkswagen.
Now: Volkswagen CEO Steps Down.
Next: New CEO, Restructure Volkswagen, Do Stock Clearance.
they shoudl see to their DSG lies in Malaysia first. Winterkorn resign no big deal. We Malaysians still suffer with our DSG
You are one of the vw owner or u just a walk pass vw haters?
VW cheated partly because the US EPA is too aggressive and sets unrealistic emissions standard. There’s only so much you can extract from fossil fuel. Less than 100g/km of CO2 for BMW X5? Get real.
Just heard that there is a possibiliy that all car companies will be investigated by the US authorities, as they mostly just need to meet the EPA requirements for sale in the US market only. It is a protectionist policy by the US authorities to limit the number of cars into the US. Very likely, BMW, Mercedes, Toyota, Nissan and Italian as well as French cars will undergo similar testing soon. Looks like its going to get really messy in the auto industry this year!
Looks like everybody is doing it
http://www.ft.com/cms/s/0/9e4a72a2-2f8c-11e5-91ac-a5e17d9b4cff.html
http://www.ft.com/intl/cms/s/0/9e4a72a2-2f8c-11e5-91ac-a5e17d9b4cff.html#axzz3md5hz54L
Luckily my BMW passed the test.
VW is a big liar.
Thing is, this is not where it ends. Questions as such remain:
1. VAG have not one TDI engine, but tons. Which other models are doing this?
2. As for other manufacturers, globally, not all have an AdBlue system. Case in point, the BMW X5 xDrive30d 3.0 diesel used in the test here with that Jetta was equipped with AdBlue but we know well and good our X5 xDrive30d that is using the same engine (IIRC) is without the AdBlue system.
So in other words, we really need an audit of emissions for all the diesels globally. And, yes, VW has had a really good clusterfu*k of the highest degree here. Tbh, I won’t be surprised if they go down now especially if their Euro models have the same issue too.
Though it would be sad, cause once you try out a TDi engine, trust me, you’d not even want to touch a TSi, their TDi engines are seriously one of the best in terms of power and refinement.
Leave the diesel engines for the those high riding vehicles – 4x4s, Pick-ups, SUVs & trucks , you name it. It’s either full petrol or petrol hybrid for proper cars..
NOx scrubber works at full-tilt when the steering wheel hardly moves while the wheels do.. What if VW brushes if off by saying that NOx emissions are usually high when vehicles are idling or moving at slow speed during a traffic jam, and their algorithms look for wheel movement with minimal steering column input because these are the conditions typically found in slow traffic or a traffic jam?
I don’t get it, why they just can’t get the catalytic scrubber running all the time?
“When active, there’s a trade-off between performance and emissions, and so not running it aided performance but cranked out pollutants.”
Keep calm and use petrol powered cars.
all this emission cowcrap & I’m still hooning my big-block muscle cars
Volkswagen diesel fiasco.
Volskagen die-(sel fiasco)-.
I doubt Malaysia has similar stringent emission standards given our Euro 2 diesel. VW can export all their cars to Malaysia and the sell them here; hopefully at a discount like the ongoing sales promotion?
heard the new ceo will be from internal …ie from porsche
there goes vw, audi, porsche, skoda, SEAT, MANS truck
lambo, ducati…lots of brand will be effected…another option, just use the other brand in the stable for future cars and relegate the vw’s brand to cold storage
Guess after this VW group will leave out its VW brand and use Audi, Porsche, SEAT, Skoda, Ducati…etc..etc..instead.
Ducati Golf? Porsche Passat anyone?…hehehehe
Tweak vw into a new brand, like accenture keh keh keh
Just sharing… that’s why you’ll really get outstanding real world FC driving BMW diesel. Other brands? most are on paper offerings.
Better be like Proton la. Slow, steady and safe. No need to investigate anything because there is no Proton in the US. Proton is designed for niche market, which is Malaysia market only. Hahaha..
There should a law that compensate or pay some damages to the vehicle owners for any defect that is due the manufacturers’ faults.
Paying the Law is one thing.
Compensating Customer is another thing.
If customers start to sue Volkswagen.
imagine that.
They cheat to score better in emission, so road users able to pay lower roadtax. Through this, proven they design the engine just to ‘pass everything’ in flying colours. How about the durability? Unbelievable news.
I was trying to figure out over the last couple of days; from an engineering perspective, how did VW program the car to detect when its cars were under test and turn on the program. Now I know the steering. Although the end result was unethical, but from the engineering perspective, think it was brilliant from VW. Who would have figure the steering variation would trigger the program to turn on…..
No need to resign. Just do 24 months of community service such as free dental for the poor….
those say cukur drive BMW, say BMW so godlike, nah in ur face :)
http://paultan.org/2015/09/25/bmw-x3-diesel-emitting-11-times-limit/
Like some of our education products; programmed to excel (and sometimes, cheat) at answering exams. On paper looks great, but really have poor real-life performance.
What big smoke screen about nothing. U.S. busses and big rigs and heavy equipment pollute far more than all the diesel cars combined. The cars, produced in this country, both diesel and gasoline could easily obtain twice ( even three times the fuel mileage ) they currently get ….. we have the technology to make this possible, BUT the manufacturers themselves and the oil industry and the Federal and State fuel taxing divisions don’t want this to happen because they would lose the tremendous and disgusting profits they are now making. Just stop and think, if cars got 60 + m.p.g. then these entities would only make 1/3rd of what they do now in profit and taxes.
Recently rented a turbo charged diesel VOLKSWAGEN Polo sedan in Croatia and after doing all the conversions ( gallons/liters and miles/kilometers. I got 81 MPG … you heard me right, EIGHTY ONE MPG and we noticed no abnormal emissions.
Now maybe the EPA standards are not as high in Europe as the U.S. but are you trying to convince me that there isn’t some acceptable figure between 25 and 82n.p.g. ? I say of course there is ….. it’s all about money and greed by big business and govt. in the U.S.
Until we see some changes in favor of the public here in the U.S., I will continue to drive and promote the use of Volkswagen diesels.
Bull …. the U.S. just doesn’t want good mileage cars to take away from the oil companies and the car manufacturers and the State and Federal govt.’s taxing base …. It’s all about greed, not concern for the environment.