Volkswagen emissions scandal woes grow as company faces global scrutiny
-
Molly Jackson Staff
After Volkswagen apologized on Sunday for fitting 11 million vehicles with software meant to fool emissions testers, generating a race to sell shares that lost the company 25 billion euros (almost $28 billion US), governments around the world resolved to launch their own investigations.
The company scrambled to recover from international fallout that began last Friday when the US Environmental Protection Agency announced that Volkswagen had installed so-called 鈥淒efeat Devices鈥� on several diesel engine models between 2009 and 2015. The devices keep cars in a 鈥榞reener鈥� emissions mode while undergoing emissions tests, then automatically switch into much more polluting mode once cars are actually on the road: up to 40 times the US legal limit. Some 500,000 vehicles had the software installed for the US market, but up to 11 million may be affected worldwide.
As the company鈥檚 stock prices fell to a four-year low, it said Tuesday that it would dedicate 6.5 billion euros (over $7 billion US) to remedy the problem and 鈥渢o win back the trust of our customers.鈥�
So far, the EPA has not levied a fine on the company, although it has said it has the right to charge them $18 billion. But other countries may not be so forgiving.
In Volkswagen鈥檚 native Germany, where its diesel cars will be subject to new tests, Chancellor Angela Merkel called for 鈥渇ull transparency,鈥� demanding that 鈥渢he facts ... be put on the table as quickly as possible.鈥� Elsewhere in Europe, France called for European nations to cooperate on an investigation, saying that French carmakers would also be held up to scrutiny. Britain's Transport Secretary Patrick McLoughlin seconded the call for a . South Korea also promised to investigate.
The EPA鈥檚 study focused on Type EA 189 engines, and Volkswagen has admitted that the same deceptive software is programmed in other diesel vehicles, as well. However, they claim that the 鈥渄efeat device鈥� 鈥渄oes not have any effect鈥� on other engines.
The scandal comes at a particularly bad time for Volkswagen鈥檚 European markets: the European Parliament will vote in October on before 2030.
鈥淚 personally am deeply sorry that we have broken the trust of our customers and the public,鈥� Martin Winterkorn, Volkswagon's chief executive,聽said in a statement on Sunday.
Mr. Winterkorn took the helm in 2007, and was scheduled to hold his post until 2018. It remains unclear if that plan will proceed.
This report includes material from the Associated Press and Reuters.
