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Volkswagen has announced that the diesel emissions scandal will cost the company an extra $3 billion (€2.5 billion), because engines are proving “far more technically complex and time consuming”.

The additional cost, for fixing engines in the US, takes the total bill to $30 billion.

Two years after the diesel emission cheating scandal first emerged, VW is still struggling to put the crisis behind it.

Separately Munich prosecutors made an arrest in connection with the scandal.

German media reports have named the person taken into custody as Wolfgang Hatz, former board member at VW unit Porsche. But there has been no official confirmation of his identity.

Wolfgang Hatz was head of Research and Development at VW-owned Porsche and had held other roles in the VW group, including in engine development at Audi. He was suspended after the diesel emissions test-cheating was exposed. He then left the company.

VW Emissions Scandal: Company to Provide Two Year Guarantee for Europe Cars

VW Emissions Scandal: CEO Mathias Muller Investigated by Stuttgart Prosecutors

Diesel Emissions Scandal: VW Pleads Guilty to Three Charges in US

In 2016, Porsche said no evidence had been found against Wolfgang Hatz.


Wolfgang Hatz was reportedly close to former VW chief executive, Martin Winterkorn, who has denied any knowledge of the “defeat devices” which allowed vehicles to artificially reduce emissions during tests before their existence was exposed publicly.

Another former Audi executive, Giovanni Pamio, was taken into custody earlier this year, at the request of the US Department of Justice. One man has so far been jailed in connection with the scandal: Volkswagen engineer James Liang received a 40 month sentence in a US court last month.

News of the additional financial burden from dealing with vehicles in the US underlines the difficulty VW is having extricating itself from the scandal.

VW shares initially fell sharply on September 29 although they later recovered most of the lost ground.

The automaker first admitted in September 2015 that it had used illegal software to cheat US emissions tests.

Since then VW has been adapting its cars to meet legal requirements. However,  the process in the US is proving tougher than expected.

It is also amending cars in Europe, but the process there is more straightforward, VW said.

The additional costs will be reflected in Volkswagen’s third quarter results, which will be reported next month.

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VW CEO Matthias Muller is being investigated by Stuttgart prosecutors in connection with the emissions scandal that erupted at the auto maker in late 2015.

It is the first time Mathias Muller has been named in connection with official investigations into the affair.

His predecessor, Martin Winterkorn, and the current VW chairman, Hans-Dieter Poetsch, are also under scrutiny.

Mathias Muller became VW chief executive after the scandal broke.

However, at the time he was a board member of Porsche SE, the holding company which owns a majority of voting shares in the Volkswagen Group.

Image source Wikimedia

Mathias Muller was also chief executive of the Porsche sports car business, a subsidiary of the VW Group and Porsche SE.

The investigation is not looking into the causes of the scandal itself, but at how the board of Porsche SE, including Mathias Muller, responded to it.

Prosecutors suspect that executives deliberately delayed releasing information to investors about the scale of the scandal, as well as its financial consequences.

A similar investigation, into possible market manipulation by executives within the VW Group, was launched in Volkswagen’s home state of Lower Saxony in 2016.

In the wake of the scandal, VW’s share price dropped dramatically. Investigators are examining whether executives knew about the magnitude of the unfolding scandal – which began in the US – but failed to inform the markets in a timely manner.

As a rule, executives are expected to keep investors updated as soon as potentially price-sensitive information comes to light.

Porsche SE said the allegations were unfounded, adding it had complied with disclosure rules.

The holding company is based in Stuttgart. It is owned by the Porsche and Piech families – descendants of Ferdinand Porsche, the man who designed the Volkswagen Beetle and founded the sports car business that bears his name.

Salvează

Over 60 years ago, Chevrolet began production for the first ever small-block V8 engine, kick-starting what would become an American love affair that would last for generations. Since its debut, the small-block V8 has remained in production, making it the longest mass-produced car engine in history. Despite its decades of popularity and innovation, a lot of auto manufacturers are drawing away from the classic American powerhouse in the face of fuel efficiency regulations.

Image from Wikimedia

During the Obama administration, the federal government came to an agreement with large automakers to raise the industry’s fuel efficiency standard to 54.4 miles by the year 2025. Now, a mere eight years to the deadline, car companies are being forced to start adopting alternative energy and smaller, more efficient engines. The results have been pretty bleak for any car-nuts.

The Ford F-150, which ranks among the best-selling vehicles of all time, has recently dropped the V8 engine, substituting it for a more efficient and powerful engine in the form of the EcoBoost V6. General motors have ditched their V8-powered Chevrolet SS from their fleet, which had also enjoyed a lot of popularity in previous years. Even the hallowed Ford GT has come back to the road with a 3.5-litre EcoBoost V6, although this hasn’t made much of a dent in its horsepower. Although more efficient exhaust systems from companies like Borla are still fairly popular among people who modify their own cars, we’re expected to see more and more fuel-efficient models coming straight out of the factory.

Even the most efficient auto manufacturers, some of which don’t have a single V8 in their entire fleet, are beginning to feel the sting of federal fuel economy standards. Mazda, for example, leads the way when it comes to efficiency, averaging out at 30.7 miles to the gallon. Honda comes in second, rated with an average of 28.7 miles to the gallon.

The bottom of the barrel in terms of fuel efficiency includes those that have decided to make do with larger engines, namely well-known American badges. Despite new engines throughout the fleet, Fiat Chrysler, which now owns Jeep and Dodge, has a mere average of 22.2 miles to the gallon across their entire line-up. Ford comes in second worst, with just 23.4 miles to the gallon. General Motors have followed through with a comeback of the Canyon and Colorado mid-sized pickups, which average at just 24 miles per gallon.

Trying desperately to comply with the looming federal regulations, a lot of automakers are making major cuts. Having said that, progress seems to be pretty slow. Mazda has introduced GDI technology in various cars in its fleet. German giants such as Volkswagen, BMW and Mercedes have all turned to turbocharging instead. Some companies, including Ford, Chrysler, and Honda, have begun to add cylinder deactivation to emerging models. Despite these steps, the auto industry as a whole doesn’t seem to be on-schedule to meet with the standards the EPA set out during the Obama administration. As Trump tries to roll these back and the green lobby keeps growing, the future is very uncertain.

VW has pleaded guilty to three charges as part of a $4.3 billion agreement with the US authorities over the diesel emissions scandal.

The automaker has pleaded guilty to conspiracy to commit fraud, obstruction of justice and entry of goods by false statement.

VW general counsel Manfred Doess told a court in Detroit the company was “guilty on all three counts“.

Manfred Doess said the criminal acts occurred in both Germany and the United States.

Volkswagen admitted that vehicles were fitted with illegal software which allowed them to cheat emissions tests over a six-year period.

John Neal, an assistant US attorney, told the district court that the scheme “was a well thought-out, planned offensive that went to the top of the organization”.

Under the deal with the DoJ, VW agreed to major reforms and scrutiny by an independent monitor for three years after admitting to installing the secret software in 580,000 US vehicles.

The devices enabled VW’s diesel vehicles to emit up to 40 times legally allowable pollution.

Accepting VW’s guilty plea, district judge Sean Cox said: “This was a very, very serious crime.”

VW has agreed to change the way it operates in the United States and other countries as part of the settlement.

In January 2017, VW agreed to pay $4.3 billion in US civil and criminal fines.

A company spokeswoman said it “deeply regrets the behavior that gave rise to the diesel crisis”.

Since the emissions scandal broke in September 2015, VW has agreed to pay about $25 billion to address claims from owners, regulators, states and dealers in the US.

VW has come under pressure to pay compensation in other markets too.

However, the fallout from the scandal has not stopped VW from growing its sales. In 2016, VW overtook Toyota as the world’s best-selling car maker.

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Volkswagen and Tata Motors will set up a strategic partnership to help both companies boost economy car sales in India and emerging markets.

VW’s Skoda unit will lead the project to develop components and vehicles.

The German automaker is looking for new markets as it recovers from its diesel emissions scandal.

Tata Motors, which is India’s largest automaker and owns Jaguar Land Rover, is also hoping to claw back domestic market share.

VW and Tata have signed a memorandum of understanding on a partnership they hope will potentially lead to Tata Motors launching new vehicles by 2019.

Tata Motors CEO Guenter Butschek has put in place a restructuring program to help build up the company’s lost sales for passenger and commercial vehicles by improving efficiencies, cutting production delays and building economies of scale.

Guenter Butschek said: “We strongly believe that both the companies, by working together, can leverage from each other’s strengths to create synergies and develop smart innovative solutions for the Indian and overseas market.”

VW is investing in self-drive vehicles and greener technology such as electric cars and would like greater familiarity with the Indian market.

Volkswagen AG CEO Matthias Müller said: “By offering the appropriate products, we intend to achieve sustainable and profitable growth in very different parts of the world.”

A previous attempt by VW to expand into emerging markets through an alliance with Suzuki Motor Corp ended in 2015, following bitter disagreements.

Automakers are attempting to win a greater share of expanding emerging markets through the sale of budget cars, which in turn increase familiarity of their brand.

VW is still dealing with the aftermath of the company’s emissions-cheating scandal which came to light in September 2015.

It pleaded guilty to three criminal charges in the US in January 2017, and would pay fines totaling $4.3 billion to settle charges over the scandal.

In November 2016, VW announced plans to cut 30,000 jobs worldwide with about 23,000 of the losses to be borne in Germany.

 

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Car giant Volkswagen faces its first legal action in Germany from a big corporate client over the dieselgate scandal.

Deutsche See, which leases 500 vehicles from the German automaker, said it had been unable to reach an out-of-court settlement, Reuters reported.

VW is involved in numerous lawsuits from individual owners, regulators, states and dealers, many of them class-action cases in the US.

Deutsche See is one of Germany’s major fish and seafood producers.

The company promotes itself as environmentally friendly, and in 2010 won an award for being Germany’s “most sustainable company”.

It said in a statement: “Deutsche See only went into partnership with VW because VW promised the most environmentally friendly, sustainable mobility concept.”

According to German media, Deutsche See filed its complaint for “malicious deception” at the regional court in Braunschweig, near VW’s Wolfsburg headquarters.

On February 5, VW declined to comment on the reports.

It admitted in September 2015 that it had used software to cheat diesel-emissions tests in the US.

VW is now embroiled in investigations across the world, and will have to spend a huge amount of money to settle claims and put the engines right.

The cost of settlements and fines in the US alone are approaching $20 billion.

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VW has overtaken Toyota to become the world’s best-selling automaker.

This is the first time the German company has held the position.

Toyota, which had topped sales for the past four years, sold 10.175 million vehicles globally in 2016.

That fell short of the 10.31 million sales which VW reported last week.

The milestone comes despite Volkswagen’s scandal over emissions tests cheating, which sparked a global backlash and multiple lawsuits.

Volkswagen, which makes the Audi, Porsche and Skoda brands, saw a 3.8% increase in sales buoyed by demand in China.

Toyota’s sales grew by 0.2% – though it appears to have suffered from a slowdown in the US car industry.

GM reports its figures next week, but it is expected to lag both Toyota and VW.

General Motors was the world’s third-largest automaker in 2015. It held the number one title in 2011 after Toyota’s production was hit by a massive earthquake and tsunami in north-eastern Japan.

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German automaker Volkswagen has agreed a draft $4.3 billion settlement with the Department of Justice and US Customs over the emissions-rigging scandal.

VW also said it would plead guilty to breaking certain US laws.

The company said it was in advanced discussions with the DoJ and US Customs about the deal.

The final agreement has yet to be approved by VW’s management and supervisory board, which could happen later on January 11.

The company said it had negotiated a “concrete draft” of a settlement with US authorities that included criminal and civil fines totaling $4.3 billion, as well as appointing an independent monitor for the next three years.

The fine means that the total costs associated with the emissions cheating scandal are set to exceed the $19.2 billion VW has set aside to deal with the issue.

Volkswagen has already agreed to a $15 billion civil settlement with environmental authorities and car owners in the US.

The scandal erupted in September 2015 when the EPA found that many VW cars sold in America had a “defeat device” – or software – in diesel engines that could detect when they were being tested and adjust the performance accordingly to improve results.

VW subsequently admitted cheating emissions tests in the US and many countries throughout the world.

On January 9 it emerged that VW executives knew about emissions cheating two months before the scandal broke, but chose not to tell US regulators, according to court papers.

The executives involved include Oliver Schmidt, who was in charge of VW’s US environmental regulatory compliance office from 2012 until March 2015.

On January 9, Oliver Schmidt was charged with conspiracy to defraud and has been remanded ahead of a court appearance on January 12.

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For the first year in more than half a century, Volvo was not Sweden’s best-selling car in 2016.

Surprisingly the Volkswagen Golf topped sales, according to Sweden’s automakers’ association, although Volvo still had the largest share of the country’s car market overall.

VW Golf made up 5.9% of new cars bought in Sweden, while Volvo’s V70, S90 and V90 took 5.7% together.

Volvo was last knocked off top spot in 1962 by a Volkswagen Beetle.

Image source Wikimedia

Despite Volvo’s car business now being owned by a Chinese firm, Zhejiang Geely Holding Group, it is still viewed as an iconic Swedish brand.

Volvo still sells the most cars in Sweden, with more than one in five cars (21.5%) on the country’s roads, compared with VW’s 15.7%.

However, Volvo’s V70, the most popular car in Sweden for the past two decades, has ceased production in favor of the newer V90 model.

Sweden is Volvo’s second-biggest market after China.

The Swedish automakers’ association said 2016 saw record car sales with 372,000 new registrations, up by 8% on the 2015 figure, helped by a strong economy, while truck sales were up by more than 15%.

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VW reached a settlement with US and California authorities to recall 83,000 diesel cars with 3-liter diesel engines, resolving the last major part of its emissions cheating scandal.

The agreement, involving VW, Audi and Porsche cars, is another step towards allowing Volkswagen to put the emissions cheating scandal behind it.

In June the German auto maker agreed to a $15 billion settlement for another 475,000 vehicles affected by the scandal.

The Environmental Protection Agency (EPA) estimates that the total cost of the 3-liter settlement, including buybacks, repairs, and environmental remediation, at about $1 billion.

VW reached a $14.7 billion settlement with 550,000 owners of smaller, 2-liter diesel cars in September.

About one-quarter of the affected owners will be able to sell their vehicles back to VW at a price yet to be determined. The other 60,000 vehicles will be repaired at no cost to their owners, becoming fully compliant with clean-air laws.

US District Judge Charles Breyer said owners of the 3-liter cars made between 2009 and 2016 would get “substantial compensation” for having them fixed or repaired.

However, there were some remaining issues to be resolved and another hearing will be held on December 22, he said.

VW spokeswoman Jeannine Ginivan said the deal was “another important step forward in our efforts to make things right for our customers”.

The company admitted in September 2015 to installing secret software in 475,000 US 2-liter diesel cars to cheat exhaust emissions tests and make them appear cleaner in testing than they really were. They emitted up to 40 times the legally allowable pollution levels.

The $15 billion settlement in June covered those vehicles, including an offer to buy them all back.

The US Justice Department said VW had agreed to contribute another $225 million to a fund to offset excess diesel emissions.

In a separate filing, California’s government said VW would increase the number of electric vehicles it sells in the state.

Robert Bosch, the German engineering company that made the software for the VW diesels, has also agreed in principle to settle civil allegations at a cost of about $300 million.

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Volkswagen is being sued in Australia for allegedly misleading customers by selling modified vehicles that covered up emissions fraud.

The Australian Competition and Consumer Commission (ACCC) claims VW intentionally sold more than 57,000 such vehicles over a five-year period.

It is seeking a public declaration of misconduct, financial penalties and corrective advertising.

VW Australia said it is reviewing the ACCC claims.VW emissions scandal 2016

In a statement, the company said it does not think that the court action “provides any practical benefit to consumers because software solutions for cars affected by the voluntary recall are expected soon”.

Volkswagen Group Australia managing director Michael Bartsch said: “The best outcome for customers whose vehicle is affected is to have the voluntary recall service updates installed.”

The ACCC lawsuit covers 10 VW car models including the top-selling Golf, Passat and Polo,

ACCC chairman Rod Sims said in a statement: “These allegations involve extraordinary conduct of a serious and deliberate nature by a global corporation.

“We expect higher standards of behavior from all companies that supply to Australian consumers.”

The world’s second-biggest auto maker is also facing several private class action lawsuits in Australia.

VW has suffered a global backlash since revealing last year that around 11 million of its vehicles had software or so-called “defeat devices” designed to bypass official emissions tests.

The company has since had to pay billions of dollars in fines and settlements with both regulators and customers around the world.

Volkswagen has reportedly reached a $15 billion settlement with US car owners after admitting it cheated emission tests.

The German auto maker would offer to repair or buy back the affected diesel vehicles and pay owners compensation, according to sources close to the talks.

In 2015, US regulators discovered that VW cars were fitted with software that could distort emissions tests.

VW subsequently said 11 million cars were affected worldwide.

The US settlement is still pending approval by a judge, but it would be the largest car scandal settlement in the country’s history. The details are expected to be announced on June 28.VW CO2 issue 2015

According to news agencies, the legal settlement sets aside $10 billion to repair or buy back around 475,000 affected vehicles with 2-litre diesel engines, and to compensate owners with a payment of up to $10,000.

Car owners would still be able to decline the VW offer and sue the company on their own.

According to the sources quoted by news agencies, the deal also includes $2.7 billion in funds to offset excess diesel emissions and $2 billion for research into green energy and environment-friendly cars.

VW installed software in diesel engines to detect when they were being tested so the cars could cheat the results.

Some models could have been pumping out up to 40 times the legal limit of the pollutant, nitrogen oxide, regulators disclosed.

The company told its shareholders last year it had set aside $7.3 billion to help defray the potential costs of a recall or regulatory penalties.

That amount though might not be enough – VW faces as much as $20 billion in fines for Clean Air Act violations alone.

The increased emissions provision pushed VW to an annual pre-tax loss of €1.3 billion, compared with a profit of €14.7 billion the previous year.

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Volkswagen profit fell 20% in Q1 of 2016 as the auto maker continues to grapple with fallout from the diesel emissions scandal.

Pre-tax profit fell to €3.2 billion in Q1 of 2016, down from €3.97 billion in the same period a year ago.

VW CEO Matthias Muller said he was “satisfied” with the start of “what will undoubtedly be a demanding” 2016.

The German giant admitted last year that it installed software to cheat US emissions tests.

VW has already set aside more than €16 billion to pay for costs arising from the scandal.

The company has agreed a deal with the DoJ in which it will buy back and “substantially” compensate more than 500,000 American owners of its diesel cars affected by the emissions cheating. Final details are expected in June.VW CO2 issue 2015

“In the first quarter, we once again managed to limit the economic effects of the diesel issue and achieve respectable results under difficult conditions,” Matthias Muller added.

VW Group sales revenue fell 3.4% to €51 billion in the period.

Sales of VW-branded cars were particularly hard hit, with profit from that part of the business falling 83% to €73 million from €514in 2015.

VW maintained its forecast of a 5% fall in 2016 sales revenue compared with last year, “depending on economic conditions – particularly in South America and Russia – and exchange rate developments as well as against the backdrop of the diesel issue”.

However, the company predicted “a marked decrease in sales revenue” in 2016 for its passenger car brands, which include Audi, Seat and Skoda.

Matthias Muller said: “2016 will be a transitional year for Volkswagen… we remain confident that our operating business will again record solid growth this year.”

After publishing the profit report, VW shares fell 3% in Frankfurt to €133.57 and are down 40% over the past 12 months.

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Volkswagen is being sued by a Norwegian sovereign wealth fund over the car giant’s emissions scandal.

Norges Bank Investment Management, the world’s largest fund, said it had been advised by lawyers that VW’s conduct “gives rise to legal claims under German law”.

VW admitted last year that it had installed secret software to cheat US emissions tests.

The move, from one of VW’s biggest investors, is the latest in a flood of legal actions over the scandal.VW emissions scandal 2016

VW faces action from US Department of Justice, the Federal Trade Commission and its own dealers.

Norges Bank Investment Management is worth $850 billion (€751 billion) and has stakes in more than 9,000 companies.

According to the Financial Times, which first reported the story, the lawsuit is expected in the coming weeks. It will be filed in Germany, joining class-action cases which are being prepared there.

“Norges Bank Investment Management intends to join a legal action against Volkswagen arising out of [the fact that] the company provided incorrect emissions data,” the statement said.

“As an investor, it is our responsibility to safeguard the fund’s holding in Volkswagen.”

In April, VW reached a deal with US authorities in which it agreed to offered to buy-back almost half a million vehicles and provide money for a fund to help develop cleaner car technology.

Norges Bank Investment Management recently announced action to clamp down on excessive executive pay at the companies it invests in, as well as encouraging oil companies to report more on the risks of climate change.

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Volkswagen has announced it set aside more than double provisions for the diesel emissions scandal to €16.2 billion.

In 2015, VW told shareholders that €6.7 billion had been set aside for potential costs or recalls.

The increased sum included the cost of fixing cars that violate air pollution standards, buying back vehicles and legal costs.

The move comes as German carmakers agreed to recall 630,000 diesel vehicles to tweak engine software.

German transport minister Alexander Dobrindt said Mercedes Benz, Opel and Porsche as well as VW and Audi would adjust settings that increased levels of emissions such as nitrogen dioxide in some diesel cars.

Shares in Daimler fell 4.6% in Frankfurt after the Mercedes owner said it had begun an internal investigation into its diesel emissions testing at the request of the US Justice Department.VW buy back deal US

Daimler said net profit for Q1 of 2016 fell by a third to €1.4 billion, held back by costs associated with the launch of the new E-Class range. The bigger-than-expected decline came despite a 2% rise in revenue to €35 billion as sales rose 7% to 683,885 vehicles.

VW CEO Matthias Muller said he could not put a figure on the total cost of the emissions scandal until a final deal was reached with US authorities.

Nor could the company release preliminary findings from an investigation it commissioned from law firm Jones Day until reaching an agreement, it said.

VW still faced the DoJ fines as part of an expected civil settlement, as well as possible criminal charges.

On April 21, a US court disclosed details of a deal between VW and the DoJ for more than 500,000 American owners of its diesel cars affected by the emissions cheating.

The deal will involve buybacks and “substantial” compensation for owners of mostly two-liter vehicles.

The increased emissions provision pushed VW to an annual pre-tax loss of €1.3 billion, compared with a profit of €14.7 billion the previous year.

VW expected group sales to fall by up to 5% in 2016.

Chief financial officer Frank Witter said: “We are again operating in an exceedingly challenging environment in which global demand for new vehicles is declining, exchange rates and interest rates remain highly volatile and competition in many of our markets is intensifying.”

VW shares closed down 1.7% in Frankfurt on April 22 and are more than 40% lower than at this time last year.

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Volkswagen has reached a deal with the US authorities under which the automaker could offer to buy back up to 500,000 diesel cars in the US.

VW has also agreed a compensation fund for owners.

The German car giant is expected to reveal the deal to a Federal judge in San Francisco on April 21.

A VW spokeswoman, the Environmental Protection Agency (EPA) and the Justice Department declined to comment.

The company could also offer to repair diesel vehicles if US regulators approve a fix at a future date, reports said.VW buy back deal US

In March, US District Judge Charles Breyer gave VW until April 21 “to announce a concrete proposal for getting the polluting vehicles off the road.”

Judge Charles Breyer said in March the “proposal may include a vehicle buy back plan or a fix approved by the relevant regulators that allows the cars to remain on the road with certain modifications.”

In September 2015, the EPA found that VW cars being sold in the US had a “defeat device” – or software – in diesel engines that could detect when they were being tested, and change the performance to improve results.

Some models could be pumping out up to 40 times the legal limit of the pollutant nitrogen oxide.

In March, VW CEO Matthias Muller said that a deal with US authorities over its emissions scandal could take longer and cost more than expected.

Matthias Muller warned that the €6.7 billion set aside to cover the costs of the scandal might not be enough.

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Skoda has posted its best first quarter to date as it shrugged off the emissions scandal hanging over parent company Volkswagen.

The Czech automaker sold 276,600 cars in Q1 of 2016, rising 4.3% on the same period of 2015.Skoda record sales 2016

Skoda sales director Werner Eichhorn said growth in China and Europe contributed to the strongest start in the company’s 121-year history.

However, Werner Eichorn said sales in some markets, particularly Russia, remained “tense”.

Sales of Skoda cars dropped in some markets in 2015 amid a controversy over the level of emissions from VW’s diesel and petrol cars.

In September 2015, Skoda said 1.2 million of its cars were fitted with the software that allowed VW to cheat US emissions tests.

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VW’s recall plan for diesel cars equipped with emissions “cheat” devices has been rejected by US regulators.

The California Air Resources Board (CARB) said VW’s proposals did “not adequately address overall impacts on vehicle performance, emissions and safety”.

The CARB also said the proposed fix was not fast enough.

It said it would continue its investigation as well as talks with VW to find a suitable solution.

The head of the CARB, Mary Nichols, said: “Volkswagen made a decision to cheat on emissions tests and then tried to cover it up.

“They continued and compounded the lie and when they were caught they tried to deny it. The result is thousands of tons of nitrogen oxide that have harmed the health of Californians. They need to make it right.”EPA rejects VW recall plans

The federal Environmental Protection Agency (EPA) also said the VW plan for cars with 2 liter diesel engines was not acceptable.

The rejection comes ahead of a meeting between VW CEO Matthias Muller and EPA chief Gina McCarthy on January 13 to discuss the emissions scandal.

Volkswagen said in response: “Today’s announcement addresses the initial recall plans Volkswagen submitted to CARB in December. We are committed to working co-operatively with CARB and other regulators, and we plan to continue our discussions tomorrow when we meet with the EPA.”

The issue affects almost 600,000 cars in the United States and up to 11 million worldwide.

The scandal has severely damaged VW’s reputation and sparked investigations in several countries.

In the US alone VW is facing fines that could run into tens of billions of dollars.

The Department of Justice is suing Volkswagen on behalf of the EPA with a lawsuit that was filed on January 4 in a federal court in Detroit, Michigan.

The DoJ said the filing was the first step in “bringing Volkswagen to justice”.

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Volkswagen has reported its first drop in VW brand sales in 11 years as the company continues to cope with its emissions scandal.

The VW brand sales fell 4.8% in 2015 to 5.82 million cars from 6.12 million a year earlier.

Falling demand in China and US added to the losses as orders fell in December.

VW has promised it will have a fix in the coming weeks for the millions of US cars with defeat devices that disguised emission levels in diesel cars.

Sales began declining after the emissions scandal came to light in September 2015. Deliveries fell 5.3% in October, 2.4% in November and 7.9% in December compared with those months the previous year.

The underperformance at VW’s largest division by sales and revenue pulled down annual group deliveries by 2% to 9.93 million cars, the first drop in 13 years, VW said.VW sales 2015

Speaking on January 6, Volkswagen chief executive Herbert Diess said he was “optimistic” the company would find a solution soon.

“We will bring a package together which satisfies our customers first and foremost and then also the regulators,” he said.

Regulators appear been less confident. The Environmental Protection Agency (EPA) which uncovered the scandal, said on January 4 that VW had not yet “not produced an acceptable way forward”.

VW will meet the EPA in Washington next week to discuss its plan.

On January 4, the Department of Justice filed a lawsuit against VW for the use of the emissions devices, which involve computer software that can detect when cars are being tested.

The Connecticut Attorney General George Jepsen said on January 8 that the company was not cooperating with the investigation.

VW has been withholding corporate emails between executive related to the emissions scandal, using German law as the basis for the refusal.

“I find it frustrating that, despite public statements professing cooperation and an expressed desire to resolve the various investigations that it faces following its calculated deception, Volkswagen is, in fact, resisting cooperation by citing German law,” George Jepsen said in a statement.

In 2015, a record 17.47 million cars were sold, according to Autodata. The car data company has been keeping records since 1980.

General Motors, one of the biggest US automakers, had an 8% increase in sales.

Mercedes-Benz USA had its most successful year since entering the country, with sales rising 3.8%.

VW has been sued by the US Justice Department over the emissions scandal that saw the German automaker fitting software in millions of cars to cheat emissions tests.

In September 2015, following an investigation by the US Environmental Protection Agency (EPA), VW admitted fitting the so-called defeat device on 11 million cars globally.

The emissions scandal has hit Volkswagen sales worldwide.

The German car giant has put aside billions of euros to deal with the fallout.

The lawsuit, on behalf of the EPA was filed on January 4 in a federal court in Detroit, Michigan.

“The complaint alleges that nearly 600,000 diesel engine vehicles had illegal defeat devices installed that impair their emission control systems and cause emissions to exceed EPA’s standards, resulting in harmful air pollution,” the filing said.VW sued by Department of Justice

It also alleges that VW “violated” clean air laws by selling cars that were different in design from those originally cleared for sale by the EPA.

“With today’s filing, we take an important step to protect public health by seeking to hold Volkswagen accountable for any unlawful air pollution, setting us on a path to resolution,” said assistant administrator Cynthia Giles for the EPA’s Office of Enforcement and Compliance Assurance.

“So far, recall discussions with the company have not produced an acceptable way forward. These discussions will continue in parallel with the federal court action.”

The department said the filing was just the first step in “bringing Volkswagen to justice”.

VW is also facing separate criminal charges, and a raft of class-action lawsuits filed by car owners.

The EPA says that VW fitted many of its cars with a device that was able to recognize test conditions and adjust the engine settings accordingly, with the express purpose of giving distorted readings on nitrogen oxide emissions.

VW admitted to “totally screwing up”, and there has been a shake-up in the management structure and personnel as a result. Martin Winterkorn resigned as CEO and was replaced with Matthias Muller, the former boss of Porsche.

The company is currently conducting an internal investigation that it says will “leave no stone unturned”.

VW will begin recalling millions of cars worldwide soon, and has set aside €6.7 billion to cover costs. That resulted in the company posting its first quarterly loss for 15 years, of €2.5 billion in October 2015.

With the lawsuits piling up, experts say the final costs for VW are likely to be much higher than that.

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VW global sales fell 2.4% in November 2015 following the emissions scandal, the German automaker announced on December 10.

The total for the 11 months of 2015 was down 4.5% compared with 2014.

The annual tally was likely to fall short of last year’s total as a result.

VW-brand board member Jurgen Stackmann said: “In view of the current challenging situation, I don’t believe VW will be able to make up the gap in the remaining days of the year.”

Volkswagen said it sold 496,100 VW-brand cars worldwide in November.VW sales November 2015

Sales plunged in Brazil, with a 51.4% fall, and slid by 31.8% in Russia, although economic problems in both countries were largely to blame for those declines rather than the emissions scandal.

The VW brand delivered 6.12 million cars in total in 2014.

The automaker said last week that US sales fell 24.7% in November compared with the same month last year.

Volkswagen group chairman Hans Dieter Potsch said on December 10 that a “chain of errors” led to the emissions scandal and that the entire company was now focused on regaining the trust of customers.

In September, US regulators found that some VW diesel cars had a “defeat device” – or software – to cheat emissions tests.

VW said the situation arose when it decided to launch a large-scale promotion of diesel vehicles in the US in 2005, but found it impossible to meet strict emissions limits in force in that country in time.

Hand Dieter Potsch said: “No business justifies crossing legal and ethical boundaries.”

VW CEO Matthias Muller said he was confident that customers would overcome their reluctance to buy the group’s vehicles in the coming weeks.

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VW chairman of the board of directors Hans Dieter Potsch says a chain of errors led to the emissions scandal and that its top priority is winning back trust.

Speaking at a news conference, Hans Dieter Potsch said: “We are talking here not about a one-off mistake but a chain of errors.”

He said Volkswagen would be “relentless in seeking to establish who was responsible” for the scandal.

VW CEO Matthias Muller said it was “fighting for every customer”.

However, he said a massive slump in sales had not occurred in the wake of the scandal.Hans Dieter Potsch and Matthias Muller press conference

In September, US regulators found some VW diesel cars had a “defeat device” – or software – to cheat emissions tests.

The automaker said the problem began when it decided to launch a large-scale promotion of diesel vehicles in the US in 2005, but found it impossible to meet strict emissions limits in force in that country in time.

VW said it had agreed steps to improve supervision of engine software development to prevent future manipulation.

Matthias Mueller said it was relatively simple and inexpensive to fix the millions of affected cars, but this had not been possible before, as the technology for the fixes was not available when the cars were built. In any case, the company was unaware at the time that there was a problem.

VW will in future undertake “real-life” tests, which will be checked by both internal and external third parties.

Hans Dieter Potsch said: “No business justifies crossing legal and ethical boundaries.”

He said it was likely that only a limited number of people took part in the deception and said they would not be named as yet, adding that it was impossible to stop misconduct by individuals.

However, he added that the actions taken by the company would make such actions that much more difficult in future.

Law firm Jones Day is conducting an investigation into what happened. That, Hans Dieter Potsch said, was making good progress, but would take some time to conclude.

The cheat device affects up to 11 million VW cars worldwide.

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VW has said that far fewer of its cars are affected by inaccurate carbon dioxide emissions and fuel usage measurement than it originally thought.

The automaker now estimates that about 36,000 of the cars it produces each year are affected.

Last month, Volkswagen said an internal investigation suggested that CO2 emissions and fuel consumption had been understated for 800,000 vehicles.

It warned at the time that the problem could cost it about €2 billion.VW CO2 issue 2015

“Following extensive internal investigations and measurement checks, it is now clear that almost all of these model variants do correspond to the CO2 figures originally determined.

“This means that these vehicles can be marketed and sold without any limitations,” VW said in a statement.

The company suggested its findings meant that the charge was now likely to be lower.

“The negative impact on earnings of €2bn that was originally expected has not been confirmed. Whether we will have a minor economic impact, depends on the results of the re-measurement exercise,” it added.

VW has already put aside €6.7 billion to meet the cost of recalling 11 million diesel vehicles worldwide that were fitted with so called “defeat devices” that circumvented tests for emissions of nitrogen oxides.

The scandal was revealed in September by US regulators, who said the software detected when vehicles were undergoing emissions tests and changed the way they operated.

Investors, who had feared that the CO2 problem could be as large as its “defeat devices” scandal, were clearly relieved by the statement.

VW’s shares, which have fallen almost 30% this year, rose almost 5% after the statement.

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According to Germany’s transport minister, around 98,000 VW petrol vehicles are caught up in the automaker’s latest emissions scandal.

That follows an admission by VW that it had found “irregularities” in CO2 emissions levels that could affect 800,000 vehicles.

It came to light as a result of an internal investigation by the firm following the diesel emissions scandal.

On November 3, VW admitted that an internal investigation had revealed that carbon dioxide emissions and fuel consumption were understated during standards tests on about 800,000 cars.

The company said the issue mainly affected diesel cars.VW petrol cars CO2 emissions

However, on November 4, Germany’s Transport Minister Alexander Dobrindt told the country’s parliament: “Today we were told that among the affected vehicles are 98,000 petrol vehicles”.

VW, Skoda, Audi and Seat vehicles could be affected and the company estimates the CO2 problem could cost it about €2 billion.

Volkswagen had already set aside €6.7 billion to meet the cost of the initial emissions scandal.

News of the issue with CO2 emissions sent VW shares down by 5.6% on November 4.

The company’s shares have lost about a third of their value since September, when the scandal first broke.

It came to light after the US Environmental Protection Agency (EPA) found VW software had detected when vehicles were undergoing emissions tests, and altered the way they operated to give more favorable results.

On November 2, the EPA also alleged that VW had fitted nitrogen oxide defeat devices on 3.0 liter diesel engines used in Porsche, Audi and VW vehicles – a claim VW denied.

Porsche also denied the allegations, but its North American division announced it is discontinuing sales of Porsche Cayenne diesel sport utility vehicles until further notice.

The carmaker is recalling 11 million diesel vehicles worldwide that were fitted with the software that circumvented tests for emissions of nitrogen oxide.

That recall is for cars with variants of the EA 189 diesel engine built to the “Euro 5” emissions standard.

Meanwhile, VW is recalling 92,000 cars in the US over a mechanical problem that could affect vehicles’ brakes.

The German carmaker said part of the camshaft could shear off, causing loss of vacuum in the power brakes, which could lengthen stopping distances.

Today’s recall includes Beetle, Golf, Jetta and Passat models from 2015 and 2016. The cars have 1.8 liter and 2 liter turbocharged petrol engines.

VW discovered the problem after getting reports of camshaft failures. A fix is expected by the end of March.

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According to the Environmental Protection Agency (EPA), VW cars with bigger diesel engines also contained software devices designed to cheat in emissions tests.

Porsche, Audi and VW cars are all included in this new investigation, which affects at least 10,000 vehicles.

The EPA said that cars with 3.0 liter engines from the years 2014 to 2016 were affected.

However, VW denies the vehicles have software designed to cheat tests.

Instead the automaker says that cars with the 3.0 liter diesel V6 engines “had a software function which had not been adequately described in the application process”.

VW said it was cooperating with the EPA to “clarify the matter”.

“Volkswagen AG wishes to emphasize that no software has been installed in the 3-liter V6 diesel power units to alter emissions characteristics in a forbidden manner,” the company said in a statement.

Meanwhile, Porsche said it was “surprised” by the EPA’s allegations.

Photo Reuters

Photo Reuters

“Until this notice, all of our information was that the Porsche Cayenne diesel is fully compliant,” it said in a statement.

The EPA says the investigation is ongoing.

“VW has once again failed its obligation to comply with the law that protects clean air for all Americans,” said Cynthia Giles, assistant administrator at the EPA’s enforcement unit.

The EPA identified these diesel models as containing software aimed at cheating tests: 2014 VW Touareg; 2015 Porsche Cayenne; 2016 Audi A6 Quattro, A7 Quattro, A8, A8L and Q5.

In early September, VW admitted to the EPA that cars from the model years 2009 to 2015 contained software designed to cheat emissions tests.

It said that 11 million cars were affected.

That prompted US regulators to run further tests designed to detect such defeat devices and led to today’s announcement from the EPA.

“These tests have raised serious concerns about the presence of defeat devices on additional VW, Audi and Porsche vehicles. Today we are requiring VW Group to address these issues. This is a very serious public health matter,” Cynthia Giles said.

Regulators all over the world are now looking at VW’s diesel cars and the company is also facing criminal investigations.

State and federal prosecutors in the US have announced criminal investigations and German prosecutors are looking into the scandal.

VW CEO Martin Winterkorn resigned in late September as the scale of the scandal emerged.

At the time Martin Winterkorn said he was “not aware of any wrongdoing on my part” but was acting in the interest of the company.

Last month Volkswagen reported its first quarterly loss for at least 15 years after taking a big charge to cover the costs of the scandal.

VW said it had set aside €6.7 billion ($7.4 billion) to cover costs related to emissions cheating, which left it with a €2.52 billion pre-tax loss for the third quarter of the year.

Many analysts expect that VW will have to set aside more money to cover the recall of cars, penalties and lawsuits.