The current state of play in the Volkswagen diesel emissions scandal. Will UK VW owners get compensation?
Volkswagen has pledged to fix all European cars affected by the Dieselgate emissions scandal by autumn 2017, the European Commission has said after talks with the German carmaker.
A Volkswagen spokesman said the Group will "have all cars repaired by autumn 2017", and would offer owners "proof of conformity" that the cars no longer cheat in emissions tests.
The European Commission met with various consumer groups and national protection agencies, along with VW in September to look at whether the company has done enough to compensate owners.
The Commission is assessing whether the VW Group has broken two sets of EU consumer laws, the Consumer Sales and Guarantees Directive, and the Unfair Commercial Practices Directive. Both prohibit companies from making untruthful or inflated claims over their products.
Consumer Commissioner Vera Juorova said: "(They) set high standards for all the member states to enforce in case these rules are breached. It seems to be the case in so-called Dieselgate."
VW has so far rejected claims for compensation, but said it is in "regular and constructive dialogue with the Brussels authorities and institutions."
However, the Group is starting to face growing pressure to offer compensation, as a number of owners in Europe have set up legal cases against the carmaker.
In Ireland, legal representatives for Volkswagen walked out of court in Mayo, protesting the "unconventional" methods the court was pursuing. The case involves a mother of three seeking compensation after buying a car that cheated in emissions tests.
European consumer groups have already said the VW Group has not provided enough evidence and information to owners. Earlier in September, US courts convicted the first VW employee guilty of violating US clean air laws.
Veteran engineer James Liang was part of the team of engineers who developed the illicit defeat device. Liang has agreed to cooperate with the US Justice Department's investigation into the VW Group.
To see how VW has responded to the legal impact of the crisis around the world click here.
VW 1.2-litre TDI engine fix rolls out in Europe
Volkswagen will start fixing 460,000 cars with its 1.2-litre TDI engine this month. The EA189 engine is fitted to the Volkswagen Polo, Skoda Fabia and Seat Ibiza models and the recall will see a software update to amend the features that contributed to the emissions scandal.
Germany’s Federal Motor Transport Authority, the KBA, approved the recall, and will soon make a decision on the other affected engine, the 1.6 TDI.
In the UK 18,018 VW Polos are affected, and owners will be contacted directly in the next 10-14 days. The process will take from 30 to 60 minutes at an approved dealer.
VW ban in South Korea
South Korean authorities have halted sales of 80 Volkswagen Group models and imposed a £12m fine on the company after an investigation into the dieselgate emissions scandal. Allegations that the company has forged documents relating to emissions tests have resulted in the vehicles from the Volkswagen, Audi andBentley brands having their type approval revoked.
South Korea is a small but growing market for VW but the sales ban could see the group's vehicles off sale for an extended period. VW had already voluntarily halted sales of most of its models in the country from 25 July 2016, as it awaited the Korean government's decision, now it could be months before the vehicles are available to consumers again. "It usually takes three months for vehicle certification, but this may take longer for Volkswagen, as we will take thorough steps," the South Korean ministry for the environment said.
UK Government criticised over dieselgate compensation
In the UK MPs slammed the Government for showing "little interest" in pursuing and prosecuting Volkswagen for the emissions scandal, and criticised the carmaker for not offering compensation to affected UK owners.
A report published by the Transport Select Committee criticised the Department for Transport for being complacent in identifying whether Volkswagen broke the law in Europe by installing a defeat device in its cars. It condemned the DfT for trying to "pass the buck to the European Commission, which holds neither the evidence nor the power to prosecute."
MPs said responsibility to prosecute lies within national governments. The DfT was previously said to be considering launching a legal probe against Skoda, if the Czech manufacturer was found guilty of falsifying evidence in order to obtain type approval from the UK Vehicle Certification Agency. The DfT, however, has yet to launch a formal investigation into the company.
The report also criticised Volkswagen for offering US owners significant compensation - up to $10,000 (£7,514) - but not making a similar effort for affected owners in Europe and the UK. The Committee found this "deeply unfair."
Louise Ellman, chair of the Transport Select Committee, said: "Volkswagen Group has acted cynically to cheat emissions tests which exist solely to protect human health. Volkswagen's evidence to us was just not credible but the Government has lacked the will to hold VW accountable for its actions. There is a real danger that VW will be able to get away with cheating emissions tests in Europe if regulators do not act."
uestions over dieselgate fix in Europe
Volkswagen's fix for the emissions scandal hit cars in Europe was discredited by an Italian consumer group which claims vehicles that have undergone the fix to remove the defeat device emit nitrogen oxide (NOx) levels that are 25% above legal limits.
The Italian consumer group Altroconsumo, a member of the European Consumer Organisation (BEUC) tested an Audi Q5 that had been recalled by the VW Group and fitted with a new 'flow transfomer'. Even with the fix on-board, the consumer group's results showed the car to pollute 25 per cent above the EU legal limit.
Volkswagen’s fix for affected European cars involved a new ‘flow transformer’ which helps to improve the accuracy of the air mass sensor, which in turn improves the EGR flow rate, resulting in lower emissions.
Monique Goyens, Director General of the European Consumer Organisation (BEUC) said: “This is another blow for EU consumers and a new dimension of the VW scandal. This test by our Italian member clearly demonstrates that VW’s solution to deactivate the defeat device is not reliable.
“It is imperative that the German testing agency who approved the fix, but also their national counterparts, urgently re-examine the solutions to repair the affected cars and that they publish these results. Consumers need to be 100% certain that their car will be in conformity with emission thresholds after the recall.
“Volkswagen justifies compensation payments to US consumers with the argument that their cars cannot be as easily fixed as in Europe. This excuse now seems to be built on sand. VW must compensate European consumers. This is the only possible way forward for VW to make up for this ongoing consumer detriment.”
VW reaches a deal with US owners
Volkswagen reached a $15 billion (£11.3 billion) settlement with US car owners over the dieselgate emissions scandal. Under the deal VW is offering to buy back or repair vehicles affected by the dieselgate scandal as well as paying out compensation.
According to reports, the Volkswagen Group has set aside $10 billion (£7.51 billion) to repair or buy back around 475,000 vehicles with the 2-litre diesel engines found to have 'defeat device' software installed to cheat emissions tests. It has also agreed to compensate owners with payments up to $10,000 (£7,514). US owners of affected VW Group cars have already received gift cards worth $1,000 as an apology from VW. The Group initially struggled to find a fix for the 2.0-litre TDI engines after the California Air Resources Board rejected VW's initial proposals. The company says it has since found a fix CARB has approved.
The deal is also said to include $2.7 billion (£2 billion) in funds to offset the extra diesel emissions caused by the VW emissions scandal and a further $2 billion (£1.5billion) for research into eco-friendly cars and green energy initiatives.
No emissions scandal compensation for UK VW owners
In Europe, a fix for the dieselgate affected cars has been approved and recalls are underway. UK and European owners have not received any compensation and are unlikely to, according to previous statements from the Group although pressure from individual Governments is mounting. VW's reasoning is that the fix to VW's cars will have no impact on performance or economy and the cars can pass less stringent EU emissions tests without the defeat device. The repairs to affected US cars will be more complicated as the emissions test criteria in the US is far stricter.
Speaking before the Environment, Food and Rural Affairs Committee, Paul Willis, Managing Director of Volkswagen Group UK, said: “To pay compensation there has to be a loss, and at this stage I see no reason for there to be a loss. Our engineers tell us there will be no difference in fuel consumption or driveability.
“So the only other area is on the question of residual values. I, at the moment, have seen no clear evidence of adverse impact on residual values. So when I say that there is no loss, then there is also no need for compensation.”
Yet VW may not be off the hook completely. The UK Government has stated that if evidence of consumers suffering from falling residual values or vehicle performance emerges, VW would be liable to compensate owners.
Transport spokesman Viscount Younger of Leckie said: "The Competition and Markets Authority has not opened a formal investigation but is continuing to assess whether there is evidence of consumer harm."
How the emissions scandal evolved
The ‘dieselgate’ emissions scandal dates back to September 2015 when the US Environmental Protection Agency (EPA) found that the VW Group had built diesel cars with ‘defeat device’ software designed specifically to cheat emissions tests.
However, the scandal finds its origins in 1999 when Audi engineers, according to reports in the German media, created a defeat device to bypass emissions tests. The device, however wasn't used until 2005 when VW decided to launch an aggressive diesel campaign into the US and had to use the device to pass the emissions tests. Under the stricter standards in the US at the time, only 31mg/km of nitrogen oxides were allowed to be emitted, six fold less than the European standards at the time (Euro 5).
To meet budget and an approaching deadline, a group of engineers in the powertrain development division began to modify the engine management software, so the cars would meet the emissions criteria. A total of 15,000 individual algorithms were changed by the VW employees.
Around 11 million diesel cars with EA 189 1.2, 1.6 and 2.0-litre pre-Euro 6 diesel engines have been identified by Volkswagen as containing the ‘defeat device’ software. In the UK, over 1.1 million cars were sold with the malevolent software on board. The Group issued a worldwide recall to fix all affected VW, SEAT, Skoda andAudi vehicles.
Shortly afterwards, the VW Group also announced that an internal investigation had revealed that official CO2 and fuel economy figures for 800,000 of its vehicles contained irregularities. This was the first time VW admitted its Euro 6 compliant engines have been manipulated, and also widened the issue from diesel engines only to include petrol cars too.
The storm surrounding VW has reached the upper echelons of the corporate hierarchy with a shuffle in managerial positions, culminating in the former-CEO Martin Winterkorn resigning and being replaced by ex-Porsche boss Matthias Muller.
The new management board has taken up defensive positions by raising the amount of money set aside to cover the damages from £4.7billion to £12.6billion. However, no definitive verdict on the costs of the entire scandal has been made.
Although other car companies were all quick to state no such culture exists within their factories, news of Renault recalling 15,000 vehicles after the French government found their emissions above acceptable limits has added to the public scepticism.
VW recalls from March 2016 onwards
Volkswagen and the German Motor Industry Federation (KBA) have come up with technical solutions to the VW emissions scandal. 2.0-litre diesels will receive a software tweak, while vehicles with a 1.6-litre diesel will need to be fitted with a ‘flow transformer’ device to help the engine’s computer calculate the right amount of fuel and air being combusted.
This means around 400,000 UK cars will require mechanical changes - but VW says they should take less than an hour to make at dealerships. The software update for 2.0 engines will take around half an hour. A fix for the 1.2-litre unit is still under consideration.
VW confirmed the fix will not affect the performance or fuel economy of the cars, while Mueller also said the cars will pass the European emissions test (without cheating) after the fix has been installed.
The changes made as a result of the recall will have "negligible effect" on customer cars in terms of performance or fuel economy, with Mueller explaining that owners "won't be able to feel it."
Volkswagen has published the following timeline for UK recalls..
Though UK vehicles get by with software tweaks, vehicles in US and will need many more physical changes to the catalytic converters and the Selective Catalytic Reduction (SCR) AdBlue urea injection systems to pass the strict North American emissions criteria. This is going to take longer, and the Group announced it still does not have a confirmed timeline for North American owners.
Scroll down for everything you need to know about the VW emissions scandal...
Check if your VW Group car is subject to the recall
The VW Group has said that the following quantities of UK vehicles are set for a recall...
- • VW passenger cars - 508,276
- • Audi - 393,450
- • SEAT - 76,773
- • Skoda - 131,569
- • VW commercial vehicles - 79,838
Total VW Group cars set for UK recall: 1,189,906
The websites below let owners of VW Group cars check whether or not their models are fitted with the EA 189 engine and subject to the recall. All you need is your car's VIN number which should be located at the bottom corner of the windscreen on the driver's side or in the car's service book.
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