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German Exporters: Keep the Euro

SS Protege Ludwig Ehrhard: Father of "German Economic Miracle"

COMMENT: Much consternation has been expressed by Germans frustrated with having to bail out weaker EMU economies. What has received less attention is the fact that Euro was predictably weak. That weakness has kept the price of   German exports low, boosting their economy to a level unmatched since the early 1990’s.

This fact alone, makes it unlikely that Germany will be leaving the currency union anytime soon.

“Why Germany and its Automakers Won’t Let the Euro Collapse” by Neil Winton; Detroit News; 11/27/2010.

EXCERPT: . . . . The reason: German industry in general and its automotive business in particular benefits massively from being a member of the E.U. and using the euro to price its exports. If the euro collapsed and Germany had to revert to its old currency, the mark, its auto industry would take a price hit of perhaps 25 percent. If Germany was forced to revert to the mark, car manufacturers would quickly move production out of high-wage Germany, causing huge unemployment. To a degree this is happening already, but it would become a disruptive and politically unacceptable stampede if the mark was called off the bench and the euro dumped.

“Whether Germany is willing to pay more for more bailouts ultimately depends on whether German politicians can sell this to the German people,” said professor David Bailey of the Coventry University Business School.

“There is a good argument (for Germans) for supporting peripheral Eurozone countries because Germany — via the euro — has had a huge boost to its competitiveness,” Bailey said.

Even before the euro, when Germany’s currency was the mark, the country racked up huge trade surpluses. After it joined the euro on Jan. 1, 1999, it was presented with an effective devaluation, although this has fluctuated over the years as it strengthened and weakened against the dollar.

“With the euro it has run huge trade surpluses but its currency was fixed via its euro zone partners, giving it at least, say, a 20 to 25 percent competitiveness boost. No wonder German manufacturing — and its car making industry — is doing well and why Germany would want to stay part of the euro zone,” Bailey said.

While many major global economies are struggling to move out of recession, Germany has been booming. Germany’s gross domestic product in the third quarter rose a net 0.7 percent and by 3.9 percent compared with the same period of 2009.

Economists called this an export-led rebound, and said things would get even better for Germany because the nervousness surrounding the euro was weakening the currency and boosting its sales outside Europe. . . .

COMMENT: Indeed, the European Monetary Union is the realization of a plan for German world domination developed in the mid 19th century by Friedrich List. Its implementation followed upon the German economic conquest of Europe during World War II; its realization concisely  forecast by journalist Dorothy Thompson in 1940.

Dorothy Thompson’s analysis of Germany’s plans for world dominance entails implementation by the creation of a centralized European economic union. Ms. Thompson was writing in The New York Herald Tribune on May 31, 1940!

“The Germans have a clear plan of what they intend to do in case of victory. I believe that I know the essential details of that plan. I have heard it from a sufficient number of important Germans to credit its authenticity . . . Germany’s plan is to make a customs union of Europe, with complete financial and economic control centered in Berlin. This will create at once the largest free trade area and the largest planned economy in the world. In Western Europe alone . . . there will be an economic unity of 400 million persons . . . To these will be added the resources of the British, French, Dutch and Belgian empires. These will be pooled in the name of Europa Germanica . . .”

“The Germans count upon political power following economic power, and not vice versa. Territorial changes do not concern them, because there will be no ‘France’ or ‘England,’ except as language groups. Little immediate concern is felt regarding political organizations . . . . No nation will have the control of its own financial or economic system or of its customs. The Nazification of all countries will be accomplished by economic pressure. In all countries, contacts have been established long ago with sympathetic businessmen and industrialists . . . . As far as the United States is concerned, the planners of the World Germanica laugh off the idea of any armed invasion. They say that it will be completely unnecessary to take military action against the United States to force it to play ball with this system. . . . Here, as in every other country, they have established relations with numerous industries and commercial organizations, to whom they will offer advantages in co-operation with Germany. . . .”

Germany Plots with the Kremlin by T.H. Tetens; Henry Schuman [HC]; 1953; p. 92.

COMMENT: Writing in the 19th century, Friedrich List posited the idea of German-dominated central European economic union as a vehicle for establishing German economic and imperial superiority to Britain, Germany’s top geopolitical rival. List’s formulations are the basis for the German-dominated European Monetary Union. List understood that economic control led automatically to political control. That awareness is central to an understanding of the operations of the Bormann Capital Network.

“Many of the major elements of economic imperialism were enunciated in the 1840’s by the ubiquitous Friedrich List. List argued that overseas colonies were needed to supplement his favorite scheme for economic development: a central European economic union. He foresaw an economic organization with an industrialized Germany as its center and a periphery of other central and eastern European states that would supply food and raw materials for German industry and would purchase German industrial products. A semiautarkic structure would thus be created; it would have the advantage of permitting control, or even exclusion, of British competition, thus allowing central Europe to industrialize successfully in an orderly, planned manner.”

(The Ideological Origins of Nazi Imperialism; by Woodruff D. Smith; Copyright 1986 [SC]; Oxford University Press; ISBN 0-19-504741-9 (PBK); p. 30.)

Discussion

22 comments for “German Exporters: Keep the Euro”

  1. sorry to disagree. Yes cunning Germany kept her rates and wages low to increase her exports; but ensured all other EU rates were at highest level, hence each falling into near bankruptcy seeking rescue from unfairly prosperous Germany. I forecast in 2002, repeated in my blue book Germany’s Four Reichs Page 56 that germany planned breakup of Euro leaving her in complete mastery. Then invite all into DMark under total German domination in Superstate

    Posted by harry beckhough | January 3, 2011, 7:54 am
  2. Exactly. You’ve got it all covered. The European nations have fallen for this trick, willingly or unwillingly, unfortunately for them, and now they can’t get out of it. It is a trap. The union of all western European states was planned long in advance, as expressed here by Friedrich List. The bail out of weaker member states economies is certainly a burden on the German people but it is, after all, an opportunity for a take over: the one who pays calls the shots, like always. I love Europe and I am sorry that it has arrived to this mess.

    Posted by Claude | January 3, 2011, 10:19 am
  3. While it’s never a good idea to inhale car exhaust, if you’ve purchase a new diesel-powered Volkswagen car in the last six years you really don’t want to start huffing that tailpipe:

    USA Today
    EPA accuses Volkswagen, Audi of evading emission laws
    The German automaker adopted a “defeat device” to trick regulators, the EPA said.

    Nathan Bomey, 1:14 p.m. EDT September 18, 2015

    The Environmental Protection Agency on Friday accused Volkswagen of installing software on 482,000 diesel cars in the U.S. to evade federal emission regulations, potentially exposing people to harmful pollutants.

    The German automaker adopted what the EPA called a “defeat device” to trick U.S. regulators into believing that its cars met Clean Air Act standards, the federal agency said in a statement.

    The agency said the diesel cars that violated federal standard were the 2009-14 Volkswagen Jetta, Beetle and Golf, the 2014-15 Volkswagen Passat, and the 2009-15 Audi A3.

    Those cars emitted nitrogen oxides, which can exasperate respiratory conditions such as asthma, at up to 40 times the standard level, the EPA said.

    Volkswagen admitted to investigators that it had installed the defeat device, the EPA said.

    The automaker said in a statement that it’s cooperating with investigators but won’t comment further.

    Volkswagen, whose brands include the luxury Audi lineup, may face fines or other penalties, the EPA said. The maximum Clean Air Act violation is $37,500 per vehicle, meaning Volkswagen’s fine could technically be as high as $18 billion.

    What’s more, the scandal could expose Volkswagen to lawsuits and penalties for marketing its cars under the “Clean Diesel” moniker. An hour after the EPA announcement, the automaker’s website still contained the “Clean Diesel” branding.

    About 20% of Volkswagen’s vehicle sales are diesel engines, AutoPacific analyst Dave Sullivan said.

    “It totally goes against all of the marketing they have had of a clean diesel,” Sullivan said in an interview. “That’s one of the biggest selling points for Volkswagen.”

    The cars are still safe to drive, the EPA said, and owners do not need to take immediate action. But agency officials said they will require Volkswagen to fix the cars for free, indicating that a recall is likely.

    “We intend to hold Volkswagen responsible,” Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance, told reporters in a conference call.

    EPA regulators said that Volkswagen adopted a “sophisticated” algorithm that turned on vehicles’ full emissions controls when it detected they were being tested for emissions performance.

    EPA and California regulators discovered the device after researchers at West Virginia University and the International Council on Clean Transportation “raised questions about emissions levels” in Volkswagen cars, the federal agency said.

    Giles declined to say whether the EPA has made a criminal referral because of its findings. She said the investigation is ongoing and declined to say whether top executives knew about the device when it was installed.

    “I’m surprised that it took this long for somebody to find this out, but it was actually a very clever piece of software written to keep it hidden,” AutoPacific’s Dave Sullivan said.

    “It totally goes against all of the marketing they have had of a clean diesel…That’s one of the biggest selling points for Volkswagen.”

    Posted by Pterrafractyl | September 18, 2015, 2:31 pm
  4. It turns out you don’t have to actually inhale diesel exhaust to give yourself a major headache. Getting caught systematically hiding elevated levels of exhaust pollution for years will also do the trick:

    MSNBC
    VW’s stock plunges after diesel recall, with more woes to come

    By Paul A. Eisenstein
    09/21/15 02:29 PM

    Accused of cheating on emissions standards, Volkswagen saw a massive sell-off of its stock Monday, wiping out $16.9 billion of market value on Monday.

    VW and its upscale Audi brand have been ordered to recall nearly 500,000 diesel cars sold in the U.S. – but that is likely to be only the start of the problems facing the German maker.

    Within hours of the announcement on Friday from the Environmental Protection Agency, several high-profile law firms had already weighed in, threatening potentially costly class action lawsuits. That’s on top of multi-billion dollar fines Volkswagen could be subject to. The maker may also be targeted by the U.S. Justice Department for creating a so-called “defeat device” to get around strict diesel emissions standards.

    “I personally am deeply sorry that we have broken the trust of our customers and the public,” Volkswagen CEO Martin Winterkorn said in a statement issued over the weekend. “We at Volkswagen will do everything that must be done in order to re-establish the trust,” he said, adding that the maker will work openly with authorities investigating the alleged scam.

    The company also said it would stop sales of the 4-cylinder diesel engines involved in the recall, including the VW Jetta, Beetle and Golf models sold during the 2009 to 2014 model-years, the Audi A3 sold during the same period, and the 2014-15 VW Passat.

    VW has been offering consumers technology it claimed was clean, sporty and fuel-efficient. Diesel-equipped models like the Jetta and Golf have accounted for about 25% of the maker’s U.S. sales in recent years, and VW has been the leader in the reviving American diesel market.

    But according to the EPA, a number of Volkswagen and Audi vehicles equipped with 4-cylinder diesel engines were programmed to detect when they were undergoing emissions tests. Otherwise, the software deactivated some of the onboard pollution control equipment. The process apparently helped improve performance but resulted in the vehicles emitting up to 40 times the allowable levels of additional particulates and smog-causing oxides of nitrogen.

    The agency has ordered VW to fix the cars at its own expense but said car owners do not need to take any immediate action. The EPA insisted that the violations do not pose any safety hazard and said the cars remain legal to drive and sell while Volkswagen comes up with a plan to recall and repair them. However, it said the cars posed a threat to public health.

    The influential magazine Consumer Reports almost immediately suspended its “recommended” rating from the Jetta and Passat diesels until it can get a recall repair and re-test the cars.

    Neither VW nor EPA officials have yet said what it will take to fix the problem, though it is likely to start with changes to the onboard engine control software. The cost is expected to run into the millions of dollars. But that could be the least of VW’s financial worries.

    For one thing, the EPA could fine VW as much as $37,500 for each of the 482,000 recalled vehicles that violated clean air rules. That would work out to more than $18 billion. And the California Air Resources Board, or CARB, could levy its own penalties. Under U.S. law, California sets its own, tougher automotive emissions standards.

    Volkswagen is likely to also find itself in the crosshairs of the U.S. Justice Department, which has been taking a more aggressive stance on white collar crime, and has come down hard on the auto industry in recent years. It has levied major fines and sent a number of Japanese executives to prison for price fixing in the auto parts industry. In March 2014 it levied a $1.2 billion fine against Toyota for mishandling safety problems and last week accepted a $900 million settlement involving General Motors’ deadly ignition switch issue.

    Significantly, the EPA last Friday described the VW recall as an “opening salvo” into a broader investigation, and noted it is cooperating with both the Justice Dept. and the State of California.

    What is unclear is whether that implies that other manufacturers may also have developed ways to cheat on emissions tests. Diesels had all but vanished from the U.S. market starting in the early 1990s, regaining momentum only recently, and primarily through European brands such as Volkswagen, Audi and Daimler AG’s Mercedes-Benz.

    “We heard of the EPA’s accusations against VW from the press. The issue described by the press does not apply to Mercedes-Benz Cars,” Daimler said in an statement e-mailed to reports. It noted it was not aware of any investigation involving its own products.

    Meanwhile, the impact of the cheating scandal could stretch beyond U.S. borders. Michael Schroeren, a spokesman for Germany’s environmental ministry, told reporters in Berlin that authorities there intend to “check whether comparable manipulation has happened in Germany or Europe.”

    While Volkswagen faces potentially serious problems with federal regulators and prosecutors, there could be a costly civil side to the cheating scandal. Several law firms that specialize in large class action cases have already announced plans to look into the problem. That includes Seattle-based Hagens Berman Sobol Shapiro LLP, which took on both Toyota and GM over their safety problems.

    “The tinkering that Volkswagen will have to do by law to fix these vehicles will almost certainly degrade the performance to less than what Volkswagen claimed when it originally sold these cars,” said Steve Berman, a managing partner at Hagens Berman. He said that the use of a defeat device “blindsided” consumers who “went to great lengths” who wanted vehicles that were both clean and sporty.

    The EPA insisted that the violations do not pose any safety hazard and said the cars remain legal to drive and sell while Volkswagen comes up with a plan to recall and repair them. However, it said the cars posed a threat to public health.
    That’s quite a nuanced warning from the EPA. At least the affected cars aren’t extra likely to run you over, but you probably don’t want to be caught behind one while biking to work.

    And note the other warning from the EPA, the directed at the auto industry itself: This may not be limited to Volkswagen….or US regulators:


    Significantly, the EPA last Friday described the VW recall as an “opening salvo” into a broader investigation, and noted it is cooperating with both the Justice Dept. and the State of California.

    What is unclear is whether that implies that other manufacturers may also have developed ways to cheat on emissions tests. Diesels had all but vanished from the U.S. market starting in the early 1990s, regaining momentum only recently, and primarily through European brands such as Volkswagen, Audi and Daimler AG’s Mercedes-Benz.

    “We heard of the EPA’s accusations against VW from the press. The issue described by the press does not apply to Mercedes-Benz Cars,” Daimler said in an statement e-mailed to reports. It noted it was not aware of any investigation involving its own products.

    Meanwhile, the impact of the cheating scandal could stretch beyond U.S. borders. Michael Schroeren, a spokesman for Germany’s environmental ministry, told reporters in Berlin that authorities there intend to “check whether comparable manipulation has happened in Germany or Europe.”

    It’s also worth pointing out that VW overtook Toyota as the largest auto maker a few months ago, but one area where VW has been struggling in recent years, despite the devaluation of the euro, is the US automarket and VW’s performance has been so disappointing in the US that the company’s CEO, Martin Winterkorn, almost lost his job back in April. Yes, VW wasn’t doing that great in the US anyways, but it also may have just imploded its US brand’s reputation.

    So it’s looking like it’s going to be damage-control mode for VW for the foreseeable future as the company tries to explain why this was all just an innocent mistake. Good luck!

    Posted by Pterrafractyl | September 21, 2015, 2:39 pm
  5. Here’s an indication of how screwed Volkswagen might be following its diesel clean diesel scam scandal: The current mega-fine being bandied about is up to $18 billion, and that’s based on a max $37,500 fine for each of the 482,000 recalled cars. But as VW warns, the number of cars using the same type of engine globally, including the ‘special’ software, is closer to 11 million and most of the them are probably in Europe:

    The New York Times
    Volkswagen Says 11 Million Cars Worldwide Are Affected in Diesel Deception

    By JACK EWING
    SEPT. 22, 2015

    FRANKFURT — A scandal that has undermined Volkswagen in the United States spread to its core market of Europe on Tuesday, after the company said that 11 million of its diesel cars worldwide were equipped with software that was used to cheat on emissions tests.

    Volkswagen did not provide information on where the affected cars are, but the overwhelming majority are probably in Europe, where the company dominates the market and accounts for more than one of every four cars sold.

    The German automaker said it was setting aside the equivalent of half a year’s profits — 6.5 billion euros, or about $7.3 billion — to cover the cost of fixing the cars to comply with pollution standards and to cover other expenses, which are likely to include fines as well as responses to civil lawsuits from angry customers.

    The carmaker’s statement, on Tuesday morning here, was its first admission that diesel cars outside the United States may contain the software that led the Environmental Protection Agency to accuse the company of deliberately evading pollution tests. Previously, Volkswagen acknowledged only that the problem affected nearly 500,000 vehicles in the United States.

    The tampered vehicles use what is known as Type EA 189 engines, which are 2-liter engines. The company said on Tuesday that “a noticeable deviation between bench-test results and actual road use was established” for the engines.

    Volkswagen said it would also make “other efforts to win back the trust of our customers.”

    The number of cars involved suggests that the scale of the damage to Volkswagen’s reputation and its financial standing may be even greater than thought.

    Volkswagen shares fell by nearly 18 percent through late-afternoon trading in Frankfurt on Tuesday, after falling by 16 percent on Monday.

    The diesel cars were programmed to sense when emissions were being tested and to turn on equipment that reduced emissions, according to United States officials. At other times, the cars had better fuel economy and performance, but produced as much as 40 times the allowed amount of nitrogen oxide, a pollutant that can contribute to respiratory problems including asthma, bronchitis and emphysema.

    “Volkswagen is working intensely to eliminate these deviations through technical measures,” the company said.

    It is not clear, though, how fully Volkswagen might be able to correct the problem on the 11 million vehicles. The company could presumably alter the engines, so that the cars on the road begin actually meeting the required emissions standards. But doing so would probably degrade the vehicles’ fuel economy and performance, and might cause the engines to wear out sooner.

    The E.P.A. has said it will ask Volkswagen to recall almost a half-million vehicles sold in the United States from 2009 to 2015. The affected Golf, Passat, Jetta and Beetle cars were equipped with 2-liter diesel engines. Some Audi models also use the same diesel engine.

    Volkswagen has halted sales of cars with the engines in the United States.

    “It is not clear, though, how fully Volkswagen might be able to correct the problem on the 11 million vehicles. The company could presumably alter the engines, so that the cars on the road begin actually meeting the required emissions standards. But doing so would probably degrade the vehicles’ fuel economy and performance, and might cause the engines to wear out sooner”

    Posted by Pterrafractyl | September 22, 2015, 10:04 am
  6. BMW’s stock just took a plunge following reports that the diesel version of its X3 SUV exceeded the European limit for air pollution during a road test. It was 11 times the limit:

    Bloomber Business
    VW Scandal Threatens to Ensnare BMW as EU Urges Wider Probe

    German transport minister to check models across industry
    BMW shares plunge as much as 9.7% on X3 diesel report

    Naomi Kresge Tony Czuczka James G Neuger
    September 24, 2015 — 6:02 AM CDT
    Updated on September 24, 2015 — 7:37 AM CDT

    Volkswagen AG’s diesel-cheating affair deepened as the European Union urged all 28-member countries to start their own investigations and the scandal threatened to ensnare rival BMW AG.

    “We are inviting all member states to carry out investigations at the national level,” European Commission spokeswoman Lucia Caudet said in Brussels on Thursday. “We need to have the full picture whether and how many vehicles certified in the EU were equipped with defeat devices.”

    In Germany, the transport ministry said Thursday spot checks of vehicles would not be limited to Volkswagen, while BMW shares plunged after a report that a diesel version of the X3 sport utility vehicle emitted more than 11 times the European limit for air pollution in a road test.

    The entire auto industry and the methods used for testing vehicles are coming under scrutiny following revelations that VW’s “clean diesel” cars have software intended to defeat emissions tests. The European automakers’ lobby group, the ACEA, on Wednesday placed the blame in VW’s court, issuing a statement saying that “there is no evidence this is an industry-wide issue.”

    German Probe

    Germany’s motor vehicle administration “will concentrate its investigations not only on the Volkswagen models in question but will also do spot checks of other car manufacturers,” Transport Minister Alexander Dobrindt told reporters in Berlin.

    Emissions measured in road tests of 15 new diesel cars were an average of about seven times higher than European limits, according to a study published last October by the International Council on Clean Transportation, the same group whose tipoff led U.S. regulators to investigate a gap between VW diesels’ emissions in tests and on the road.

    ICCT also found a gap between real-world and lab performance in BMW’s X3, Germany’s Autobild magazine reported. BMW said that there’s no system in its cars that responds to tests differently than it would operate on the road.

    “The BMW Group does not manipulate or rig any emissions tests,” the Munich-based company said in a statement in response to the report. “We observe the legal requirements in each country.”

    “Emissions measured in road tests of 15 new diesel cars were an average of about seven times higher than European limits, according to a study published last October by the International Council on Clean Transportation, the same group whose tipoff led U.S. regulators to investigate a gap between VW diesels’ emissions in tests and on the road.”

    Posted by Pterrafractyl | September 24, 2015, 9:07 am
  7. Here’s a reminder that as the VW scandal potentially grows to include other manufacturers, the scandal just might start hitting government regulators too. At least, it should:

    The Guardian
    UK, France and Germany lobbied for flawed car emissions tests, documents reveal

    Exclusive: Countries publicly calling for investigations into VW emissions rigging scandal have privately fought to keep loopholes in car tests for carbon emissions

    Arthur Neslen

    Thursday 24 September 2015 01.00 EDT

    The UK, France and Germany have been accused of hypocrisy for lobbying behind the scenes to keep outmoded car tests for carbon emissions, but later publicly calling for a European investigation into Volkswagen’s rigging of car air pollution tests.

    Leaked documents seen by the Guardian show the three countries lobbied the European commission to keep loopholes in car tests that would increase real world carbon dioxide emissions by 14% above those claimed.

    Just four months before the VW emissions scandal broke, the EU’s three biggest nations mounted a push to carry over loopholes from a test devised in 1970 – known as the NEDC – to the World Light Vehicles Test Procedure (WLTP), which is due to replace it in 2017.

    “It is unacceptable that governments which rightly demand an EU inquiry into the VW’s rigging of air pollution tests are simultaneously lobbying behind the scenes to continue the rigging of CO2 emissions tests,” said Greg Archer, clean vehicles manager at the respected green thinktank, Transport and Environment (T&E). “CO2 regulations should not be weakened by the backdoor through test manipulations.”

    Vehicle emissions are responsible for 12% of Europe’s carbon emissions and by 2021, all new cars must meet an EU emissions limit of 95 grams of CO2 per km, putting accurate measurements of real emissions at a premium.

    The loopholes would not only raise real world CO2 emissions from new cars to 110g CO2 per km – well above the EU limit – but increase fuel bills for drivers by €140 per year according T&E.

    Huw Irranca-Davies, Labour MP and chair of an influential select committee of MPs, the environmental audit committee, said: “Given that the UK is struggling to bring down carbon emissions and other harmful pollutants from road vehicles it is extremely worrying that the UK government appears to be trying to water down the EU’s proposed new road testing regime.

    “As well as cutting CO2 emissions, improving the efficiency of vehicles can save lives by reducing the illegal levels of air pollution in UK cities, so the Department for Transport should be making these tests more rigorous not less.”

    The WLTP test was supposed to remove loopholes that had allowed a gap between real world CO2 emissions and test cycle ones to develop, which EU consultants have estimated at up to 20%.

    But the UK lobbied for car makers to be allowed to exploit flexibilities such as externally charging their batteries to full before testing. The Department for Transport also argued that the best available technologies should be shunned in favour of outdated ‘inertia classes’, which involve manually adding 100 kilo weights to the car to see what effect greater weight on the amount of CO2 the car pumps out.

    Research by the International Council on Clean Transportation has found that car manufacturers often game these tests by optimising test car performances at one pound below the desired inertia class.

    Germany went further than the UK, calling for the tests to be conducted on sloping downhill tracks, and for allowing manufacturers to declare a final CO2 value 4% lower than the one measured. France supported all the proposed loopholes, bar the 4% lower CO2 value.

    Together, these flexibilities would allow some 14% more CO2 to be emitted than EU regulations permit, according to an analysis by T&E. CO2 emissions contribute to climate change, while the nitrogen oxides (NOx) that VW rigged tests for are primarily a cause of local air pollution.

    In a letter to the European commission on 29 May, Bob Moran, the Department for Transport’s head of regulation and R&D argued that a ‘correlation tool’ between the old and new tests should include the old procedures for inertia classes and battery recharges.

    “It appears to be a common position under NEDC test conditions that manufacturers will (request to) recharge the battery during the soak period, or (request to) replace a partially depleted battery with a fully charged one at the start of the test proper,” he wrote. “We believe this commonly used approach should be reflected in the correlation tool.”

    France backed this position for technical reasons, arguing that it provided “repeatable information”. But a fully-charged battery also prevents a car’s alternator from kicking in and releasing carbon emissions during tests, as would happen in real world driving situations.

    In a sign of growing anger at the VW emissions-rigging scandal, which saw Martin Winterkorn resign on Wednesday, the European parliament’s environment committee voted earlier today for real world air pollutant emissions tests to begin no later than 2017.

    The panel of MEPs also demanded that no loopholes or deviations be allowed for pollution limits.

    You have to love the “we just want to recharge our batteries for the sake of repeatability” argument:


    But the UK lobbied for car makers to be allowed to exploit flexibilities such as externally charging their batteries to full before testing. The Department for Transport also argued that the best available technologies should be shunned in favour of outdated ‘inertia classes’, which involve manually adding 100 kilo weights to the car to see what effect greater weight on the amount of CO2 the car pumps out.

    Research by the International Council on Clean Transportation has found that car manufacturers often game these tests by optimising test car performances at one pound below the desired inertia class.

    Germany went further than the UK, calling for the tests to be conducted on sloping downhill tracks, and for allowing manufacturers to declare a final CO2 value 4% lower than the one measured. France supported all the proposed loopholes, bar the 4% lower CO2 value.

    Together, these flexibilities would allow some 14% more CO2 to be emitted than EU regulations permit, according to an analysis by T&E. CO2 emissions contribute to climate change, while the nitrogen oxides (NOx) that VW rigged tests for are primarily a cause of local air pollution.

    “It appears to be a common position under NEDC test conditions that manufacturers will (request to) recharge the battery during the soak period, or (request to) replace a partially depleted battery with a fully charged one at the start of the test proper,” he wrote. “We believe this commonly used approach should be reflected in the correlation tool.”

    France backed this position for technical reasons, arguing that it provided “repeatable information”. But a fully-charged battery also prevents a car’s alternator from kicking in and releasing carbon emissions during tests, as would happen in real world driving situations.

    “But a fully-charged battery also prevents a car’s alternator from kicking in and releasing carbon emissions during tests, as would happen in real world driving situations.”

    Posted by Pterrafractyl | September 25, 2015, 10:00 am
  8. According to a German Green Party MP, the German government told the MPs about this issue back in July. But that wasn’t all it did: “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper”

    The Telegraph
    German government ‘knew VW was rigging emissions test’
    Opposition party claims the German government knew that Volkswagen had fitted cheat devices to its cars

    By Justin Huggler in Berlin

    11:56AM BST 23 Sep 2015

    The German government knew Volkswagen was rigging its emissions tests and did nothing to stop it, an opposition party has alleged.

    The German Green Party claimed Angela Merkel’s government admitted that it knew about VW’s test rigging software in an answer to a parliamentary question in July.

    “The government told us in July that it knew about this software, which has been used in the USA, and it’s clear they knew the software was widely in use,” Oliver Krischer, the deputy leader of the Greens told N24 television.

    “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper,” Mr Krischer alleged.

    The claim centres on a written answer the German transport ministry gave on July 28 to a question from the Greens about “defeat devices”, the industry name for the software that allowed VW to cheat emissions tests.

    The claim that Mrs Merkel’s government knew VW was rigging its emissions tests was backed by a forum of German environmental businesses.

    “The federal ministry of transport has not once checked the information provided by the manufacturer in recent in years,” Jürgen Resch, the head of Deustche Unwelthilfe, said.

    Alexander Dobrind, the transport minister, has denied the government failed to monitor the car industry.

    “Again and again we conduct testing. If there are irregularities, we discuss them immediately with the auto manufacturer according to the rules,” he told reporters on Tuesday.

    Mr Dobrint has ordered an immediate inquiry into the VW scandal.

    “Our inquiry will investigate whether the vehicles in question were built and tested within the existing German and European legislation,” he said.

    But the Green Party stood by its claims.

    “It is surprising to see how Mr Dobrindt acts shocked at the news in recent days, when in July he was very well informed about the situation,” Mr Krischer said.

    “The VW emissions scandal is the result of a policy in which environmental and consumer protection are no longer important, and tricks and deceits are accepted with a wink.”

    Keep in mind that when you read:


    “The government told us in July that it knew about this software, which has been used in the USA, and it’s clear they knew the software was widely in use,” Oliver Krischer, the deputy leader of the Greens told N24 television.

    “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper,” Mr Krischer alleged.

    that software hasn’t just been used in the USA:

    Reuters
    VW Emissions Test Cheating More Widespread in Germany: Official

    Sep 25 2015, 11:58 am ET

    WOLFSBURG, Germany — Volkswagen rigged emission tests on about 2.8 million diesel vehicles in Germany, the country’s transport minister said on Friday, nearly six times as many as it has admitted to falsifying in the United States.

    His comments, pointing to cheating on a bigger scale than previously known, deepened the crisis at the world’s largest automaker as its supervisory board held a crucial meeting.

    The board is widely expected to name Matthias Mueller, the head of its Porsche sports-car division, as chief executive to replace Martin Winterkorn, who quit on Wednesday, and at least four senior executives are expected to be purged.

    The scandal keeps growing. German Transport Minister Alexander Dobrindt said on Thursday Volkswagen had also cheated tests in Europe, where its sales are much higher, and on Friday put the number of affected vehicles in Germany at 2.8 million.

    Regulators and prosecutors across the world are investigating the scandal.

    The wider car market has been rocked, with manufacturers fearing a drop in sales of diesel cars and tighter regulations, while customers and motor dealers are furious that Volkswagen has yet to say whether it will have to recall any cars.

    “VW needs to be very open about what has happened, how it was possible that this could happen to make sure that this never happens again in the future,” said a leading Volkswagen shareholder, underlining the importance of the board meeting. “These are priorities that should override all other considerations at the moment.”

    The task facing Mueller, if his selection is confirmed, is huge.

    The company said on Tuesday 11 million vehicles worldwide were fitted with the software that allowed it to cheat U.S. tests, while adding it was not turned on in the bulk of them.

    Analysts hope that on Friday it may at last say which models and construction years are affected, and whether cars will need to be refitted. They also expect it to announce a full investigation of the scandal, with German newspaper Handelsblatt saying it planned to hire U.S. law firm Jones Day to lead a no holds barred inquiry, and to give the outlines of a new management structure likely to be less centralized, but with a clearer system of checks.

    Volkswagen has long been seen as a symbol of German industrial prowess and the auto industry is one of the country’s major employers and a key source of export revenue.

    Earlier this month, Volkswagen delivered a presentation to investors at the annual Frankfurt motor show entitled “Stability in Volatile Times.” Now German Chancellor Angela Merkel is urging it to act quickly to restore confidence in the Volkswagen name.

    So over 400,000 cars are running that software in the US, and 2.8 million in Germany apparently, but VW asserts that, while 11 million vehicles worldwide were fitted with the software, it’s not turned on in the bulk of them:


    The company said on Tuesday 11 million vehicles worldwide were fitted with the software that allowed it to cheat U.S. tests, while adding it was not turned on in the bulk of them.

    And this, or course, raises the question of whether having the “defeat device” software turned off just leaves the cars in high-emmission mode or low-emmission mode permanently. It’s not really clear:

    Reuters
    Factbox: Diesel engines and how VW’s ‘defeat device’ worked
    Mon Sep 21, 2015 4:46pm EDT

    Germany’s Volkswagen (VOWG_p.DE), the world’s largest automaker by sales, has admitted it had rigged emissions tests in diesel-powered vehicles in the United States and U.S. authorities said on Monday they would widen their probe to other automakers.

    The following are some facts about diesel car engines, the tailpipe pollution they emit and the “defeat device” software that federal regulators say VW used to circumvent emissions standards set by the U.S. Environmental Protection Agency (EPA) and the state of California.

    COST – Because of the extra equipment and process needed to clean their diesel exhaust, diesel cars are more expensive than their gasoline counterparts.

    VW’S DEFEAT DEVICE – The software switched on when the automobiles were being tested for compliance with EPA standards, turning off during normal driving to allow maximum engine performance. The algorithm used information about how the car was being steered, how long the engine ran and atmospheric pressure to “precisely track” the conditions that corresponded to a federal emissions test, according to the EPA.

    So for the bulk of the 11 million cars that have the “defeat device” software installed but apparently not “turned on”, wouldn’t the performance of those models have been far worse than the same models in US or European if turning “off” the software somehow neutralized? Don’t forget that the “defeat device” allowed those cars to meet their advertised fuel efficiency and performance, so if that software was “turned off” for the bulk of those 11 million cars, should they have been drastically underperforming their advertised performance? And wouldn’t consumers have discovered this by now that was the case?

    Posted by Pterrafractyl | September 25, 2015, 1:36 pm
  9. According to a German Green Party MP, the German government told the MPs about this issue back in July. But that wasn’t all it did: “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper”

    The Telegraph
    German government ‘knew VW was rigging emissions test’
    Opposition party claims the German government knew that Volkswagen had fitted cheat devices to its cars

    By Justin Huggler in Berlin

    11:56AM BST 23 Sep 2015

    The German government knew Volkswagen was rigging its emissions tests and did nothing to stop it, an opposition party has alleged.

    The German Green Party claimed Angela Merkel’s government admitted that it knew about VW’s test rigging software in an answer to a parliamentary question in July.

    “The government told us in July that it knew about this software, which has been used in the USA, and it’s clear they knew the software was widely in use,” Oliver Krischer, the deputy leader of the Greens told N24 television.

    “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper,” Mr Krischer alleged.

    The claim centres on a written answer the German transport ministry gave on July 28 to a question from the Greens about “defeat devices”, the industry name for the software that allowed VW to cheat emissions tests.

    The claim that Mrs Merkel’s government knew VW was rigging its emissions tests was backed by a forum of German environmental businesses.

    “The federal ministry of transport has not once checked the information provided by the manufacturer in recent in years,” Jürgen Resch, the head of Deustche Unwelthilfe, said.

    Alexander Dobrind, the transport minister, has denied the government failed to monitor the car industry.

    “Again and again we conduct testing. If there are irregularities, we discuss them immediately with the auto manufacturer according to the rules,” he told reporters on Tuesday.

    Mr Dobrint has ordered an immediate inquiry into the VW scandal.

    “Our inquiry will investigate whether the vehicles in question were built and tested within the existing German and European legislation,” he said.

    But the Green Party stood by its claims.

    “It is surprising to see how Mr Dobrindt acts shocked at the news in recent days, when in July he was very well informed about the situation,” Mr Krischer said.

    “The VW emissions scandal is the result of a policy in which environmental and consumer protection are no longer important, and tricks and deceits are accepted with a wink.”

    Keep in mind that when you read:


    “The government told us in July that it knew about this software, which has been used in the USA, and it’s clear they knew the software was widely in use,” Oliver Krischer, the deputy leader of the Greens told N24 television.

    “The government worked with the auto industry, not to see that emissions levels were reduced, but so that the measuring system was set up to allow the cars meet the necessary standards on paper,” Mr Krischer alleged.

    that software hasn’t just been used in the USA:

    Reuters
    VW Emissions Test Cheating More Widespread in Germany: Official

    Sep 25 2015, 11:58 am ET

    WOLFSBURG, Germany — Volkswagen rigged emission tests on about 2.8 million diesel vehicles in Germany, the country’s transport minister said on Friday, nearly six times as many as it has admitted to falsifying in the United States.

    His comments, pointing to cheating on a bigger scale than previously known, deepened the crisis at the world’s largest automaker as its supervisory board held a crucial meeting.

    The board is widely expected to name Matthias Mueller, the head of its Porsche sports-car division, as chief executive to replace Martin Winterkorn, who quit on Wednesday, and at least four senior executives are expected to be purged.

    The scandal keeps growing. German Transport Minister Alexander Dobrindt said on Thursday Volkswagen had also cheated tests in Europe, where its sales are much higher, and on Friday put the number of affected vehicles in Germany at 2.8 million.

    Regulators and prosecutors across the world are investigating the scandal.

    The wider car market has been rocked, with manufacturers fearing a drop in sales of diesel cars and tighter regulations, while customers and motor dealers are furious that Volkswagen has yet to say whether it will have to recall any cars.

    “VW needs to be very open about what has happened, how it was possible that this could happen to make sure that this never happens again in the future,” said a leading Volkswagen shareholder, underlining the importance of the board meeting. “These are priorities that should override all other considerations at the moment.”

    The task facing Mueller, if his selection is confirmed, is huge.

    The company said on Tuesday 11 million vehicles worldwide were fitted with the software that allowed it to cheat U.S. tests, while adding it was not turned on in the bulk of them.

    Analysts hope that on Friday it may at last say which models and construction years are affected, and whether cars will need to be refitted. They also expect it to announce a full investigation of the scandal, with German newspaper Handelsblatt saying it planned to hire U.S. law firm Jones Day to lead a no holds barred inquiry, and to give the outlines of a new management structure likely to be less centralized, but with a clearer system of checks.

    Volkswagen has long been seen as a symbol of German industrial prowess and the auto industry is one of the country’s major employers and a key source of export revenue.

    Earlier this month, Volkswagen delivered a presentation to investors at the annual Frankfurt motor show entitled “Stability in Volatile Times.” Now German Chancellor Angela Merkel is urging it to act quickly to restore confidence in the Volkswagen name.

    So over 400,000 cars are running that software in the US, and 2.8 million in Germany apparently, but VW asserts that, while 11 million vehicles worldwide were fitted with the software, it’s not turned on in the bulk of them:


    The company said on Tuesday 11 million vehicles worldwide were fitted with the software that allowed it to cheat U.S. tests, while adding it was not turned on in the bulk of them.

    And this, or course, raises the question of whether having the “defeat device” software turned off just leaves the cars in high-emmission mode or low-emmission mode permanently. It’s not really clear:

    Reuters
    Factbox: Diesel engines and how VW’s ‘defeat device’ worked
    Mon Sep 21, 2015 4:46pm EDT

    Germany’s Volkswagen (VOWG_p.DE), the world’s largest automaker by sales, has admitted it had rigged emissions tests in diesel-powered vehicles in the United States and U.S. authorities said on Monday they would widen their probe to other automakers.

    The following are some facts about diesel car engines, the tailpipe pollution they emit and the “defeat device” software that federal regulators say VW used to circumvent emissions standards set by the U.S. Environmental Protection Agency (EPA) and the state of California.

    COST – Because of the extra equipment and process needed to clean their diesel exhaust, diesel cars are more expensive than their gasoline counterparts.

    VW’S DEFEAT DEVICE – The software switched on when the automobiles were being tested for compliance with EPA standards, turning off during normal driving to allow maximum engine performance. The algorithm used information about how the car was being steered, how long the engine ran and atmospheric pressure to “precisely track” the conditions that corresponded to a federal emissions test, according to the EPA.

    So for the bulk of the 11 million cars that have the “defeat device” software installed but apparently not “turned on”, wouldn’t the performance of those models have been far worse than the same models in US or European if turning “off” the software somehow neutralized the emmissions trickery? Don’t forget that the “defeat device” allowed those cars to meet their advertised fuel efficiency and performance, so if that software was “turned off” for the bulk of those 11 million cars, should they have been drastically underperforming their advertised performance? And wouldn’t consumers have discovered this by now that was the case?

    Posted by Pterrafractyl | September 25, 2015, 1:37 pm
  10. If you have to be thrown under a bus, a nice adorable VW Bus is clearly your bus-to-run-over-you of choice, especially if its filled with hippies since they’ll probably have various painkilling pain distracting substances on board.

    But if you’re a VW executive at risk of getting thrown under the metaphorical VW Bus, there’s a much better option available: throw your technicians and engineers under the VW Bus first, and hope that stops its momentum before it hits you:

    The Guardian
    VW scandal: staff suspended as car giant appoints new CEO

    Veteran head of Porsche division Matthias Müller takes over car giant and blames ‘small group’ of staff for emissions scandal

    Graham Ruddick and Sean Farrell

    Friday 25 September 2015 14.39 EDT

    Volkswagen has blamed its emissions scandal on a “small group” of people and has suspended a number of staff as Matthias Müller was unveiled as its new chief executive.

    Müller, who has been promoted from his role as boss of Porsche, pledged to leave “no stone unturned” and “maximum transparency” in an investigation into how the company cheated emissions tests on diesel cars. The new VW boss did not reveal how many staff had been suspended or who they were, but the company said the scandal was the result of “unlawful behaviour of engineers and technicians involved in engine development”.

    Bernd Osterloh, chairman of VW’s work council and a member of the executive committee, said: “A small group has done damage to our company. We need a climate where mistakes are not hidden.”

    Müller and Osterloh were speaking at a press conference to unveil the new boss of the troubled German carmaker. The 62-year-old was elected by the VW board at a meeting on Friday to replace Martin Winterkorn, who resigned following revelations in the US that Volkswagen installed software in its cars to disguise illegal emission levels.

    “My most urgent task is to win back trust for the Volkswagen Group – by leaving no stone unturned and with maximum transparency, as well as drawing the right conclusions from the current situation,” Müller said.

    Müller faces a major challenge in rebuilding VW. The company has admitted that 11m cars were fitted with defeat devices and set aside €6.5bn (£4.8bn) to pay for the costs of the crisis. However, it also faces the prospect of fines of up to $18bn (£11.8bn) from US regulators and one of the biggest legal claims in history from customers and shareholders around the world.

    Berthold Huber, the acting head of VW’s supervisory board, called the crisis a “moral and policy disaster”. The carmaker has called an extraordinary shareholder meeting for 9 November.

    “The supervisory board has, on the basis of current information, recommended suspending some employees immediately until the whole case is cleared up,” Huber said. “This has in part already happened.

    “The test manipulations are a moral and political disaster for Volkswagen. The unlawful behaviour of engineers and technicians involved in engine development shocked Volkswagen just as much as it shocked the public. We can only apologise and ask our customers, the public, the authorities and our investors to give us a chance to make amends.”

    In further developments on Friday, the German government said that 2.8m of the 11m cars installed with the defeat device were sold in Germany and that commercial vehicles were also involved. Documents also emerged that showed EU offices knew two years ago that devices could skew emissions tests, and the US’s Environmental Protection Agency warned that it would step up its emissions test against all carmakers and that VW faced “massive fines”.

    In addition, Bloomberg reported that key parts of the faked emissions tests had been overseen by VW executives based in the company’s headquarters in Wolfsburg.

    Herbert Diess, head of the Volkswagen brand, said that 5m of the 11m cars affected were Volkswagen passenger cars, including the sixth-generation Golf and the seventh-generation Passat.

    Diess said: “We are working at full speed on a technical solution that we will present to partners, to our customers and to the public as swiftly as possible. Our aim is to inform our customers as quickly as possible, so that their vehicles comply fully with regulations.”

    Shares in VW fell by a further 4%. This means that roughly €25bn, or one-third, has been wiped off the value of the carmaker this week.

    Analysts at UBS warned that if the crisis worsened it could signal the eventual end of the combustion engine. Julie Hudson at UBS said: “Should transport emissions become too difficult to regulate because of the difficulty of amassing accurate data, we think this might go way beyond the diesel engine, to accelerate the demise of the combustion engine.”

    It was all just “a small group” of engineers and technicians (who were overseen by executives at the company headquarters). Shame on those engineers and technicians…and only those engineers and technicians:


    Müller, who has been promoted from his role as boss of Porsche, pledged to leave “no stone unturned” and “maximum transparency” in an investigation into how the company cheated emissions tests on diesel cars. The new VW boss did not reveal how many staff had been suspended or who they were, but the company said the scandal was the result of “unlawful behaviour of engineers and technicians involved in engine development”.

    Bernd Osterloh, chairman of VW’s work council and a member of the executive committee, said: “A small group has done damage to our company. We need a climate where mistakes are not hidden.”


    In further developments on Friday, the German government said that 2.8m of the 11m cars installed with the defeat device were sold in Germany and that commercial vehicles were also involved. Documents also emerged that showed EU offices knew two years ago that devices could skew emissions tests, and the US’s Environmental Protection Agency warned that it would step up its emissions test against all carmakers and that VW faced “massive fines”.

    In addition, Bloomberg reported that key parts of the faked emissions tests had been overseen by VW executives based in the company’s headquarters in Wolfsburg.

    Yes, it’s going to be a bumpy ride for the VW Bus…although it should smooth out before it hits the important bumps.

    Posted by Pterrafractyl | September 26, 2015, 11:51 am
  11. As the investigations in the Volkswagen emission scam scandal proceeds, one of the key questions that all impacted parties are going to be interested is it the classic “what did they know, and when did they know it?” And based the follow, we can at least sort of answer those questions: The board of executives knew something was wrong in 2011 because it received warnings warnings from its own technicians. And it may was also warned by auto parts supplier Bosch that the Bosch software could be used illegally as early as 2007, two years before the illegal software was installed in VW vehicles:

    Reuters
    Volkswagen Was Warned of Emissions Cheating Years Ago: Reports

    9/27/15 at 10:04 AM

    BERLIN/ROME (Reuters) – Volkswagen’s own staff and one of its suppliers warned years ago about software designed to thwart emissions tests, two German newspapers reported on Sunday, as the automaker tries to uncover how long its executives knew about the cheating.

    The world’s biggest automaker is adding up the cost to its business and reputation of the biggest scandal in its 78-year history, having acknowledged installing software in diesel engines designed to hide their emissions of toxic gasses.

    Countries around the world have launched their own investigations after the company was caught cheating on tests in the United States. Volkswagen says the software affected engines in 11 million cars, most of which were sold in Europe.

    sThe company’s internal investigation is likely to focus on how far up the chain of command were executives who were responsible for the cheating, and how long were they aware of it.

    The Frankfurter Allgemeine Sonntagszeitung, citing a source on VW’s supervisory board, said the board had received an internal report at its meeting on Friday showing VW technicians had warned about illegal emissions practices in 2011. No explanation was given as to why the matter was not addressed then.

    Separately, Bild am Sonntag newspaper said VW’s internal probe had turned up a letter from parts supplier Bosch written in 2007 that also warned against the possible illegal use of Bosch-supplied software technology. The paper did not cite a source for its report.

    Volkswagen declined to comment on the details of either newspaper report.

    “There are serious investigations underway and the focus is now also on technical solutions” for customers and dealers, a Volkswagen spokesman said. “As soon as we have reliable facts we will be able to give answers.”

    A spokesman for Bosch said the company’s dealings with VW were confidential.

    Bild said Martin Winterkorn, who quit as Volkswagen CEO last week, was demanding his salary for the rest of his contract through the end of next year but the board did not want to pay it. It cited no source. Winterkorn was paid 16 million euros last year, the most of any CEO in Germany’s blue chip DAX index.

    SALES HALT IN ITALY

    Volkswagen is still coming up with plans to deal with the 11 million cars that it built with the affected engines.

    Its Italian unit has told its dealers to stop selling them, Italy’s Corriera della Sera newspaper reported on Sunday. It said that would leave 40,000 cars stuck on Italian lots.

    “As a precautionary measure, we ask that you suspend immediately the sale, registration and delivery only of vehicles carrying the Euro 5, EA 189 motor,” the newspaper quoted Massimo Nordio, chief executive office of Volkswagen’s Italian unit, as writing in a letter to dealers.

    A Volkswagen spokesman said there had been no instructions from company headquarters in Germany to dealers to stop selling the affected cars, but sales units in individual countries had the right to take such decisions on their own.

    Italy’s Volkswagen headquarters in Verona did not immediately respond to calls.

    In Volkswagen’s home market Germany, where 2.8 million of the 11 million affected diesel cars are on the road, the government watchdog KBA has set an October 7 deadline for the company to present a plan to bring diesel emissions into line with the law, Bild reported.

    POLITICAL PRESSURE

    German politicians have been adding to the pressure on Volkswagen, worried about the reputation of German industry.

    “We need a guarantee that cars of German manufacturers are in line with the norms, without manipulation,” Chancellor Angela Merkel’s chief of staff Peter Altmaier told Der Tagesspiegelin an interview published on Sunday.

    Environment Minister Barbara Hendricks said the scandal must not be allowed to tarnish “the made in Germany brand.”

    “If a global player from Germany violates environment protection rules that blatantly, this casts a shadow on the environment pledges of German companies,” she told Handelsblatt newspaper in an interview to be published on Monday.

    She said the European Union was working on stricter emissions tests to focus more on normal road conditions, rather than rely on lab results.

    Diesel engines use less fuel and emit less carbon—blamed for global warming—than standard gasoline engines. But they emit higher levels of toxic gasses known as nitrogen oxides, blamed for deaths from lung and heart disease.

    In most of the world, including the United States, diesel engines in passenger cars are a niche product. But their fuel economy and low carbon emissions have made them popular in Europe, where they now account for half of vehicles sold.

    Volkswagen and other European manufacturers have promoted “clean diesel” technology, benefiting from diesel’s fuel economy but meeting stringent tests for emissions of toxins. But the suggestion that this was achieved by cheating on tests could affect the viability of the entire diesel sector and the fate of companies that have bet on it.

    “In most of the world, including the United States, diesel engines in passenger cars are a niche product. But their fuel economy and low carbon emissions have made them popular in Europe, where they now account for half of vehicles sold.

    Posted by Pterrafractyl | September 28, 2015, 4:48 pm
  12. Volkswagen just released the number of cars in the UK running with the “defeat device” software installed: 1.2 million:

    The Guardian
    VW emissions scandal: 1.2m UK cars affected

    German carmaker admits scale of problem in Britain for first time with Audis, Seats and Škodas among vehicles fitted with defeat devices

    Graham Ruddick

    Wednesday 30 September 2015 06.26 EDT

    Volkswagen has revealed that almost 1.2m vehicles in the UK are involved in the diesel emissions scandal that has rocked the carmaker, meaning more than one in 10 diesel cars on the country’s roads are affected.

    VW said the diesel vehicles include 508,276 Volkswagen cars, 393,450 Audis, 76,773 Seats, 131,569 Škodas and 79,838 Volkswagen commercial vehicles. The total number of vehicles affected is 1,189,906.

    This is the first time VW has admitted how many of the 11m vehicles fitted with a defeat device to cheat emissions tests are in the UK.

    The admission means that the UK is one of the countries worst affected by the scandal and will increase the pressure on the government to launch a full investigation.

    Figures from the Department for Transport show that there were 10.7m diesel cars on Britain’s roads at the end of 2014 and that an estimated 5.3m of the petrol and diesel cars are Volkswagens or one of the groups’ sister brands.

    Patrick McLoughlin, the transport secretary, said: “The government’s priority is to protect the public and I understand VW are contacting all UK customers affected. I have made clear to the managing director this needs to happen as soon as possible.

    “The government expects VW to set out quickly the next steps it will take to correct the problem and support owners of these vehicles already purchased in the UK.”

    VW said 2.8m vehicles in Germany are involved, while 482,000 cars have been recalled in the US.

    That’s a lot of cars! And pollution. So much that you have to wonder how this could impact the relations between Germany and UK with the UK’s referendum on staying in the EU yet to come…especially since David Cameron reportedly did a U-turn on new EU emission limits back in 2013 that he had previously supported as a personal favor to Angela Merkel:

    The Independent
    Car emissions: Government under attack over Cameron’s testing favour to Merkel

    Former transport minister claims Mr Cameron buckled to pressure from German Chancellor to delay new emissions limits

    Jamie merrill
    Saturday 26 September 2015 19:04 BST

    The Government is facing a political row over the independence and effectiveness of Britain’s automotive testing regime as the fallout from the Volkswagen emissions scandal continues to spread across Europe.

    The former Liberal Democrat transport minister Norman Baker has claimed David Cameron buckled to pressure from German Chancellor Angela Merkel to delay new emissions limits.

    Mr Baker, who served as transport minister from 2010 to 2013, said that Ms Merkel had personally telephoned the Prime Minister and called in a favour to protect her country’s car industry. He said that Mr Cameron’s U-Turn over EU emissions regulation had provoked “fury” within Government and from UK car firms.

    “We had negotiated a good deal which both reduced overall emissions and had protections for niche British carmakers such as Aston Martin, but the Germans wanted super credits added back in, which are of no use to our manufactures but were very useful to BMW and Daimler, said Mr Baker.

    Super credits are a clause in EU rules for rewarding a large manufacturer with permission to make high-emitting gas guzzlers if it also manufactures a certain number of electric cars or low emissions vehicles. Campaigners say the system has allowed large car makers to continue to produce high CO2 emitting vehicle in exchange for producing a small number of lower emissions vehicles.

    Mr Baker added: “Having got the deal David Cameron then unpicked it. Merkel rang up and wanted a favour and idiotically he said yes. He damaged the British car industry and damaged the environment. It was Number 10 failing to involve [government] departments as usual that caused the problem.”

    The chairman of the Commons Transport Committee, Louise Ellman, said Mr Baker’s claims raised a “very big questions” about outside influence on policy. “There is certainly a major question about the influence of the motor industry against the interests of the public,” she told the BBC Radio 4 Today programme. “Testing should be independent of manufacturers and of government and it doesn’t seem that that has been the case.”

    Mr Baker’s claim came after Britain’s leading car data analyst told the Independent on Sunday that there would be “carnage” if the VW scandal spread to emissions and pollutions testing.

    Nick Molden, founder of Emission Analytics, said: “If widespread illegality is found among car manufacturers in Europe then all bets are off. There will be such carnage.”

    A Government spokesperson refused to deny the claims by Mr Baker, but said the EU-wide negotiations over new C02 targets are “an entirely different issue to manufactures illegally falsifying emissions tests.” However fuel efficiency and emissions standards are increasingly being linked amid fierce criticism of the EU’s approach to automotive testing.

    Elsewhere in Europe the VW emissions scandal continued to cause disruption, as Switzerland banned the sales of VW, Audi, Seat and Skoda diesel cars fitted with the affected VW Group engines, in a move that will shelve 180,000 vehicles that are in the country but yet to be sold. In the UK there are increasing concerns among large fleet operators over the fallout from the VW scandal and possible knock-on effects for second-hand car values.

    “Government spokesperson refused to deny the claims by Mr Baker, but said the EU-wide negotiations over new C02 targets are “an entirely different issue to manufactures illegally falsifying emissions tests.” However fuel efficiency and emissions standards are increasingly being linked amid fierce criticism of the EU’s approach to automotive testing.”

    Yes indeed, the charges of Mr. Baker are “an entirely different issue to manufactures illegally falsifying emissions tests,” although highly thematically related:


    Mr Baker, who served as transport minister from 2010 to 2013, said that Ms Merkel had personally telephoned the Prime Minister and called in a favour to protect her country’s car industry. He said that Mr Cameron’s U-Turn over EU emissions regulation had provoked “fury” within Government and from UK car firms.

    “We had negotiated a good deal which both reduced overall emissions and had protections for niche British carmakers such as Aston Martin, but the Germans wanted super credits added back in, which are of no use to our manufactures but were very useful to BMW and Daimler, said Mr Baker.

    Super credits are a clause in EU rules for rewarding a large manufacturer with permission to make high-emitting gas guzzlers if it also manufactures a certain number of electric cars or low emissions vehicles. Campaigners say the system has allowed large car makers to continue to produce high CO2 emitting vehicle in exchange for producing a small number of lower emissions vehicles.

    “Super credits are a clause in EU rules for rewarding a large manufacturer with permission to make high-emitting gas guzzlers if it also manufactures a certain number of electric cars or low emissions vehicles. Campaigners say the system has allowed large car makers to continue to produce high CO2 emitting vehicle in exchange for producing a small number of lower emissions vehicles.

    And as researchers concluded in 2013, these “super credits” weren’t even required for European auto manufacturers to meet their emissions targets. It was just a waste.

    So we’ll see if David Cameron’s 2012 decision to demur to Merkel’s request for a favor to let German manufacturers sell more high-polluting vehicles ends up becoming part of the growing emissions scandal, but if so, it could have end engulfing more EU leaders that just David Cameron. That decision to delay those standards and allow for unnecessary “super credit” was an EU decision and involved a lot more leaders than just David Cameron. And was also reported on in 2013:

    EurActiv.com
    Diplomat: Germany ‘dictated’ delay to CO2 in cars deal
    by Arthur Neslen
    28 Jun 2013 – 08:49 updated: 28 Jun 2013 – 16:39

    German diktats to the Irish EU presidency are responsible for freezing a hard-fought deal to cap emissions from Europe’s cars by 2020, which was set to be rubber-stamped at the European summit, diplomatic sources say.

    Earlier this week, the proposal to limit passenger car emissions to 95 grams of CO2 per km (g/km) was hailed by the Irish environment minister Phil Hogan as “a win-win for climate, consumers, innovation and jobs.”

    But in scenes that campaigners called “unprecedented”, the vote was delayed indefinitely yesterday (27 June), and must now be addressed by Lithuania, which takes on the six-month rotating EU Council Presidency on 1 July.

    “The way it happened was highly unusual in that it was the result of high level contacts,” one diplomat told EurActiv. “The choice of the [Irish] presidency was dictated to them.”

    The source confirmed press reports that Chancellor Merkel called Ireland’s Taoiseach Enda Kenny over the issue the night before the summit of EU leaders, which opened in Brussels yesterday (27 June).

    “The presidency didn’t stand up to Germany’s requests,” the diplomatic source said. “The ‘right arguments’ were found to get this flexibility from the presidency and Ireland bowed to the pressure.”

    Luxury German car-makers such as Daimler and BMW have complained that the proposed targets unfairly singled them out. At 147 g/km on average, emissions from Germany’s car industry are 15g/km higher than the EU median, according to the International Council on Clean Transportation.

    Clean car campaigners say that Berlin is playing for time until Croatia’s accession to the EU on 1 July brings it closer to a blocking minority at the EU Council of Ministers, which represents the member states. But as yesterday’s vote was merely indicative, Zagreb would still have had a say in any final Council decision.

    Countries such as Poland and the UK are widely believed to have supported the German demand for postponing the vote. EurActiv understands that a few minutes before the delay was announced, France also adopted this position, following high-level – but not prime ministerial – German-Franco contacts.

    “They told France that they needed this delay, and promised to use it to explain the deal to their manufacturers and not to build a blocking minority,” an EU source said.

    Green scepticism

    Green campaigners though were sceptical of Germany’s motives, with Transport & Environment’s Greg Archer lambasting what he called “an attempt to overturn a fairly-negotiated agreement between the European Parliament, the Commission and the Council itself.”

    He went on: “It is ludicrous for Germany to claim it needs more time, as the 95g target was agreed five years ago and Germany has already put forward five different proposals that have been rejected by the vast majority of EU countries.”

    EU states last week rejected German efforts to allow ‘super-credits’ for low carbon cars to be banked for a further three years after 2020. In practice, environmentalists say this would simply have extended the deadline for compliance until 2023.

    That was the EU parliamentary roadblock in June of 2013 over the new standards and lack of “super credits”. But a compromise was eventually reach in November and, surprise, surprise, the backers of “super credits” were presumably super happy:

    Deutsche Welle
    Germany, EU reach compromise over vehicle carbon emissions

    Following months of delays by Germany, the European Union has reached an agreement on carbon emissions restrictions for new cars. Manufacturers will have more time to meet the rules.

    Date 29.11.2013

    Efforts to curb carbon dioxide emissions from Europe’s vehicles were revived on Friday following months of delays, as European Union diplomats announced they had unanimously reached an agreement for tough carbon dioxide emissions rules for new cars.

    Progress on the plans was stalled by Germany when it put the brakes on the measures in June.

    Berlin had expressed concerns that an EU plan to limit car exhaust emissions to 95 grams of carbon dioxide per kilometer (95g/km) for all new cars by 2020 would harm Germany’s dominant automobile industry. It pushed for manufacturers to be granted four more years to reach that limit.

    Germany’s Chancellor Angela Merkel, whose Christian Democrats party received money from carmaker BMW, came under pressure for taking up the cause of the large German auto manufacturers, saying that she was protecting German jobs.

    Carbon compromise

    Under the compromise deal, which is expected to be endorsed by the European Parliament in January, the 95g/km limit would apply from 2021, with 95 percent of new cars still needing to meet the limit by 2020.

    It also includes the introduction of so-called “supercredits” which would enable makers of gas-guzzling cars to remain within the EU targets if they also included hybrid or electric vehicles in their product ranges. This would benefit German luxury car makers like Daimler and BMW.

    Spokesman for the German government Georg Streiter said the deal provided “a more flexible arrangement with added innovation incentives.”

    ‘Better late than never’

    EU Climate Action Commissioner Connie Hedegaard took to social networking platform Twitter to show her support for the deal “Too much watering-down avoided,” she wrote. “Better late than never.”

    The German Association of the Automobile Industry (VDA) spoke of the “enormous effort” ahead but said the planned deal was a “step in the right direction”.

    However, the dilution of the original plans was criticized by environmental groups who fear that not enough is being done to curb carbon dioxide emissions, which are seen to contribute to climate change.

    Greenpeace accused the German automobile industry of “theatrical whining”.

    And, yes, following that compromise agreement, the “super credits” bill became law a few months later.

    So that all happened. Previously. And no one really cared. But now that the VW mega scandal has also happened maybe we’ll see some serious public attention on the fact the EU’s auto emissions laws were basically written by the German auto industry. It’s something the industry probably doesn’t want to publicly take credit for but that may not be an option at this point given the super job it’s done so far.

    Posted by Pterrafractyl | September 30, 2015, 12:44 pm
  13. VW’s US operations chief Michael Horn appears to have a pretty good idea of who is to blame for the emissions scandal: Two software engineers. And only two software engineers:

    International Business Times
    VW scandal: Michael Horn says company not behind cheat device and blames 2 software engineers

    By Rachel Middleton
    October 9, 2015 04:24 BST

    Volkswagen’s US operations chief Michael Horn came out strongly defending the company saying that it was not a corporate decision to install cheat software devices on 11 million diesel vehicles globally. He placed the blame solely on a couple of software engineers.

    Facing the House of Representatives Oversight and Investigations panel in the US Congress on Thursday (8 October), he however conceded, after tough questioning, that even he found it difficult to believe this.

    Initially, he told the panel: “This was a couple of software engineers who put this in for whatever reason. Some people have made the wrong decisions in order to get away with something that will have to be found out.”

    However, Chris Collins a representative from New York told Horn that he “categorically” rejected the idea that using the defeat devices was not a corporate decision and that software engineers were solely responsible. “Either your entire organisation is incompetent when it comes to trying to come up with intellectual property, and I don’t believe that for a second, or they are complicit at the highest levels in a massive cover-up that continues today.” And Horn’s reply to that was: “I agree it’s very hard to believe. Personally I struggle as well.”

    The German automaker has suspended 10 senior managers, including three top engineers, as part of its on-going internal investigation. Its then chief executive officer, Martin Winterkorn was also forced to resign when the scandal broke.

    Horn also told the panel that he felt personally deceived and that it was wrong for companies to put profits before people. He said he was unable to sleep at night after the company admitted that 11 million vehicles were fitted with a defeat device aimed at cheating emissions tests.

    “I have worked for 25 years for this company. Integrity, quality and not cheating was always for me a given for this company. I don’t sleep at night,” he said. He claimed that he had “no understanding” of what defeat devices were and only learned of them at a meeting in September that Volkswagen held with US and California air regulators.

    “This was a couple of software engineers who put this in for whatever reason. Some people have made the wrong decisions in order to get away with something that will have to be found out….I agree it’s very hard to believe. Personally I struggle as well.”

    So according to the guy claims to have had “no understanding” of what defeat devices were and only learned of them at a meeting in September that Volkswagen held with US and California air regulators, he’s pretty confident it was just a couple of software engineers. It’ll be interesting to see if the same two engineers get blamed for the second “defeat device” that regulators have just stumbled across, or if that will be blamed on a different pair of engineers. And only those engineers:

    CBC News
    U.S. regulators probe whether Volkswagens have 2nd cheat device
    U.S. CEO Michael Horn admits VW withdrew 2016 diesel vehicles from regulatory process over software

    Posted: Oct 09, 2015 11:25 AM ET Last Updated: Oct 09, 2015 5:21 PM ET

    U.S. and California regulators are investigating whether a second device designed to foil emissions regulations has been installed in some Volkswagen models, according to the New York Times.

    A spokesman for the California Air Resources Board admitted to the newspaper that it is looking into Volkswagen’s certification documents and the impact of a second device. The Environmental Protection Agency is also investigating.

    The auxiliary emissions control device would be in addition to the engine software exposed last month that switched on emissions controls during testing conditions but turned them off during real-world driving.

    The California regulator has given Volkswagen until Nov. 20 to come up with a fix for its diesel engines that spew too much nitrogen oxide.

    On Thursday, the CEO of VW’s U.S. operations Michael Horn presented background documents to Congress that showed Volkswagen had withdrawn its 2016 diesel cars from environmental certification over a software device.

    The International Council on Clean Transportation, the research group that first exposed Volkswagen’s emissions cheating, has noted the presence of an auxiliary emissions control device on 2016 models.

    Automakers are allowed to use such devices to allow higher emissions when a vehicle is going uphill or in very cold weather if they are approved by regulators.

    But Horn testified Thursday before a House energy and commerce subcommittee that the company had neglected to disclose the software and seek approval from regulators.

    Hidden software that should be allowed, but must be disclosed and yet wasn’t. That is a bit suspicious all things considered:


    The International Council on Clean Transportation, the research group that first exposed Volkswagen’s emissions cheating, has noted the presence of an auxiliary emissions control device on 2016 models.

    Automakers are allowed to use such devices to allow higher emissions when a vehicle is going uphill or in very cold weather if they are approved by regulators.

    But Horn testified Thursday before a House energy and commerce subcommittee that the company had neglected to disclose the software and seek approval from regulators.

    “But Horn testified Thursday before a House energy and commerce subcommittee that the company had neglected to disclose the software and seek approval from regulators.”
    This pesky software engineers. Clearly they were solely responsible for this (and not the guy running the US operations that apparently didn’t know what a “defeat device” was until last month).

    Posted by Pterrafractyl | October 9, 2015, 2:47 pm
  14. Here’s another “uh oh” report for VW’s management: It turns out using “defeat device” software to cheat emissions tests in a broad range of vehicles over a number of years (with changing technology) in different countries with different emissions guidelines might require the development of multiple versions of the “defeat device” software for all of those different circumstance and updating it when new engine technology is rolled out. And doing all that since 2008 wouldn’t be very easy to do without management’s approval:

    Sat Oct 17, 2015 2:10pm EDT
    VW made several defeat devices to cheat emissions tests: sources

    BERLIN/LOS ANGELES/DETROIT | By Andreas Cremer, Bruce Wallace and Paul Lienert

    Volkswagen made several versions of its “defeat device” software to rig diesel emissions tests, three people familiar with the matter told Reuters, potentially suggesting a complex deception by the German carmaker.

    During seven years of self-confessed cheating, Volkswagen altered its illegal software for four engine types, said the sources, who include a VW manager with knowledge of the matter and a U.S. official close to an investigation into the company.

    Spokespersons for VW in Europe and the United States declined to comment on whether it developed multiple defeat devices, citing ongoing investigations by the company and authorities in both regions.

    Asked about the number of people who might have known about the cheating, a spokesman at company headquarters in Wolfsburg, Germany, said: “We are working intensely to investigate who knew what and when, but it’s far too early to tell.”

    Some industry experts and analysts said several versions of the defeat device raised the possibility that a range of employees were involved. Software technicians would have needed regular funding and knowledge of engine programs, they said.

    The number of people involved is a key issue for investors because it could affect the size of potential fines and the extent of management change at the company, said Arndt Ellinghorst, an analyst at banking advisory firm Evercore ISI.

    Brandon Garrett, a corporate crime expert at the University of Virginia School of Law, said federal prosecution guidelines would call for the U.S. Justice Department to seek tougher penalties if numerous senior executives were found to have been involved in the cheating.

    “The more higher-ups that are involved, the more the company is considered blameworthy and deserving of more serious punishment,” said Garrett.

    VW, Europe’s biggest carmaker, has been criticized by some lawmakers and analysts for blaming a small number of individuals for the banned software installed in up to 11 million vehicles worldwide, even while investigations continue.

    Its U.S. chief, Michael Horn, told U.S. lawmakers earlier this month that he believed “a couple of software engineers” were responsible, while a letter dated Oct. 8 from VW to the European Parliament blamed “the misconduct of a few people.”

    MANY CHANGES

    When it started using defeat device software in 2008, VW installed it with the EA189 diesel engine. The software was subsequently added to the newer EA288 engine.

    “VW would have had to reconfigure the software for each generation of engines,” said the U.S. official close to an ongoing investigation into VW.

    A U.S.-based expert on diesel engines and testing said the defeat device software also had to be altered when VW changed the emissions control system in its engines.

    In older diesel models, VW used so-called Lean NOx Traps designed to reduce toxic nitrogen oxides in engine exhaust. From around 2012, it introduced a more sophisticated and expensive system called Selective Catalytic Reduction.

    VW’s Horn told U.S. lawmakers on Oct. 8 that different software was developed for Europe as well.

    “Since the standards are different, my understanding is that the defeat devices in those (European) cars are as well,” he said, without elaborating.

    Horn added VW was withdrawing its application for regulatory certification of 2016 diesel models because it contained another software feature that had not been disclosed as required by the authorities.

    “Horn added VW was withdrawing its application for regulatory certification of 2016 diesel models because it contained another software feature that had not been disclosed as required by the authorities.”
    Wow, those rogue VW coders that management totally knew nothing about sure were busy! *wink*

    Posted by Pterrafractyl | October 19, 2015, 12:40 pm
  15. I kind of assumed VW is an asset/extension of the German Government and Underground Reich. Why did they get caught? Aren’t we used to these folks getting away with bloody murder?

    Posted by GK | October 20, 2015, 3:52 pm
  16. A file with documents containing a Lower Saxony official’s correspondences in connection with the VW emissions scandal disappeared recently and authorities are now looking into the matter. We’re being assured that the file contained no secret VW and it’s being depicted as mostly just frustrating but not serious. But considering that Lower Saxony holds about 20% of VW’s voting stock, with special voting rights, and considering that the file is also said to contain the official’s internal comments on legal questions, it seems like this could be described as more than just frustrating:

    The Wall Street Journal

    German Authorities Investigating Missing VW Emissions Scandal File
    Unclear what documents were in the file and if they constitute evidence

    By William Boston and
    Hendrik Varnholt
    Updated Oct. 21, 2015 12:14 p.m. ET

    German authorities are investigating the possible theft of documents related to the Volkswagen AG emissions scandal from a state government office, officials said Wednesday.

    The missing documents belonged to a department chief in the Lower Saxony state government’s office, according to a statement by the state government.

    It is unclear which documents were in the file and whether they constitute evidence in a probe into Volkswagen’s emissions cheating scandal.

    The state said the documents were the official’s correspondence in connection with the case and contained no secret Volkswagen documents.

    “There were exclusively print outs and copies of documents in the personal file, most of which are available on the Internet, as well as internal comments on legal questions,” the state government’s office said in a statement. The file contained “no supervisory board files” and so “the loss of this personal file is frustrating, but not a very serious problem,” the statement said.

    Volkswagen last month admitted to having installed devices in diesel engines of up to 11 million cars that could help the vehicles meet tight emissions tests while polluting more heavily in actual use.

    Lower Saxony, where Volkswagen is based, is a core shareholder in the company. It holds about 20% of Volkswagen’s voting stock and special rights to prevent it from being outvoted. The state holds two seats on Volkswagen’s supervisory board and is represented on the board by state Prime Minister Stephan Weil and Economy Minister Olaf Lies.

    The department chief last saw the file on Friday, Oct. 9, and reported it missing the following Monday, Oct. 12, according to the statement. Four days later, on Oct. 16, the state government filed a complaint with the Lower Saxony State Criminal Office, requesting an investigation into a potential theft of state documents by an unknown person or persons.

    “We have taken up the investigation,” said Frank Federau, a spokesman for the Lower Saxony investigators, declining to comment further.

    A spokeswoman for the prosecutor’s office in Hannover, the capital of Lower Saxony, said no one had yet been charged in the case and declined to comment on the investigation.

    “So far, we have no concrete suspects,” said Kathrin Söfker, a Hannover state prosecutor.

    Well, we’ll see if the documents ever turn up although it seems like they may have made a trip to the paper shredder by now.

    In tangentially related news, if you’ve recently stolen a bunch of confidential documents about an emissions fraud scandal, ran them through a paper shredder, but then accidentally dumped all those shreds on the floor and need to vacuum them up, your new energy-efficient vacuum cleaner might have a bit of a ‘VW’ problem:

    The Telegraph
    James Dyson accuses Bosch of cheating ‘like Volkswagen’
    The Dyson boss has filed legal proceedings against its German rival

    By Rebecca Burn-Callander, Enterprise Editor

    12:01AM BST 21 Oct 2015

    Sir James Dyson has claimed Bosch are the Volkswagen of the vacuum cleaner world as he launched legal action against his German engineering rival.

    The inventor of the bagless vacuum cleaner alleged that Bosch is duping consumers with misleading energy-efficiency ratings for its machines.

    “Bosch has installed control electronics into some of its machines to wrongfully increase energy consumption when in use – to cheat the EU energy label,” Sir James said. “Their behaviour is akin to that seen in the Volkswagen scandal.

    “It seems that industry is rife with manufacturers engineering to find their way around tests, rather than engineering better, more efficient technology. This behaviour is seriously misleading customers.”

    Sir James has alleged that the AAAA energy rating achieved by some of Bosch’s vacuum cleaner models was achieved during lab tests with a clean bag in use. But sensors within the vacuum cleaner tell the motor to increase energy use from 750W to 1,600W when the bag is full of dirt to maintain performance, which reduces the energy rating to an E or F.

    These findings came to light during independent laboratory testing, according to Sir James.

    It may be, however, that the EU test methodology is flawed rather than there being wrongful action by Bosch. There is a longstanding rivalry between the two manufacturers. In 2012, Sir James sued Bosch for allegedly paying a Dyson employee to steal secrets from the company’s Malmesbury base.

    Bosch has denied that its appliances perform differently at home and under lab conditions, saying that “any suggestion to the contrary is grossly misleading”.

    “We do not understand these assertions by Dyson and we strenuously reject them,” the company said, adding that it was “committed to full disclosure on the energy ratings and broader performance of our vacuum cleaners”.

    “Bosch has capitalised on the EU regulations which permit that a machine is only tested in an empty state,” Dyson, the company, said in a statement. “Consumers purchasing these machines on the basis of their widely advertised stated AAAA rating are being misled.”

    Dyson has taken legal action over the Bosch machines – issuing proceedings in Germany, Belgium and the Netherlands. If Dyson’s legal challenge is successful, certain models of Bosch vacuum cleaner may need to be recalled.

    Sir James has previously stated that the new EU Energy Label regulations launched in 2013, which produce the energy ratings, are fundamentally flawed.

    His company is currently challenging the regulatory process through a judicial review, demanding that machines are tested under “real world conditions”. That ruling is expected by the end of the year.

    Last month Sir James said that the world of regulation was “murky” and provided “a smokescreen for manufacturers to hide behind”.

    “[There are] fridges tested with no food, vacuum cleaners tested with no dust, and washing machines tested at inaccurate temperatures,” he claimed. “The regulators clearly live in a place that looks nothing like the real world and manufacturers are taking advantage.”

    Bosch supplied the engine control systems that VW used to install “defeat devices”, which embroiled the car maker in the diesels emissions-rigging scandal.

    “Bosch supplied the engine control systems that VW used to install “defeat devices”, which embroiled the car maker in the diesels emissions-rigging scandal.”

    Posted by Pterrafractyl | October 21, 2015, 2:48 pm
  17. This should be interesting: VW just warned that its emissions scandal, which had been limited to vehicles using the EA 189 engine, might include its newer EA 288 engine too:

    The New York Times
    Volkswagen Investigating if Diesel Emissions Deception Was More Extensive

    By JACK EWING
    OCT. 22, 2015

    FRANKFURT — Volkswagen said on Thursday that it was investigating whether substantially more vehicles than previously disclosed were equipped with software intended to deceive emissions tests, raising the possibility of even greater damage to the company’s reputation and finances.

    The automaker admitted last month that 11 million cars and light commercial vehicles equipped with a diesel motor line known as the EA 189 had the illegal software. On Thursday, Volkswagen said it was investigating whether some versions of another diesel motor line, known as the EA 288, also had software intended to detect when a vehicle was undergoing emissions testing and turn on pollution controls.

    Under normal road use, the EA 189 vehicles, which included popular models like the Passat, Jetta, Beetle and Golf, could emit up to 40 times the allowed amount of nitrogen oxide, a pollutant linked to numerous lung ailments.

    A Volkswagen spokesman would not comment on how many more cars might be affected. Since 2012, the EA 288 has been installed in vehicles like the best-selling Golf, suggesting that the number of additional cars could be in the millions. The EA 288 was also installed in cars sold in the United States.

    A company spokesman said that the newest versions of the motor, which are certified according to the latest European diesel emissions standard, are compliant with emissions rules and do not have illegal software.

    Under pressure from German authorities, Volkswagen is recalling about 8.5 million European vehicles with the EA 189 motor to bring them into compliance with emissions regulations. Volkswagen has also promised to fix about 500,000 diesel cars in the United States.

    Matthias Müller, the Volkswagen chief executive, said this month that the cost of repairing the vehicles would far exceed the 6.5 billion euros, or about $7.4 billion, the company initially allocated for recalls. If many more vehicles are affected, the expense to Volkswagen could rise significantly.

    Not only would Volkswagen have to repair more cars, but it would also face more lawsuits from customers whose vehicles have lost value, or who contend that they were sold cars under false premises. Volkswagen marketed its “clean diesel” vehicles as an environmentally responsible choice for buyers who also wanted peppier performance than they would get from a hybrid competitor, like the Toyota Prius.

    On Wednesday, Volkswagen said it had halted the sale of what it called a limited number of new cars with EA 189 motors from 2015 or earlier that were already at dealerships but had not been sold.

    A 2-liter, four-cylinder version of the EA 288 was installed in Golf, Jetta and Passat cars sold in the United States beginning in 2012, according to an article on the website of Car and Driver magazine. The motor was more powerful than the EA 189, the magazine said, and treated emissions partly by recycling some exhaust gases into the motor. In addition, like the EA 189, the motor had a system to inject the chemical urea into the exhaust, which if designed properly could neutralize most of the nitrogen oxide emissions.

    In treating some emissions by recycling them, the engine would have placed less of a burden on the chemical system, and owners would not have had to refill a urea supply tank as often. But the recycling system can also hurt acceleration and fuel economy. Volkswagen could have been motivated to dial back the pollution controls, except during testing, to give drivers better fuel consumption and performance, engineers outside the company have said.

    In Internet forums, Volkswagen drivers often reported better fuel performance than in official government ratings.

    EA stands for “entwicklungsauftrag,” or “development order,” and signified a major new engine line. Volkswagen deploys its engines and other components not only in Volkswagen cars, but also in other brands belonging to the company, like Audi or Skoda. The strategy saves money because costs of development and production are spread across a large number of vehicles. But it means that any problems infect a large number of vehicles.

    Volkswagen has suspended five high-ranking executives in connection with the scandal. Mr. Müller has said that a small number of employees were responsible for the illegal software.

    Determining how many people were in the know is one of the main goals of an internal investigation being conducted by Jones Day, an American law firm with offices in Germany. The investigation is still in its early phases and it is not clear how many managers, engineers and others may eventually be implicated, but the number is expected to rise.

    At the very least, employees with knowledge of software coding would have to have been involved in order to program the motors to cheat.

    So that was the earlier report. But now we’re hearing that VW has completed its investigations and found no problems with the EA 288:

    Bloomberg Business
    Volkswagen Says Recall Will Be Limited to Older Diesel Engines
    Christoph Rauwald

    October 22, 2015 — 10:33 AM CDT

    Volkswagen AG said its current-generation diesel engine doesn’t have software designed to cheat on emissions tests, meaning its global recall of as many as 11 million cars won’t need to be even bigger.

    Diesel cars with EA 288 motors meet legal and environmental requirements, the Wolfsburg, Germany-based company said Thursday in an e-mailed statement. The EA 288 replaced the EA 189 class of engines implicated in the emissions scandal.

    Volkswagen had said earlier Thursday that it was examining whether other diesel engines have software that cheated emissions tests by turning on full pollution filters only when cars were being tested. The company is recalling 8.5 million vehicles in Europe alone, potentially one of the most complex and costly fixes in automotive history.

    “After a thorough review it is now clear” that the offending software isn’t installed in vehicles with EA 288 motors built under previous Euro-5 standards, Volkswagen said. The carmaker has consistently said its latest, Euro-6 diesel engine complies with European regulations.

    Well, that’s good news. For pretty much everyone. But it does raise an interesting question: since the EA 288 engines were supposed to replace the EA 189 engines but don’t have the malicious software installed, why haven’t there been earlier reports of significant performance difference between the EA 189 and EA 288 vehicles? Was the EA 288 such a big improvement over the EA 189 that it really was the low-pollution/high mileage engine VW claimed it was selling? If not, what’s the explanation?

    Posted by Pterrafractyl | October 22, 2015, 9:40 am
  18. The VW emissions scandal just had a new twist. The EPA announced that it has discovered emissions-cheating software on more diesel cars. This time it includes vehicles from VW, Audi, and Porche with 3.0 liter engines. The report describes in detail the mechanisms of how the software does its cheating. And here’s the twist: VW denies it:

    The New York Times
    E.P.A. Finds More VW Cheating Software, Including in a Porsche

    By JAD MOUAWAD
    NOV. 2, 2015

    The Environmental Protection Agency said on Monday that it had discovered emissions-cheating software on more Volkswagen and Audi cars than previously disclosed and, for the first time, also found the illegal software in one of the carmaker’s high-end Porsche models.

    The German carmaker disputed the claims, however, saying it had not installed defeat software on the models in question that would “alter emissions characteristics in a forbidden manner.” The company pledged in a short statement that it would cooperate with the E.P.A. “to clarify the matter in its entirety.”

    The new revelations escalate the potential damage to Volkswagen’s finances and reputation. Audi and Porsche are the source of most of the company’s earnings, because profit margins tend to be higher on luxury cars. In contrast to Volkswagen brand cars, which have struggled in the United States, Audi and Porsche are success stories in North America, which is the biggest market for Porsche.

    The E.P.A.’s report opens a new chapter in its investigation of Volkswagen’s deceitful practice. The new devices were uncovered after investigators said on Sept. 25 that they would test all diesel car models, a week after disclosing Volkswagen’s fraud. The tests were performed by E.P.A., the California Air Resources Board and the regulatory group Environment Canada.

    “VW has once again failed its obligation to comply with the law that protects clean air for all Americans,” Cynthia Giles, the assistant administrator for E.P.A.’s Office of Enforcement and Compliance Assurance, said in a statement.

    Regulators have not found similar defeat devices on diesel models produced by other automakers. Testing is continuing, and the agency plans to make its final results public.

    Hours after the E.P.A. made its latest accusations, Volkswagen disputed the findings. “Volkswagen AG wishes to emphasize that no software has been installed in the 3-liter V6 diesel power units to alter emissions characteristics in a forbidden manner,” Volkswagen’s statement read.

    But in a six-page letter explaining its findings, the E.P.A. described in detail a mechanism it says was set up to intentionally beat emissions testing. It said the devices were not described in the vehicles’ certification application and were set up to defeat a federal emission test procedure known as FTP 75.

    The agency said the new tests found that Volkswagen had installed the devices in some Volkswagen, Audi and Porsche diesel cars with 3.0-liter engines, encompassing model years 2014 through 2016.

    The notice described how once the vehicle’s electronic brain detected the cars were being tested, it would direct the car to operate emission control parameters — including injection timing, exhaust gas recirculation rate and fuel pressure — to reduce nitrogen oxide emissions. Once back in normal driving conditions, the car would increase the release of nitrogen oxide up to nine times the agency’s standard.

    Asked about Volkswagen’s statement challenging the E.P.A.’s claims, a spokeswoman for the agency reiterated that the undisclosed existence and use of devices meant to circumvent emission controls was illegal under the Clean Air Act.

    The latest finding covers about 10,000 passenger cars already sold in the United States since the model year 2014. The violation notice also covers an unspecified number of 2016 vehicles. The cars found to have the software installed are the diesel versions of the 2014 VW Touareg, the 2015 Porsche Cayenne and the 2016 Audi A6 Quattro, A7 Quattro, A8, A8L and Q5.

    In a separate notice from California’s Air Resources Board, which also has broad authority to regulate emissions, regulators there backed the findings from the E.P.A. “ARB is very disappointed with this development as VW (along with all the other manufacturers) was alerted on September 25, 2015, that A.R.B. would be immediately conducting defeat device testing,” the California regulator said in its notice to Volkswagen.

    Until now, investigators in the United States and Europe had focused on 2.0-liter engines and smaller models. Volkswagen has admitted that more than 11 million cars were equipped with this fraudulent software, including 482,000 in the United States.

    The latest development has left many observers stunned. Congressional investigators indicated they would continue pressuring VW for answers.

    “The latest revelations raise the question, where does VW’s road of deceit end?” senior leaders of the House Energy and Commerce Committee said in a joint statement. “It’s time for Volkswagen to fully come clean.”

    Note the parsing in VW’s denials: “Volkswagen AG wishes to emphasize that no software has been installed in the 3-liter V6 diesel power units to alter emissions characteristics in a forbidden manner.”

    It raises the question: Will VW attempt to argue that these “defeat devices” do exist, but were actually legal? If so, keep in mind that it won’t be an argument without numerous precedents.

    Posted by Pterrafractyl | November 2, 2015, 8:35 pm
  19. Ouch. VW just issued a new “oopsie” report about another 800,000 cars that may have emissions “inconsistencies” for CO2. And this time it includes a non-diesel engine too:

    Reuters
    VW sees 800,000 more cars affected by ‘inconsistencies’

    BERLIN/FRANKFURT | By Andreas Cremer and Georgina Prodhan
    Tue Nov 3, 2015 2:56pm EST

    Volkswagen (VOWG_p.DE) said on Tuesday it found data “inconsistencies” on carbon dioxide emissions for 800,000 more cars, the latest sign of trouble for Europe’s biggest automaker, already reeling from an emissions scandal.

    Volkswagen said it faces about 2 billion euros ($2.19 billion) in economic risks from the newly disclosed issue, which mostly affects small diesel engines and one gasoline one. They are unrelated to U.S. regulators’ allegations on Monday that larger diesel engines mostly used in Porsche and Audi sports utility vehicles were designed to cheat emissions tests.

    The carmaker said it would immediately start talking to “responsible authorities” about what to do about the latest findings.

    “From the very start I have pushed hard for the relentless and comprehensive clarification of events,” Volkswagen Chief Executive Matthias Mueller said in a statement. “We will stop at nothing and nobody. This is a painful process but it is our only alternative.”

    Europe’s largest carmaker had previously admitted to installing cheat software on up to 11 million vehicles worldwide with 2.0 liter diesel engines. But the latest allegations from U.S. regulators and the automaker itself suggest that both larger and smaller motors and even non-diesel ones may have deceived regulators.

    “VW is leaving us all speechless,” said Arndt Ellinghorst of banking advisory firm Evercore ISI after the disclosure about the smaller engines. “It seems to us that this is another issue triggered by VW’s internal investigation and potentially related to Europe.”

    VW has so far denied allegations regarding the larger 3.0 liter diesel engines made by the U.S. Environmental Protection Authority (EPA), saying no software had been installed to “alter emissions’ characteristics in a forbidden manner” on the larger engines. It did not immediately respond to questions on Tuesday, saying it would only correspond in writing.

    The biggest business crisis in VW’s 78-year history has wiped as much as a third off its stock market value, forced out long-time CEO Martin Winterkorn and rocked the auto industry – a key employer and source of export income in Germany.

    “Volkswagen has done a disservice to German industry,” Ulrich Grillo, the head of the Federation of German industries, told a conference on Tuesday, adding the firm had an obligation to the whole industry to clear up the scandal quickly.
    Related Coverage

    German Chancellor Angela Merkel and the European Commission, the European Union’s executive body, called for clarity and transparency to clean up the scandal.

    VW’s supervisory board will hold a special meeting Monday to discuss the financial implications of the scandal, two sources with knowledge of the matter told Reuters.

    The company took a 6.7 billion euro hit in third-quarter results to cover initial costs related to the scandal. Some analysts have said the final bill could reach as much as 35 billion euros in regulatory fines, lawsuits and vehicle refits.

    VW shares fell 1.5 percent to close at 111 euros. The VW statement about the additional 800,000 cars with emissions issues came out after the Frankfurt market had closed.

    Audi said on Tuesday it had not installed defeat devices in its 3 liter V6 diesel engines and is aiming to meet with California regulators in the next week to explain its position as well as how the software works. Seeking belated authorization of the software could be one option to try to solve the matter, the spokesman said.

    “It would cause the biggest possible shock to VW if those accusations are true,” said Stefan Bratzel, head of the Center of Automotive Management think-tank near Cologne.

    “VW keeps touting utmost transparency but they really should have put all the cards on the table. There is a lot of need for explanation, from Audi too.”

    Rival German carmaker BMW (BMWG.DE) reiterated on Tuesday it had not manipulated emissions tests, as it posted a surprise rise in third-quarter operating profit.

    Keep in mind that, should the VW scandal expand beyond diesel engine emissions cheating and start including CO2 emission “inconsistencies” involving gas engine, this could expand the scandal to include not just VW’s entire passenger vehicle fleet but pretty much the entire global auto industry since emissions cheating of one degree or another is so ubiquitous. So in terms of “framing” this scandal, expanding it beyond diesel emissions to include the inaccuracies in CO2 emissions from all cars might actually be a stroke of PR genius because it won’t just be VW everyone is talking about. And helpful too, so let’s hope VW starts pointing fingers elsewhere and goes into “there’s a pox on your house too!”-mode. That could be fun.

    But let’s also hope that VW is less successful in the other strategy that Audi appears to be mulling over: retroactively legalizing these “defeat devices”:


    Audi said on Tuesday it had not installed defeat devices in its 3 liter V6 diesel engines and is aiming to meet with California regulators in the next week to explain its position as well as how the software works. Seeking belated authorization of the software could be one option to try to solve the matter, the spokesman said.

    “Seeking belated authorization of the software could be one option to try to solve the matter, the spokesman said.”
    Just legalized the “defeat devices”! Well, that’s one option. It’s not the best option, but it’s apparently an option.

    Posted by Pterrafractyl | November 3, 2015, 3:44 pm
  20. VW issued an update on the mystery of the new “defeat devices” discovered in its 3.0 liter diesel engine that VW previously claimed were not illegal. And it turns out VW may have been partially correct. VW now admits that there were indeed “defeat device” installed that it didn’t tell US regulator about them, but the devices aren’t actually illegal. In Europe:

    The Associated Press
    Volkswagen’s Emissions Scandal Is Getting Even Bigger
    More Volkswagen, Audi and Porsche owners could face recalls of their cars.
    AP
    By Tom Krisher and Michael Biesecker
    Posted: 11/20/2015 05:37 PM EST

    WASHINGTON (AP) — Volkswagen’s emissions cheating scandal widened Friday after the U.S. Environmental Protection Agency said the German automaker used software to cheat on pollution tests on more six-cylinder diesel vehicles than originally thought.

    Volkswagen told the EPA and the California Air Resources Board the software is on about 85,000 Volkswagen, Audi and Porsche vehicles with 3-liter engines going back to the 2009 model year. Earlier this month the regulators accused VW of installing the so-called “defeat device” software on about 10,000 cars from the 2014 through 2016 model years, in violation of the Clean Air Act.

    The regulators said in a statement they will investigate and take appropriate action on the software, which they claim allowed the six-cylinder diesels to emit fewer pollutants during tests than in real-world driving.

    The latest allegation means that more Volkswagen, Audi and Porsche owners could face recalls of their cars to fix the software, and VW could face steeper fines and more intense scrutiny from U.S. regulators and lawmakers.

    Audi spokesman Brad Stertz on Friday conceded that VW never told regulators about the software, in violation of U.S. law. He said the company agreed with the agencies to reprogram it “so that the regulators see it, understand it and approve it and feel comfortable with the way it’s performing.”

    The software is on Audi Q7 and Volkswagen Touareg SUVs from the 2009 through 2016 model years, as well as the Porsche Cayenne from 2013 to 2016. Also covered are Audi A6, A7, A8, and Q5s from the 2014 to 2016 model years, according to the EPA.

    Stertz said the software is legal in Europe and it’s not the same as a device that enabled four-cylinder VW diesel engines to deliberately cheat on emissions tests. VW has told dealers not to sell any of the models until the software is fixed.

    VW made the disclosure on a day it was meeting with the agencies about how it plans to fix 482,000 four-cylinder diesel cars equipped with emissions-cheating software.

    U.S. regulators continue to tell owners of all the affected cars they are safe to drive, even as they emit nitrogen oxide, a contributor to smog and respiratory problems, in amounts that exceed EPA standards — up to nine times above accepted levels in the six-cylinder engines and up to 40 times in the four-cylinders.

    Well, that will indeed be helpful if the “defeat device” is reprogrammed so US regulators can “see it, understand it and approve it and feel comfortable with the way it’s performing”:


    Audi spokesman Brad Stertz on Friday conceded that VW never told regulators about the software, in violation of U.S. law. He said the company agreed with the agencies to reprogram it “so that the regulators see it, understand it and approve it and feel comfortable with the way it’s performing.”

    The software is on Audi Q7 and Volkswagen Touareg SUVs from the 2009 through 2016 model years, as well as the Porsche Cayenne from 2013 to 2016. Also covered are Audi A6, A7, A8, and Q5s from the 2014 to 2016 model years, according to the EPA.

    Stertz said the software is legal in Europe and it’s not the same as a device that enabled four-cylinder VW diesel engines to deliberately cheat on emissions tests. VW has told dealers not to sell any of the models until the software is fixed.

    And note that while the claims that “defeat devices” weren’t actually illegal in Europe aren’t as absurd as they sound. Yes, the idea that “defeat devices” would be legal is pretty damn absurd. But the statement that they might be legal
    unfortunately isn’t so absurd:

    The New York Times
    VW’s Emissions-Test Trickery May Not Be Illegal in Europe

    By DANNY HAKIM and CLAIRE BARTHELEMY

    NOV. 11, 2015

    LONDON — Four years ago, European auto regulators identified and debated a loophole in their pollution testing rules that could render vehicle emissions tests ineffectual, but it was ultimately left in place, internal documents show.

    The loophole lets carmakers change the performance settings of their engines before a pollution test. “A manufacturer could specify a special setting that is not normally used for everyday driving,” British regulators warned, according to minutes of a 2011 meeting in Geneva of officials across the region.

    The debate throws new light on Volkswagen’s costly emissions cheating — particularly the question of whether VW violated European testing rules.

    In September, Volkswagen admitted to installing “defeat device” software in 11 million cars, programming them to detect when they were being tested for nitrogen oxide emissions. The result was a substantial reduction in emissions. Volkswagen made the admission, after deceiving regulators in the United States for several months, in the face of an inquiry.

    But the same practice may be legal in Europe. While defeat devices are ostensibly banned in Europe as well as the United States, Paul Willis, a top Volkswagen official in Europe, said in a letter published this week that the company was still considering “whether the software in question officially constituted a defeat device” under European Union regulations.

    And Lucia Caudet, a spokeswoman for the European Commission, the European Union’s executive branch, said in an email that the commission had “no formal view on whether” the vehicles sold in the United States were “equipped with a ‘defeat device’ in the E.U. legal sense or not.” She added that investigations of vehicles sold in Europe “are still ongoing, so we cannot provide an assessment on the nature of the devices used at this stage.”

    The Volkswagen scandal has put Europe’s permissive testing practices in the spotlight, and has raised questions about the compatibility of American and European auto regulations. Trans-Atlantic trade talks are underway, and the objectives include fostering mutual recognition of auto regulations.

    Regulations that apply in Europe say “the settings of the engine and of the vehicle’s controls shall be those prescribed by the manufacturer.”

    If manufacturers have the discretion to determine their own engine settings during emissions tests in Europe, it remains unclear if using software to alter engine settings would violate European rules.

    Most of the roughly 11 million vehicles that Volkswagen has said carry the software are in Europe. About 500,000 vehicles are in the United States, and others are scattered across the globe.

    Billions of dollars could hinge on whether the company’s emissions software was technically a defeat device in Europe. Penalties for use of the devices are left to member states, though enforcement by auto regulators in Europe is rare.

    The answer could also weigh on litigation. David Standard, a spokesman for Leigh Day, a product liability law firm based in London, said the firm had taken in more than 8,000 potential Volkswagen-related claims and VW “could be looking at the largest-ever consumer legal action in U.K. history.”

    Volkswagen has committed itself to fixing the vehicles. In Britain, one of the company’s largest markets, VW says it will fix all of the affected vehicles by the end of 2016. Some may require modifications beyond rewriting software code.

    Many regulators and public officials in Europe were hesitant to discuss how the system worked in Europe, and offered conflicting accounts of what happened after the British proposed to tighten the engine-settings regulations in 2011.

    Different engine configurations can produce substantially different tailpipe emissions. A “sports” setting can emphasize more power and less fuel and pollution efficiency. An “eco” setting can do the opposite. Or a car can default to an in-between setting for everyday driving.

    The Volkswagen investigation continues to reveal divergences in American and European regulations.

    Last week, the Environmental Protection Agency, with regulators in California and Canada, said they had discovered that Volkswagen had used another defeat device in some larger cars and sport utility vehicles that had not previously been implicated.

    Volkswagen, whose brands include Audi, Porsche and Lamborghini, has disputed that it intentionally sought to evade United States regulations in the latest finding. Mr. Willis, Volkswagen’s top official in Britain, wrote in a letter to the British Parliament that German regulators had concluded that the software used in these larger vehicles did not constitute a violation in Europe.

    In an email, Germany’s Federal Motor Transport Authority, known by its German initials K.B.A., said that for the larger vehicles implicated by the E.P.A. last week, “the findings that are available so far, and which are not complete yet, show no indication that an illegal defeat device is used.”

    The European system is known for its loopholes — for instance, allowing automakers to test preproduction vehicles that will never be sold and letting them strip out the back seats to make cars lighter and tape the doors and grilles to make them more aerodynamic.

    But allowing manufacturers to determine engine settings is more fundamental to testing for pollution emissions.

    As the scandal unfolds, trade negotiators on both sides of the Atlantic have continued to work on the Transatlantic Trade and Investment Partnership, a sprawling trade agreement. Auto regulations have been considered a particularly fruitful target where the sides could agree to synchronize their rules. As the European Commission put it in a fact sheet early this year, there were no areas of controversy to hinder the discussions. “We’re not currently aware of any issues which are especially sensitive or where people have raised specific concerns,” the commission wrote.

    The Volkswagen scandal has made clear how fundamentally different the systems are, at least as related to emissions rules.

    Car regulation in Europe lacks central oversight. Automakers are permitted to have their vehicle fleets’ emissions certified by regulators in any of the 28 member states, and then they must be recognized by all the others. Policy makers in Brussels are also undercut by powerful member states like Germany protecting domestic automakers, critics say.

    While Europe plans to begin road testing of car pollution in 2017, those tests as now designed will have many of the same pitfalls as the lab tests. Among other things, manufacturers and their contractors will perform the tests with little regulatory oversight.

    The road tests are still subject to approval in the European Parliament, where frustration has been building. Volkswagen’s recent admission that it understated carbon dioxide emissions and overstated the fuel economy of 800,000 vehicles sold in Europe has added to that frustration.

    “What we have developed is a phony system of testing where the member states are in competition with each other for who can make it the most easy for the car manufacturers to pass the test,” said Gerben-Jan Gerbrandy, a Dutch member of the European Parliament, who lamented that European governments do not conduct random testing of their own, as the E.P.A. does.

    Mr. Gerbrandy is a member of the Alliance of Liberals and Democrats for Europe, a centrist bloc that assailed a recent move by the European government to make its forthcoming road emission tests easier to pass.

    “What we have developed is a phony system of testing where the member states are in competition with each other for who can make it the most easy for the car manufacturers to pass the test”
    Yes, one of the longest-running automotive races of our times was the secret regulatory Great Race to the bottom. It’s a gas.

    Posted by Pterrafractyl | November 23, 2015, 4:15 pm
  21. When scandal hits an organization, sometimes the subsequent investigation is exactly what is needed to dig that organization out of the hole they’ve created for themselves. Of course, if that digging continues to reveal a deeper scandal than previously recognized, sometimes the hole gets deeper too:

    The New Yorks
    VW Says Emissions Cheating Was Not a One-Time Error

    By JACK EWING
    DEC. 10, 2015

    WOLFSBURG, Germany — Volkswagen said on Thursday that its emissions cheating scandal began in 2005 with a decision to heavily promote diesel engines in the United States and a realization that those engines could not meet clean air standards.

    What followed was a textbook example of what happens when ambition combines with weak internal controls and ethical standards, the company acknowledged as it presented a preliminary report of its investigation into the origins of the scandal.

    Some employees, the company found, chose to cheat on emissions tests rather than to curtail Volkswagen’s American campaign.

    “There was a tolerance for breaking the rules,” Hans-Dieter Pötsch, the chairman of Volkswagen’s supervisory board, said here on Thursday, at his first lengthy news conference since the emissions cheating came to light in September. “That is the hardest thing to accept,” he added.

    At the news conference, which also included Matthias Müller, the Volkswagen chief executive, the company gave its most detailed explanation yet of what had led to the scandal. Mr. Pötsch said it was “the biggest test” in Volkswagen’s history.

    The company is in talks with United States regulators about how to make about 500,000 cars there comply with clean air rules. Mr. Müller said that he was optimistic that a technical solution would be announced in the coming days.

    The cheating began a decade ago, when Volkswagen was developing a new diesel engine and opted for a less expensive pollution control technology. Later, the German automaker phased in a newer technology that used the chemical urea to neutralize nitrogen oxide emissions, which are a harmful pollutant.<

    Cars with the newer chemical technology should have been able to pass emissions tests legally. But apparently, Volkswagen wanted to minimize the frequency with which customers or dealers would need to refill the tank that holds the chemical. And so Volkswagen programmed the cars to dial back emission controls — except when tests were underway — in order to minimize consumption of the chemical.

    “It proves not to have been a one-time error, but rather a chain of errors that were allowed to happen,” Mr. Pötsch said.

    While Volkswagen has been able to resolve the emissions problem in Europe at relatively low cost, the United States has stricter limits on nitrogen oxide emissions, which have been linked to lung ailments.

    Compounding the problem is that most of the cars sold in the United States are equipped with older technology that does not use urea to treat the emissions and will therefore be more difficult to bring up to standard. The company is likely to have to install new hardware in those vehicles, which include models such as the Jetta, Golf and Beetle sold before the 2015 model year.

    The company acknowledged that, in addition to wrongdoing by individual employees, the misconduct was the result of weak oversight and of “a mind-set in some areas of the company that tolerated breaches of the rules.”

    For example, the people who developed parts were the same ones who approved them for production. At other companies, it is standard practice for one team to develop components and another to check them for quality. Volkswagen said it would correct its procedures.

    “We have to understand how this came about,” Mr. Pötsch said. “That is the only way we can prevent it from happening again.”

    Volkswagen also said that nine people had been suspended as a result of the scandal, one more than had previously been disclosed. It said it could not disclose any names until the evidence was “watertight.”

    Yep, VW started off trying to cheat tests its cars couldn’t pass, but then proceeded to cheat tests its cars could pass:


    The cheating began a decade ago, when Volkswagen was developing a new diesel engine and opted for a less expensive pollution control technology. Later, the German automaker phased in a newer technology that used the chemical urea to neutralize nitrogen oxide emissions, which are a harmful pollutant.

    Cars with the newer chemical technology should have been able to pass emissions tests legally. But apparently, Volkswagen wanted to minimize the frequency with which customers or dealers would need to refill the tank that holds the chemical. And so Volkswagen programmed the cars to dial back emission controls — except when tests were underway — in order to minimize consumption of the chemical.

    It does indeed sound like there was “a mind-set in some areas of the company that tolerated breaches of the rules.” Some areas likely more than others.

    Posted by Pterrafractyl | December 10, 2015, 1:33 pm
  22. The EPA just filed a lawsuit against VW over the diesel emission scandal. Wish them luck. Especially if a bill moving its way through Congress dubbed the “VW Bailout Bill” becomes law. Because if it does become law, the EPA just might be the only entity that’s actually able to bring a meaningful lawsuit over the scandal. And not just in this case over the VW emissions. The “VW Bailout Bill” would effectively bailout any entity potentially facing a class-action lawsuit:

    The Fiscal Times
    A Bailout for Volkswagen? Congress Wants to Do Something Absolutely Crazy

    By David Dayen
    January 4, 2016

    When Volkswagen admitted to cheating on air pollution standards tests in September, it opened itself up not only to government punishment, but lawsuits from 500,000 U.S. purchasers of its “clean” diesel vehicles. Volkswagen has yet to fix the vehicles to bring them into emissions compliance, and even if it does, that will likely create a lower-performance car than consumers paid for.

    “Throughout these years, Volkswagen has been lying to us,” says Rebecca Kaplan, an at-large member of the Oakland City Council, who has been active in reducing carbon emissions in her city. “They’ve been undermining the very things that I have been fighting for.” Kaplan, who has stopped driving her non-compliant VW Golf TDI and rejected a lowball trade-in offer from the dealer, has joined one of hundreds of class-action suits against the automaker, likely to be consolidated into a large multi-district case.

    The combination of regulatory oversight and class-action litigation can keep companies in line. But a bill in Congress consisting of a little more than 100 words would not only prevent Kaplan from seeking justice but also cripple virtually all class-action lawsuits against corporations. It’s known as the “Fairness in Class Action Litigation Act,” but lawyers and advocates call it the “VW Bailout Bill.”

    The bill, which will get a vote on the House floor in the first week of January, follows a series of steps by the judiciary to block the courthouse door on behalf of corporations. “There’s no question the Supreme Court has ben moving in that direction to limit access to courts,” said Joanne Doroshow, executive director of the Center for Justice and Democracy. “But Congress has never done something like this, trying to step in and wipe out class-actions.”

    The simplicity of the VW Bailout Bill belies the chaos it would create. Proponents like the U.S. Chamber of Commerce, the bill’s leading lobbyist, say they merely want to get rid of “non-injury” class-action cases, based on potential damages from defective consumer products or corporate actions that have yet to result in harm. Lawyers for class-action litigants argue that defective products deserve compensation even if the consumer hasn’t yet been injured.

    But the bill goes much further, stating that courts may not certify class-action suits unless the plaintiff “affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative or representatives.”

    “This is devastating because it sets up all class-actions to fail,” says attorney Lori Andrus, who represents several Volkswagen plaintiffs. If every class member must have the same type and scope of injury, it forces extensive proofs for class certification — essentially a full-blown trial up front, where plaintiffs will have to prove that their injuries match with their fellow representatives.

    Not only would these trials be costly, but they would empower corporate defense lawyers’ schemes to limit damages. While current rules already require class members to have some level of commonality and typicality, the words “same type and scope” offer opportunities to refine that further. “It’s not clear what they mean by same injury,” says Andre Mura, another class-action plaintiff’s attorney. The terms are so vague, Mura argued, that they would have to be interpreted repeatedly, with unpredictable results.

    In the Volkswagen case, for example, “it could mean the same model car, the same defeat device, the same emissions system, the same consumer harm,” Mura says. “When really Volkswagen engaged in the same course of conduct on all their vehicles.” Defense attorneys could claim that a class representative who released fewer emissions because they drove fewer miles than their colleagues, or drove in harsher weather, or with lower tire pressure, should be excluded from the case. That could either whittle down classes to limit damages or disqualify them from certification.

    And the applications go beyond Volkswagen. “In a mortgage fraud case, the class might have all been deceived in same way, but the documents signed might have been inconsistent,” says Andrus. “Or with for-profit schools, they might have paid different tuition or taken different classes.” Andrus has battled these tactics before, but the congressional bill would codify them into law. “There’s no question this was written by a defense lawyer whose job it is to defend corporations,” she says.

    Without a class-action option, VW customers would have little recourse. “The damages are not enormous in the sense that I could hire individual counsel,” says George Farquar, a scientist and small business owner from Livermore, Calif., who is part of a class-action suit against the carmaker. “It’s amazing this legislation is being considered.”

    A Consumer Financial Protection Bureau study found that victims of just financial-related class-action settlements received over $2 billion in compensation between 2008 and 2012, to say nothing of the changes in corporate behavior arising from those cases. “The alternative is that those claims disappear,” says the Center for Justice and Democracy’s Doroshow. “You’re talking about providing basic immunity (to corporations).”

    Incredibly, the House is pairing the VW Bailout Bill with other legislation designed to limit corporate liability. The FACT (Furthering Asbestos Claim Transparency) Act would force public reporting of personal information of asbestos victims, in an effort to delay and limit compensation for their poisoning.

    The Chamber of Commerce also supports the FACT Act, claiming it would prevent double-dipping by mesothelioma sufferers who may have been exposed to multiple asbestos-lined products. But the clear intent is to both chill victims from coming forward and delay their compensation. Because mesothelioma sufferers typically only live between four and 18 months after diagnosis, this would shift many victim claims to wrongful death, which has a lower payout rate. Corporations like Honeywell have financial reason to want victims of their use of harmful chemicals to die quicker, so they can pay their families less.

    House passage of the VW Bailout Bill and FACT Act is likely, but the Senate could provide a roadblock. However, as we saw with the year-end omnibus, ideological bills that can’t otherwise pass on their own have a tendency to ride along with must-pass legislation and become law.

    Corporate immunity has been a major preoccupation of John Roberts’ Supreme Court. Rulings like AT&T Mobility v. Concepcion and American Express v. Italian Colors allow corporations to force their customers into mandatory arbitration, rather than the judicial system, to settle disputes. And 2011’s Walmart v. Dukes tossed out class-action certification in a gender discrimination case, arguing that the retailer couldn’t possibly have discriminated against all 1.5 million of its female employees in the exact same manner. Subsequent circuit courts have followed Supreme Court precedent and tightened class-action restrictions.

    But while the bar for class-action certification is already set incredibly high, the VW Bailout Bill adds an entirely new set of requirements, circumventing not only judicial precedent but also a longstanding federal rule (Rule 23) that lays out class-action standards. And it would protect corporations that engineer major frauds, where it is difficult to bring thousands of individual claims.

    “It’s incredibly inappropriate for Congress to send the message that it’s OK to hurt people by the millions,” said Volkswagen owner Rebecca Kaplan. “The more people you hurt, the more this law will protect you.”

    “This is devastating because it sets up all class-actions to fail”
    Yep, the GOP’s response to VW’s systematic scamming of US consumers is to make it effectively impossible for not just VW’s consumers but ALL American consumers to wage a class-action lawsuit against any corporation at all.

    Maybe those lucky VW owners can take their complaints into private-arbitration courts that’s all the rage these days. The owners that accepted VW’s ‘good will’ $500 cash payments will probably aren’t going to have a choice anyway if they decide to sue since an arbitration clause was added to the contract required to get the money. That should go well.

    Posted by Pterrafractyl | January 4, 2016, 7:42 pm

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