You’ll have done well to miss Volkswagen’s spate in the headlines this week.
The initial news that they had been caught cheating on a phenomenal scale was followed by a profit warning – shares have fallen by up to 40 percent – and the announcement of the resignation of VW CEO Martin Winterkorn.
At the launch of the new Passat sedan in New York, VW CEO Michael Horn openly admitted that the company had been ‘dishonest’ and had ‘totally screwed up’. VW has set aside £4.7 billion to cover the costs of the discovery, with the quoted number of cars affected standing at 482,000 in the US, 2.8 million in Germany and further disclosures expected to follow.
The scandal began with a particular engine, the 2.0 litre four-cylinder turbodiesel (official designation EA 189) fitted to millions of VWs, Audis Seats and Skodas worldwide. The engine was launched in 2009 to pass stricter emissions regulations introduced in 2008.
Many similar engines are obliged to make use of the injection of a urea-based solution, generally marketed as AdBlue, which reduces nitrogen oxide emissions (blamed for 30,000 deaths per year in the UK alone). VW always maintained that they could meet 2008 regulations without the need for AdBlue.
Last Friday the US Environmental Protection Agency announced that it had been discovered that the ECUs in 482,000 VW cars in the US contain a ‘sophisticated software algorithm’ or ‘defeat device’ that detects when the car is being emissions tested, and implements full emission control measures, resulting in a far lower reading of harmful emissions than the car could ever achieve under normal operation, a figure quoted by the EPA as between 10 and 40 times legal limits.
The software works by analysing readings from inputs such as the steering angle sensor, speed sensor, barometric pressure sensor and how long the engine has been running. These are compared to stored data for emissions test procedures and if they match, a ‘switch’ is activated and the ECU enables full emissions control.
Further to this discovery, it’s now becoming clear that cars fitted with VW’s 1.2 litre engine are affected along with a number of light trucks. There is speculation over whether VW’s 3.0 litre V6 engine is vulnerable but as yet no firm proof.
How will this affect you if you own a car running an affected engine? Currently the legal action is only in the US, but expect it to spread quickly to the rest of the world. Your car could then be recalled over the coming months and would most likely have the emissions system modified to match (or better) the quoted figures.
It’s entirely possible that a software-only modification could negatively affect performance and economy figures. A hardware solution such as fitting an AdBlue system would be preferable to customers but would cost VW dearly and could affect the load space of the cars.
This is an utter catastrophe for VW: it will almost certainly be obliged to recall every affected car to fix the software (or worse still fit new hardware) added to which the maximum possible fine imposed per car is £24,400.
Factor in possible criminal prosecutions, an immediate stop-sale order on new VWs in America, not to mention the disastrous effect this has had on VW group’s image, and the largest car manufacturer in the world is for the time being left in tatters. However Germany’s economy depends to such an extent on VW that it is unthinkable the company could actually go bust as a result of this debacle.
Whether similar techniques have been employed by other manufacturers, or indeed by VW on yet more engines, remains to be seen, but it’s extremely unlikely VW group is the only company employing such techniques, and this discovery may well unleash industry-wide havoc.
We’ll keep you updated on this story as it continues to develop.
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