Ex-Volkswagen CEO facing criminal probe

Source: Sean Reilly, E&E reporter • Posted: Tuesday, September 29, 2015

German prosecutors have opened a preliminary investigation into any role that Martin Winterkorn, former chief executive officer of Volkswagen AG, may have had in an emissions cheating scheme affecting millions of diesel-powered vehicles.

The inquiry will focus on who bears responsibility for rigging the cars to evade testing requirements, according to a news release today from the prosecutor’s office in the central German city of Braunschweig, not far from Volkswagen AG’s corporate headquarters in Wolfsburg.

While VW’s board had said last week that it was voluntarily requesting an investigation, Julia Meyer, a spokeswoman for the prosecutor’s office, told the Associated Press that about a dozen complaints had been received in all. She would not predict how long the probe might last.

Winterkorn resigned Wednesday, five days after U.S. EPA and California state regulators accused the automaker of installing software on almost a half-million VW and Audi cars that applied full emissions controls when the vehicles were being tested but otherwise left them free to spew nitrogen oxides at up to 40 times the allowable levels.

In his resignation statement, Winterkorn, who had headed the Volkswagen Group since 2007, said he knew of no wrongdoing on his part but accepted responsibility for the “irregularities” (Greenwire, Sept. 23).

The company, which on Friday named Matthias Mueller, chairman of its Porsche unit, as Winterkorn’s replacement, had no immediate comment today on the news of the investigation.

Worldwide, the scam affects some 11 million vehicles, the company has said. In the United States alone, VW could face up to $18 billion in fines. In a sign that the fallout is spreading throughout the industry, EPA managers Friday warned all automakers that their cars could be tested under real-world driving conditions for the “defeat devices” (Greenwire, Sept. 25).

But the episode is also giving fresh wind to EPA critics who see the existing testing framework as overly deferential to car and truck manufactures. Volkswagen’s deception, which has been going on for years, was uncovered by West Virginia University researchers working for the International Council on Clean Transportation, an independent nonprofit.

In a news release today, Public Employees for Environmental Responsibility (PEER), a watchdog organization, accused EPA of failing to use actual “on the road” emissions data collected from diesel vehicles to monitor either emissions or fuel efficiency.

Currently, testing is conducted “by putting the vehicle on a dynamometer — essentially a big treadmill,” PEER said in the release. When heavy-duty diesel engine manufacturers in the late 1990s were found to have resorted to the same type of manipulation used by Volkswagen, they instead agreed to “in-use” testing to show compliance, the group said.

But EPA has refused to make the data from that testing program public on the grounds that it is “confidential business information,” the group said, and has also invested $50 million in a new chassis dynamometer for light-duty vehicles to be rolled out next month.

The Volkswagen scandal shows that dynamometer technology “is a dinosaur, yet EPA [keeps] pouring money into it,” Jeff Ruch, PEER’s executive director, said in the release. “The fact that the VW cheating was revealed by outsiders indicates the clubby and closed manner in which this arm of EPA operates.”

In an emailed response, EPA spokesman Nick Conger called many of PEER’s points “simply wrong.” The agency uses a wide range of tools besides dynamometers “that are all critical to the … overall compliance program,” Conger said. They include on-road testing, audits of industry emissions testing labs and “selective enforcement” reviews where vehicles and engines are pulled at random from an assembly line and tested. EPA also “continually updates its oversight strategies, and adapts when we learn of ways that manufacturers can game the system,” Conger said. “That is part of any oversight effort.”