VW faces up to $18.1 billion in fines for possible Clean Air Act violations

VW faces up to $18.1 billion in fines for possible Clean Air Act violations

US EPA, California allege cheat devices in 488,000 diesel cars since 2009.

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September 21, 2015

Washington, D.C. – Volkswagen faces as much as $18.1 billion in fines for potential violations of the Clean Air Act in its diesel vehicles by allegedly installing equipment to trick laboratory tests into thinking that vehicles were compliant.

The EPA notice of violation (NOV) alleges that 4-cylinder Volkswagen and Audi diesel cars from model years 2009-2015 include software that circumvents EPA emissions standards for certain air pollutants. California is separately issuing an In-Use Compliance letter to Volkswagen, and EPA and the California Air Resources Board (CARB) have both initiated investigations based on Volkswagen’s alleged actions.

“Using a defeat device in cars to evade clean air standards is illegal and a threat to public health,” says Cynthia Giles, assistant administrator for the Office of Enforcement and Compliance Assurance. “Working closely with the California Air Resources Board, EPA is committed to making sure that all automakers play by the same rules. EPA will continue to investigate these very serious matters.”

The Clean Air Act contains serious penalties for violations – up to $37,500 per non-compliant vehicle. The agency says VW violated the act for 488,000 models on the road, so the maximum fine comes out to $18.075 billion.

Volkswagen officials did not respond to requests for comment. Added 8:59 a.m. Monday, Sept. 21. Late Sunday, Volkswagen CEO Martin Winterkorn addressed the allegations.

"I personally am deeply sorry that we have broken the trust of our customers and the public," Winterkorn says. "We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case. Volkswagen has ordered an external investigation of this matter."

He adds, "The trust of our customers and the public is and continues to be our most important asset. We at Volkswagen will do everything that must be done in order to re-establish the trust that so many people have placed in us, and we will do everything necessary in order to reverse the damage this has caused. This matter has first priority for me, personally, and for our entire board of management."

In the California and EPA filings, regulators say they had concerns about nitrogen oxides (NOx) emissions from VW’s diesels after a study by West Virginia’s Center for Alternative Fuels, Engines, and Emissions published a report showing much higher real-world emissions from the diesels than lab testing would have indicated. Regulators met with VW officials who blamed the discrepancy on software flaws.

VW issued a recall to update emissions software last December, but regulators say the updated systems produced only margins cuts in NOx output. The vehicles were still emitted 10x to 40x more NOx (depending on driving conditions) than the Clean Air Act allows.

EPA officials say in September, when it became clear that the agency wasn’t going clear 2016 diesel models for sale, “Only then did VW admit it had designed and installed a defeat device in these vehicles in the form of a sophisticated software algorithm that detected when a vehicle was undergoing emissions testing.”

“Working with U.S. EPA, we are taking this important step to protect public health thanks to the dogged investigations by our laboratory scientists and staff,” says CARB Executive Officer Richard Corey. “Our goal now is to ensure that the affected cars are brought into compliance, to dig more deeply into the extent and implications of Volkswagen’s efforts to cheat on clean air rules, and to take appropriate further action.”

According to the NOV, the VW diesels only turn full emissions controls on during tests. Pollution emissions control device performance is greatly reduced during all normal driving situations.

NOx pollution contributes to nitrogen dioxide, ground-level ozone, and fine particulate matter. Exposure to these pollutants has been linked with a range of serious health effects, including increased asthma attacks and other respiratory illnesses that can be serious enough to send people to the hospital. Exposure to ozone and particulate matter have also been associated with premature death due to respiratory-related or cardiovascular-related effects. Children, the elderly, and people with pre-existing respiratory disease are particularly at risk for health effects of these pollutants.

Affected diesel models include:

  • Jetta (Model Years 2009 – 2015)
  • Beetle (Model Years 2009 – 2015)
  • Audi A3 (Model Years 2009 – 2015)
  • Golf (Model Years 2009 – 2015)
  • Passat (Model Years 2014-2015)

Regulators say they will work with VW to determine a solution to the problems.

Source: EPA, CARB