September 21 in new York hosted a presentation of the new model Passat 2016, which was made by lenny Kravitz, setting a festive mood for half an hour. During the same presentation to the guests with a short speech addressed Director of VW in the U.S. Michael horn, apologizing for what is happening in the company and noting that they will help the investigation. Not everyone present knew about 11 million vehicles, fraudulently certified that threaten the company billions in fines and criminal charges under articles. Since there were many apologies from other company executives, including the former Chairman of the Board of Directors of the holding company Volkswagen AG Martin Winterkorn.
According to Bloomberg, in 2014, researchers from the International Council on clean transport held in Europe test vehicles with diesel engines emission. The final results of the Volkswagen models seemed to them strange, and for a more accurate examination, they turned to their colleagues in the U.S., where the adoption of more stringent standards to protect the atmosphere from pollution. Together with the University of West Virginia using a not available in Europe equipment, the researchers first tested the car in laboratory conditions with a special dynamometer, and then on real roads.
The difference in results was astonishing — in artificial verifying compliance with standards, but emissions of harmful substances during the trip of 2000 miles from San Diego to Seattle many times exceeded the allowable value. Among the tested cars were diesel Volkswagen Jetta TDI, Passat TDI and BMW X5, and the performance of BMW was in the normal range on all tests. The staff of the Council on the protection of the California air resources held its laboratory tests and could not find violations.
At the end of 2014 Volkswagen stated that it was unable to find the cause of the difference in testing, withdrawing 500 thousand cars for software update. In California, researchers have continued testing this year and found that the emissions remain significantly exceeded the volume for the US, even after the software update. Studies have attracted the attention of the Agency for environmental protection in the U.S. (EPA), in partnership with the Council for the protection of Californias air resources, they began to investigate the situation and demanded an explanation from Volkswagen.
The process took months, but company officials were unable to explain clearly the reason. Then the EPA has threatened to deny certification of the diesel models 2016 if the German carmaker will not solve the problem with the difference between laboratory and real-world tests. Volkswagen admitted that he had installed on their cars with two-liter turbo diesel engine (TDI) program that allows you to receive positive results during laboratory testing. September 18, the EPA released the results of its investigation.
It turned out that on diesel models Volkswagen Jetta, Beetle, Golf, Passat and Audi A3 manufacturer installed two software mode is for normal driving and a test mode. It is a common practice, because laboratory testing implies the other conditions for the set of maneuvers that automotive system can perceive incorrectly, which will lead to instability, so you need a special mode for this situation. Modes Volkswagen McCarthyism normal program activates the reduction of harmful emissions in the exhaust during stationary testing, and on an ordinary road curbing emissions is disabled.
The amount of generated nitrogen oxide increases to almost 35 times on some models. Of course, the companys engineers know in detail about all the ways inspections and tests, so were able to teach the program to determine the group of indicators that when you need to pretend to be “clean diesel”. At the beginning of this year, Volkswagen was able to come out on top in terms of sales of cars in the world, ahead of Toyota, but still lag behind profit. First of all, Volkswagen wanted to become stronger and to increase sale in the USA.
The company did not manage to open up the second largest in the world automobile market ― the Americans prefer SUVs and Japanese manufacturers. In addition, in the States, tougher requirements for pollutant emissions into the atmosphere. Volkswagen has relied on models with diesel engines, which are sold well in Europe. The basis for the development in the market was the claim that two-liter Volkswagen TDI engines have high productivity, cost effectiveness and environmental friendliness.
Diesel engines can actually be more economical and more efficient than gasoline, emitting less carbon dioxide into the atmosphere, but produce large quantities of nitric oxide, is formed in the cities smog, acid rains. All this is very bad for health, especially children, causing respiratory illness, cancer, up to lethal outcomes. Such engines without filter petrol is not much better.
For manufacturers of diesel engines, the difficulty lies in finding the balance between efficiency and environmental pollution. It was good news that Volkswagen finally managed to find this balance. In recent years, the automakers have improved their diesel systems, learned how to use urea or urea high concentration for repayment of harmful diesel engine emissions (technology called AdBlue) and fuel with reduced sulfur content. But the installation of such a system increases and the price of the car, thus adding the cost of necessary purchases automotive urea to fuel itself.
Many were surprised that the German engineers were able to achieve such high levels of environmental performance even without such filtration systems. From 2009 to 2015 the company sold 11 million diesel cars. In the USA during this period were sold 482 thousand, a small percentage, but for a country where diesel engines are not popular and difficult to get certified, it is a good result. Moreover, future sales could be much higher.
In Europe the standards were not so strict that it became one of the reasons for the popularity of diesel engines, however, have led to environmental problems in large cities. New Volkswagen engines were supposed to help fix the situation. The Corporation decided that it would be nice not to raise the price range, while increasing capacity and maintaining positive emotions from driving such vehicles.
To do this, they invented the myth of “clean diesel”. But large-scale deception was uncovered. The German company stopped sales of its diesel models in the U.S. They have to fix millions of vehicles.
For this they have three options, none of them can be called painless. Buy cars in disappointed customers to install a decent filtration system or reconfigure the software for continuous monitoring of harmful substances, reducing the productivity. It seems that buyers are going to choose options, but Volkswagen have to disassemble half a million cases. And this is only the beginning.
The company faces a fine of up to $18 billion (group revenue last year ― $12 billion), the amount of which they can reduce only by openness and identifying specific perpetrators of people from the management of the company. The U.S. Department of justice opened an investigation, and if found evidence that confirms the intentional use of deception BY, for Volkswagen all get worse. Customers are already suing in court, for example, in Canada.
Negatively tuned and in the UK. Cars Volkswagen and other manufacturers decided to test in South Korea, France and the UK, and concern at home, in Germany, will be conducted a criminal investigation. To the problems in the US and added a serious problem in Europe, especially because it contains the main number of the 11 million sold two-liter TDI.
To protect in court the Volkswagen hired law firm Kirkland & Ellis, known for his work with BP during the oil disaster in the Gulf of Mexico, they realize the magnitude of the situation and will be protected, however, they will have even harder than BP in 2010. The companys shares fell by a third during the height of the scandal, but is now slowly increasing in price on the market, many believe that VW are able to rise after this. Moreover, they are the biggest market in China is almost unaffected diesel scandal ― where to buy diesel cars. But the former confidence not to return, certainly not in the next few years.
Source. Bloomberg. Replacing the departed on September 23, retired Martin Winterkorn tipped Matthias Mueller, Director of the Porsche. Himself Winterkorn said that takes responsibility for what happened, but he did not know about the violations and did not consider himself guilty.
The Volkswagen scandal influenced the entire automotive industry ― has fallen, and other companies, and because of a succession of scandals involving Hyundai and Kia, Toyota and General Motors total confidence in the brands of the buyers decreases. For Germanys problems in the Volkswagen ― an event of national importance, the company employs 593 thousand people around the world, for the countrys economy this is a very important organization.
In the Wake of the scandal, as written in The Guardian, it was reported that the German government may have already been aware of the existing fraudulent system, but did not know that it is used in cars of concern. If confirmed the communication of the Cabinet of Angela Merkel and offenders from Volkswagen, the decline threatens the entire European economy, and so are in a poor state. Suddenly, Volkswagen has become a greater problem for the German economy than the debt crisis in Greece. If sales of Volkswagen will drop in North America in the coming months, this will affect not only the company but also on the German economy in General.
Scandals with automotive companies has happened throughout the history of the industry, but the situation with the largest Volkswagen. In addition, violations of this nature may be found in other companies, which will lead to a deep crisis of the automotive industry. Now there is a discussion about a possible tightening of the rules of test vehicles on air pollution and control options internal software machines.
From 2017 in Europe for mandatory tests will be added and tested on real roads. For diesel engines this is most likely the beginning of the end. But electric cars will become more popular, the Volkswagen should pay attention to it. In Vox estimate how much cheating Volkswagen could affect peoples health.
At a rough estimate, if we consider all of the 11 million diesel engines, each year from poisoning allocated these machines nitrogen oxides died from 58 to 520 people for 6 years. It is worth noting that in humans is influenced by many other factors, its impossible to know the direct impact of Volkswagen.