EPA on Sept. 18 issued a notice of violation (NOV) of the Clean Air Act (CAA) to Volkswagen AG, Audi AG and Volkswagen Group of America Inc. (collectively referred to as Volkswagen). The NOV alleges that four-cylinder Volkswagen and Audi diesel cars from model years 2009-2015 include software that circumvents EPA emissions standards for certain air pollutants. California separately is issuing an In-Use Compliance letter to Volkswagen, and EPA and the California Air Resources Board (CARB) both have initiated investigations based on Volkswagen’s alleged actions.
“Using a defeat device in cars to evade clean air standards is illegal and a threat to public health,” said Cynthia Giles, assistant administrator for the Office of Enforcement and Compliance Assurance. “Working closely with the California Air Resources Board, EPA is committed to making sure that all automakers play by the same rules. EPA will continue to investigate these very serious matters.”
“Working with U.S. EPA, we are taking this important step to protect public health thanks to the dogged investigations by our laboratory scientists and staff,” said Air Resources Board Executive Officer Richard Corey. “Our goal now is to ensure that the affected cars are brought into compliance, to dig more deeply into the extent and implications of Volkswagen’s efforts to cheat on clean air rules, and to take appropriate further action.”
As described in the NOV, a sophisticated software algorithm on certain Volkswagen vehicles detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test. The effectiveness of these vehicles’ pollution emissions control devices is greatly reduced during all normal driving situations. This results in cars that meet emissions standards in the laboratory or testing station, but during normal operation, emit nitrogen oxides or NOx, at up to 40 times the standard. The software produced by Volkswagen is a “defeat device,” as defined by the Clean Air Act.
Volkswagen Responds
“The Board of Management at Volkswagen AG takes these findings very seriously,” said Prof. Dr. Martin Winterkorn, CEO of Volkswagen AG, in a statement. “I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly and completely establish all of the facts of this case.”
He further said that Volkswagen has ordered an external investigation of the matter, adding: “We do not and will not tolerate violations of any kind of our internal rules or of the law.”
The Clean Air Act requires vehicle manufacturers to certify to EPA that their products will meet applicable federal emission standards to control air pollution, and every vehicle sold in the U.S. must be covered by an EPA-issued certificate of conformity. Motor vehicles equipped with defeat devices, which reduce the effectiveness of the emission control system during normal driving conditions, cannot be certified. By making and selling vehicles with defeat devices that allowed for higher levels of air emissions than were certified to EPA, Volkswagen violated two important provisions of the Clean Air Act.
EPA and CARB uncovered the defeat device software after independent analysis by researchers at West Virginia University, working with the International Council on Clean Transportation, a non-governmental organization, raised questions about emissions levels, and the agencies began further investigations into the issue. In September, after EPA and CARB demanded an explanation for the identified emission problems, Volkswagen admitted that the cars contained defeat devices. The denied the allegations for more than a year.
Customers, Congress and Wall Street Respond
VW may be liable for civil penalties and injunctive relief for the violations alleged in the NOV, and several class action lawsuits on behalf of owners – who thought they were making an environmentally friendly choice – and car dealers already have been filed. Wall Street responded quickly, with Volkswagen stock prices tumbling more than 20 percent when the news was made public.
It is possible that Congress will convene hearings, and at least one lawmaker already has spoken up about the “If Volkswagen willfully sought to evade the Clean Air Act and fraudulently sold cars to millions of consumers with this technology, EPA should pursue the most severe action possible to deter others from doing the same,” said Rep. Frank Pallone Jr. (D-NJ), ranking member on the House Committee on Energy and Commerce. “Such deceitful actions violated the law and misled consumers, while other law abiding companies were disadvantaged and the public health was put at risk. We must ensure that this does not happen again and that consumers can trust the products that they buy.”
The allegations cover roughly 482,000 diesel passenger cars sold in the United States since 2008. Affected diesel models include:
- Jetta (Model Years 2009 – 2015)
- Beetle (Model Years 2009 – 2015)
- Audi A3 (Model Years 2009 – 2015)
- Golf (Model Years 2009 – 2015)
- Passat (Model Years 2014-2015)
In a press release, EPA noted, “It is incumbent upon Volkswagen to initiate the process that will fix the cars’ emissions systems. Car owners should know that although these vehicles have emissions exceeding standards, these violations do not present a safety hazard and the cars remain legal to drive and resell. Owners of cars of these models and years do not need to take any action at this time.”
Said Volkswagen’s Winterkorn: “The trust of our customers and the public is and continues to be our most important asset. We at Volkswagen will do everything that must be done in order to re-establish the trust that so many people have placed in us, and we will do everything necessary in order to reverse the damage this has caused. This matter has first priority for me, personally, and for our entire Board of Management.”