VW diesel scandal: costs rising, European cars need hardware modifications image

Volkswagen Ag, the largest European automaker, announced recently around three million autos across Europe equipped with the 1.6 liter diesel engines will need a time-consuming hardware modification.

The models have been affected by the company’s diesel emissions scandal, which was triggered last month by the EPA’s discovery the automaker was rigging diesel emissions tests. The German carmaker admitted to the illegal action and also said up to 11 million vehicles worldwide were actually fitted with the illegal software, including 8.5 million in Europe and almost half a million in the US, with the shenanigans starting back in 2009. The admission triggered the largest business crisis in the company’s 78-year history and now the company prepares to recall all the affected cars to make them compliant with pollution regulations. The bigger engines would only need a software update for the fix to work but the smaller engine will need technology adaptations.

Volkswagen’s new chief executive officer Matthias Mueller also announced the company might need to set aside more money, besides the 6.5 billion euros ($7.4 billion) it has already provisioned to cover the costs of the emissions scandal. “The 6.5 billion (euros) applies to the recall,” commented Mueller at the VW headquarters in the German town of Wolfsburg.
“I can only speculate about any further provisions. Should there be a change in sales volumes, we would react rapidly.” Volkswagen also confirmed it had stopped the sale in Europe of Euro 5 compliant models with the engines using the illegal software – these are few as most of the model line is now up to the Euro 6 standard.

Via Reuters