US Volkswagen chief ‘knew of emissions problem in 2014’

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A Volkswagen Passat TDI radial is seen in central London, Britain September 30, 2015. Volkswagen UK said on Wednesday around 1.2 million vehicles in Britain, including Audi, Seat and Skoda cars, were affected by the emissions software at the centre of an investigation into rigging of vehicle emissions tests. REUTERS/Stefan Wermuth

Volkswagen’s US chief revealed he knew more than a year ago that the group’s cars possibly breached pollution rules, as he prepared to apologize before Congress over the massive scandal.
In testimony released ahead of his hearing before a congressional committee, Michael Horn offered a “sincere apology” over Volkswagen’s use of a software designed to cheat pollution tests.
The German auto giant sank into the deepest crisis of its history after revealing that it equipped 11 million of its diesel vehicles worldwide with software that switches the engine to a low-emissions mode during tests.
The so-called defeat devices then turn off pollution controls when the vehicle is on the road, allowing it to spew out harmful levels of toxic gases.
The shocking revelations have wiped more than 40 percent off Volkswagen’s market capitalization, but the direct and indirect costs are still incalculable as the company risks fines in several countries and possible damages from customers’ lawsuits.
Horn said he learned in early 2014 of “a possible emissions non-compliance,” after researchers at the University of West Virginia found that VW cars it had tested were releasing up to 40 times as much nitrogen oxide as was legally permissible.
He said he was told by his staff that US authorities could conduct tests for defeat devices, and was subsequently informed later that year that technical teams had a plan to bring the vehicles into compliance and were working with the authorities on the process.
Volkswagen finally admitted to US regulators in September this year that hidden software installed in certain diesel vehicles “could recognize whether a vehicle was being operated in a test laboratory or on the road,” Horn said.
Admitting that the company had “broken the trust of our customers, dealerships, and employees, as well as the public and regulators,” Horn said: “We at Volkswagen take full responsibility for our actions and we are working with all relevant authorities in a cooperative way.”
Investigations being conducted on a global scale will identify those responsible for the scam and hold them accountable, he said.
Separately, VW Korea President Thomas Kuehl issued an apology in the Asian country.
“I sincerely apologize over betraying customers’ trust,” Kuehl said in a newspaper advertisement in South Korea.
At home in Germany, Volkswagen’s new chief Matthias Mueller has said four employees were suspended over the deception, adding however that he did not believe that top management could have been aware of the scam.
He said in an interview published Wednesday by the Frankfurter Allgemeine Zeitung however that the development of an engine is “a complex process” but that these were tasks in which “a director is not directly involved.”
“Do you really think that a boss would have the time to be concerned about the details of engine software?” he said.
Claims emerged in media reports that Volkswagen had not only deliberately fitted the cars sold in the US market with the defeat devices, but had also intentionally sought to cheat tests in Europe by doing so with vehicles sold on the continent.
“In Europe too, Volkswagen effectively cheated on emissions in a systematic manner,” newspaper Sueddeutsche Zeitung claimed, citing its own research in collaboration with public broadcasters NDR and WDR.
It added that “without the cheating software, the affected cars would not have been authorized under the Euro 5 emissions regulation.”
A VW spokesman said whether the defeat devices were activated in Europe was still a subject of investigations. He added that it remained “legally unclear if the device was forbidden under European rules.”
The car group, which submitted its plans and timetable to bring vehicles to compliance to German authorities on Wednesday, is planning to begin recalling affected vehicles from January.
But it admitted that it would only be able to complete the refitting by the end of 2016.
The group has set aside 6.5 billion euros in the third quarter over the affair, but that was only the estimated sum to cover repairs of affected vehicles. The cost of fines and potential damages arising from lawsuits is hard to calculate.
In the United States alone, Volkswagen faces up to $18 billion in fines from the Environmental Protection Agency, plus potential payouts from class action lawsuits and penalties from other regulators.
Asked about the looming fines, Mueller said, however: “Think about this: no one died from this, our cars were and are safe.”

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