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Diesel Cheating An Open Secret at VW – or Was It?

CEO Mueller disputes reports, denies managers involved.

by on Jan.29, 2016

Volkswagen CEO Matthias Mueller.

It was an open secret within Volkswagen’s engineering department that the maker was cheating on diesel emissions testing, according to a report in an influential German newspaper.

The Sueddeutsche Zeitung report contends that a number of managers, as well as their staff either knew about, or were directly involved in, the efforts to create a so-called “defeat device” intended to fool emissions testers into believing VW’s 2.0-liter turbodiesel complied with tough U.S. emissions mandates. But a culture of collective secrecy kept engineers from advising corporate executives of the problems they faced.

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“Within the company there was a culture of ‘we can do everything’, so to say something cannot be done, was not acceptable,” Sueddeutsche Zeitung said, claiming to quote comments from a whistleblower who came clean as part of an ongoing, internal investigation within Volkswagen.

Earlier news coverage from Germany suggested dozens of VW insiders have been coming clean as part of that investigation.

The VW badge gracing the maker's BUDD-e concept minivan revealed at CES.

That would suggest that far more VW employees were involved in the subterfuge than the company has suggested. Top executives, including U.S. boss Michael Horn, as well as global VWAG CEO Matthias Mueller, have repeatedly insisted the cheating was done by a “handful” of engineers.

And Mueller took a similar tone this week. Responding to the German news report, he told reporters, “No one has spoken with me,” during an industry conference in Europe on Thursday. “You got the information from some sources who have no idea about the whole matter.”

Mueller has tried to downplay the scandal and move on, promising to launch a fix this month for the 11 million vehicles equipped with the suspect software. But so far, VW has been unable to reach an agreement with either the U.S. Environmental Protection Agency or the California Air Resources Board on a plan that they can accept.

Mueller also came under fire as a result of comments made to an NPR reporter during the Detroit Auto Show. He initially said VW “did not lie” about the diesel cheating, insisting it was the result of not properly understanding U.S. rules and regulations.

(For more on the controversy surrounding Mueller’s comments, Click Here.)

Almost 500,000 of VW’s diesel vehicles sold in the U.S. were equipped with the defeat device.

(VW appoints new boss for North America. Click Here for the full story.)

During his talk with reporters this week, Mueller said he would not disclose any of the details of the ongoing internal investigation. Conducted by the U.S. law firm Jones Day, the plan is to publicly release the results on April 21st for the carmaker’s annual general meeting, or AGM.

The EPA recently rejected the first fix VW proposed for diesel models sold in the U.S.

“Is it really so difficult to accept that we are obliged by stock market law to submit a report to the AGM on April 21,” said Mueller, “and that it is not possible for us to say anything beforehand?”

VW’s troubles aren’t likely to end with the release of the report. The company is facing lawsuits around the world related to the emissions cheating. That includes more than 450 lawsuits that have been consolidated and will be handled by a federal court in San Francisco. The U.S. Department of Justice, meanwhile, this month filed suit against the maker on behalf of the EPA.

All told, VW faces the possibility of paying out billions of dollars in fines, fees and settlements. The company has so far set aside over $7 billion to handle the matter, while also setting up a credit line that could give it access to about $20 billion more.

(VW lands in second place for 2015 behind global auto sales leader Toyota. Click Here for the story.)

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3 Responses to “Diesel Cheating An Open Secret at VW – or Was It?”

  1. Chris Holman says:

    When the entire truth of this episode is finally out I for one hope it sends a message to all manufacturers in all sectors, that all people are tired of being ripped off & lied to by Billion $$ companies that don’t need to go to these extremes to achieve their goals. How about we just don’t be quite so greedy?

    • GT101 says:

      Chris-

      Changing your screen name hasn’t changed your hate nor your inability to deal with reality.

      Would you consider GM one of those companies that doesn’t need to go to extremes to increase their goal of increased profits? We’re talking about the same GM responsible for 100+ deaths as a result of a defective ignition switch and cover up? This would also be the same GM that the U.S. tax payer’s bailed out so that GM could use the funds to expand their facilities in China. This would be the same GM who is manufacturing Buick and Cadillac vehicles in China for sale in the U.S. while exporting U.S. jobs to China. Is THAT the excellent U.S. company that you feel should escape accountability for the 100+ deaths and other unscrupulous activities? Does it appear to you that GM might be going to extremes to achieve their goals? Is it clear to you the damage that GM has done to the people they KILLED and the U.S. jobs they have eliminated?

      Your veiled comments aren’t fooling anyone. Your disconnect from reality and your hate haven’t changed a bit regardless of what screen name you use.

      When Obama is booted from office you’re going to see a shake-up at the EPA and the crazy tree huggers are going to be removed and their reign of destruction will be brought to an end. I personally hope that some competent law firms sue the EPA for billions of dollars in damages they have caused innocent people all around the world who had nothing what so ever to do with the VW emissions and ruse by the EPA. Never in history has the EPA so over-reacted to a trivial emissions violation to conceal a horrendous methane gas leak in CA that is doing 1000 times more damage then any VW diesel emissions violation could ever do.

      Isn’t it interesting how the mainstream media isn’t blasting the airwaves or internet or newspapers with sensational stories about the methane leak in CA? Why is this massive environmental damage of no concern to the mainstream media but a trivial exhaust emissions violation is earth shattering according to those who profit from Yellow journalism? Why is that? I’d like to know. Not only has the media given GM a free pass for killing 100+ people, the EPA is getting a free pass on abuse of power against VW in an orchestrated campaign to distract from the environmental disaster in CA.

      Anyone who doesn’t understand how political and corrupt the EPA can be should educate themselves.

  2. GT101 says:

    Here we go again with The Detroit Bureau quoting a proven UNRELIABLE source – The Sueddeutsche Zeitung. These are the same clowns who insisted that VW diesel models could not be made to comply with EPA emissions even AFTER the EPA had already certified these vehicles to have passed all EPA requirements in effect at the time the vehicles were sold. The ignorance spewed by this source is likely to cost them millions when VW sues them for malicious fraud. No reputable media source has ever suggested a corporate mentality of cheating at VW. It’s outrageous for any of the media to repeat these malicious claims without a shred of evidence to support the meritless claims. This is a perfect example of Yellow journalism where the media wants to create their own stories and bias against an entity – for financial profit of course. Thankfully libel laws are enforced in Germany so this could be an expensive learning lesson for unscrupulous media.

    And why does some of the media continues to claim VW lied when they never lied? VW has cooperated 100% with all authorities around the world to resolve any issues with the EA189 series diesel engines and allowed independent investigations into other areas of their business while hiring two independent firms to do a complete investigation into the rogue group of VW programmers and engineers who perpetuated the illegal software. When Mueller told the gathered media that VW did not lie, Mueller was totally correct. VW the corporation has NEVER lied about the emissions issues at all.

    The EPA/CARB and many in mainstream media have created a smoke screen ruse by blowing VW deal drastically out of proportion to conceal a monumental air pollution disaster in California that they don’t want the public to know about because it is THOUSANDS of time worse than any excess exhaust emissions by all VW diesels.

    The link below shows that the EPA and CARB are unscrupulous, political criminals on a witch hunt to end clean diesel sales in the U.S. while ignoring a true environmental disaster. If these political criminals can rape VW for billions in the process for a totally insignificant emissions violation that hurt no one, they will. Why isn’t the mainstream media outraged about the EPA/CARBs failure in California and the monumental damage these folks ignoring to the environment?

    Read and understand the politics of the criminals in the U.S.

    http://www.autoblog.com/2016/01/28/californias-methane-leak-wiped-out-ev-benefits/