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VW Set to Plead Guilty as Buyback Accelerates

Court move would lock down $4.3b criminal settlement.

by on Mar.10, 2017

A new VW Arteon prototype makes its debut at this week's Geneva Motor Show.

Volkswagen is expected to plead guilty in U.S. District Court in Detroit today, wrapping up a settlement with the federal government for cheating on diesel emissions tests.

The move follows a series of civil settlements, and will cost the automaker $4.3 billion, the figure announced in January at a news conference by government regulators just days before the end of the Obama Administration. Seven current and former Volkswagen employees have faced criminal charges for their role in the diesel rigging, though one has already pleads guilty. Only one of the others is currently in custody.

Beyond the Headlines!

All told, the German automaker has so far agreed to spend more than $20 billion in civil and criminal fines and other costs. It is currently ramping up the buyback of around 475,000 2.0-liter diesels equipped with so-called a “defeat device” meant to reduce emissions during emissions testing. A separate deal covers more than 40,000 vehicles with 3.0-liter turbodiesels, though VW believes it can repair some of those.

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California Regulators Reject VW Plan to Repair 3.0-Liter Diesels

German maker still hopes to avoid another buyback program.

by on Jul.14, 2016

The fix would have covered VW and Porsche products - as well as the Audi diesels shown here.

Volkswagen’s plan to recall and repair thousands of vehicles using its rigged 3.0-liter diesel has gotten the thumbs-down from California regulators.

VW late last month agreed to spend $14.7 billion to settle consumer lawsuits and U.S. government allegations that it cheated on emissions tests involving its 2.0-liter turbodiesel. The deal includes plans to buy back about 475,000 of those vehicles sold in the U.S. since 2009. But the German maker said it was working up a fix for the larger 3.0-liter diesel that would eliminate the need for a similar buyback program.

Breaking News!

That proposal has been rejected, according to a letter the California Air Resources Board has sent to VW. It declared that the proposed fix is ” incomplete, substantially deficient, and fall(s) far short of meeting the legal requirements to return these vehicles to the claimed certified configuration.”

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Feds Outline Diesel Emissions Settlement with VW

But “criminal investigation is (still) active and ongoing.”

by on Jun.28, 2016

EPA Administrator Gina McCarthy calls the settlement "unprecedented" under the Clean Air Act.

Describing the settlement as “groundbreaking” and “unprecedented,” federal officials outlined a $14.7 billion, three-part deal with Volkswagen that will, among other things, remove as many as 475,000 diesel vehicles from U.S. roads.

But the agreement, which could yield significant compensation for those who own those vehicles, does not end the German automaker’s legal and financial problems. VW still has to reach a settlement covering about 50,000 additional vehicles. And it could yet face criminal charges and civil fines stemming from its efforts to cheat on government emissions tests.

Clearing the Air!

The settlement “marks the largest clean air mitigation step in the history of the Clean Air Act,” declared Deputy U.S. Attorney General Sally G. Yates during a news conference in Washington, D.C. But, she added, “It is by no means the final step.” Among other things, she added, “I can assure you our criminal investigation is active and ongoing.”

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VW Back in the Black but Diesel Scandal Takes a Stiff Toll

Profits down 20% year-over-year.

by on May.31, 2016

VW gets back into the black for Q1, but the maker see lower sales and smaller margins for all of 2016.

Volkswagen AG clawed its way back into the black during the first quarter of this year following the spectacular plunge it took last year as it dealt with a global diesel emissions scandal.

Even so, the maker’s $2.6 billion profit for the January-March quarter was down 20.1% from year earlier numbers. Excluding one-time items, VW’s operating profit was down 5.9%, to $3.5 billion. Sales and other revenues, meanwhile, slipped 3.4%, to $56.8 billion.

By the Books!

“In light of the wide range of challenges we are currently facing, we are satisfied overall with the start we have made to what will undoubtedly be a demanding fiscal year 2016,” VW CEO Matthias Mueller said in a statement.

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EPA Looking at Claims Mercedes Rigged Diesels

But no formal investigation, government says.

by on Feb.29, 2016

In 2012, Mercedes launched a U.S. S-Class diesel for the first time since 1995.

Barely a week after a Seattle law firm filed a class action lawsuit against luxury carmaker Daimler AG, the U.S. Environmental Protection Agency confirmed Monday that it is looking into claims the automaker’s diesel vehicles were illegally rigged to pass American emissions standards.

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The agency says it wants data but cautions that it has not yet opened a formal investigation. Parent of Mercedes-Benz denies allegations and says it is fully cooperating with the government.

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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.

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VW CEO Insists the Maker “Didn’t Lie”

California regulators reject proposed diesel emissions fix.

by on Jan.13, 2016

Volkswagen CEO Matthias Mueller.

Even as he continues to apologize for the diesel emissions scandal embroiling his company, Volkswagen CEO Matthias Mueller has touched off another firestorm with comments he made this week in Detroit, insisting that the maker “didn’t lie.”

Mueller’s comments, made to NPR at the North American International Auto Show in Detroit, came the same day regulators in California rejected the fix Volkswagen had proposed for close to 500,000 diesel vehicles equipped with a so-called “defeat device” designed to help it illegally pass U.S. emissions tests.

Keeping Things Honest!

“We had not the right interpretation of American law,” Mueller said in an interview with the network. “We didn’t lie. We didn’t understand the question first. And then we worked since 2014 to solve the problem. And we did it together and it was a default of VW that it needed such a long time.”

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VW, Porsche, Audi Order Stop-Sale on High-Line Diesels

But German brands contend they didn't cheat with 3.0-liter diesel.

by on Nov.04, 2015

The Audi Q7 TDI is one of the numerous Audi, Porsche and VW models affected by the stop-sale.

Volkswagen and its Audi and Porsche brands have ordered a stop-sale on a wide range of high-end diesel vehicles accused by the Environmental Protection Agency of using hidden software to cheat on emissions tests.

But the German maker contends the code identified by the EPA was not intended to hide pollution problems with the company’s 3.0-liter turbodiesel but actually to further reduce emissions in real-world conditions.

Getting to the Facts!

“It’s an auxiliary emissions control device, not the defeat device used in the 2.0-liter diesel,” said Audi spokesman Brad Stertz, referring to the smaller diesel engine used in 11 million vehicles sold worldwide, including 482,000 sold in the U.S. over a seven-year period.

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VW To Begin Diesel Recall in January – if it Gets EPA Nod

by on Oct.07, 2015

New VW CEO Matthias Mueller says the maker faces an "evolution," not a "revolution."

Volkswagen’s new CEO Matthias Mueller hopes to see a recall affecting as many as 11 million of the German maker’s diesel vehicles begin in January – but for the 482,000 of those cars sold in the U.S., VW must still win regulatory approval for the planned retrofit.

Even as Volkswagen moves ahead with plans to fix vehicles equipped with software designed to cheat on emissions tests, its problems are mounting. Among other things, the Senate Finance Committee has opened a probe investigating whether the carmaker falsely claimed more than $50 million in tax credits for meeting emissions standards.

Breaking News!

“If all goes according to plan, we can start the recall in January. All the cars should be fixed by the end of 2016,” Mueller says in an interview published today by the German newspaper, the Frankfurter Allgemeine Zeitung, or FAZ. But that timetable might be difficult to meet, especially in the U.S., where the scandal was originally touched off last month.

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Chrysler, Other Automakers Could Be Swept Up in Emissions Cheating Scandal

Daimler, BMW insist they didn’t rig diesel tests.

by on Sep.25, 2015

The tainted VW diesel was used by other manufacturers for such models as this Dodge Avenger.

© 2015 TheDetroitBureau.com

German authorities now say 2.8 million Volkswagen diesel vehicles sold in that country “are affected” by the maker’s rigging of emissions tests. But VW may not be the only maker implicated. The suspect turbodiesel engine used by Volkswagen apparently also was sold to several other manufacturers, including Chrysler and Mitsubishi for use in some of their European models.

Regulators there and in the U.S. are planning to expand random testing to include not just VW models but diesel vehicles sold by other manufacturers. Several reports from Europe indicate that some Daimler AG and BMW models might also exceed emissions standards, though it is unclear if that implies any intentional efforts to game the testing process.

The Last Word!

For their part, the two makers insist they have followed the letter of the law, both in Europe and in other markets including the United States.

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