UPDATE: Volkswagen CEO Martin Winterkorn has publicly apologised for the German automaker's alleged use of emissions test-cheating software. Click here for more.
Volkswagen has been accused of installing software in its new cars, designed to escape the watchful eye of environmental law-enforcers in the US.
It’s alleged the carmaker designed the software to detect and respond to official emissions testing in order to supply the lowest possible reading, before resorting to a ‘normal’ mode during regular driving.
Under normal mode, emissions are said to be up to 40 times higher than permissible levels.
The models in question were built and sold between 2009 and this year, and all of them are powered by diesel engines.
While some carmakers have chosen downsized turbocharged petrol engines or hybrid powerplants to bring their average fuel consumption down across their fleets, Volkswagen has championed the fuel-efficient diesel engine.
As a result, the German carmaker is now the biggest seller of diesels in the US market, and almost half a million cars are under the spotlight following the allegations.
America’s Environmental Protection Agency (EPA) called the software a “defeat device”.
“These violations are very serious, not only because illegal defeat devices results in excess emissions many times the allowable standard, but also because Volkswagen was concealing the facts from EPA, the state of California and consumers,” EPA’s Cynthia Giles said, speaking with industry paper Automotive News.
“We expected better from Volkswagen.”
Investigations are continuing, and Volkswagen said it will cooperate with authorities. But if Volkswagen is found to have operated outside regulations, a maximum fine of US$37,500 per vehicle could result in a total fine of US$18 billion (AU$25 billion).
Such a large fine is unlikely, however, as a consolidated fine would be more in line with previous cases of this nature.
No recall has been issued at this stage, but an enforced recall is not out of the question. Also possible is a compensation scheme, which would see owners receiving payments from Volkswagen for being ‘misled’ at the time of purchase.
Ford, Hyundai and Kia have all compensated owners in the past upon admitting official fuel consumption figures for some models were exaggerated, and Volkswagen could face a similar class action.
Ratings and recommendations from the EPA and the influential Consumer Reports magazine for Volkswagen’s 2016 model-year vehicles in the US are ‘on hold’ while investigations are underway.
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