VOLKSWAGEN GROUP UNITED KINGDOM LTD
YOUR REFERENCE
Louise Ellman MP
Chair of the Transport Committee
Transport Committee
House of Commons
2nd Floor
14 Tothill Street
London SW1H 9NB
OUR REFERENCE
01908 601789
01908 601295
[email protected]
21 December 2015
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Dear Ms Ellman
Response to the Transport Committee Questions
VOLKSWAGEN GROUP
I write further to your letter dated 7 December 2015, and also my letter dated 1O
December 2015.
YEOMANS DRIVE
UNITED KINGDOU, LIMITfD
I have enclosed responses to the further questions that you have posed.
BLAKELANDS
f,11LTON Kl:YNES
t,'\Kl4 SAN
I very much hope that the Committee welcomed the news announced in respect
of the potential C02 issue as relayed in my letter dated 10 December. We are
aware that, as a result of those announcements, circumstances have somewhat
overtaken the questions that you asked in advance of that statement.
Nonetheless, we have sought to answer your questions 8(A) to (I) as best we
are able, given how much the situation has changed.
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REGISlERED OFFICE AS ABOVE
REGISTERED IN ENGLAND
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In relation to the NOx issue, as I previously informed you, information has now
been published regarding the findings of the Volkswagen's Group's audit
function in relation to how these issues arose (please see the enclosed press
release of 10 December, enclosed again for ease of reference). I am informed
that measures in respect of internal compliance structures are already being
implemented in order to address those findings.
In addition, the German federal motor and transport authority (Kraftfahrt­
Bundesamt, the "KBA") has now confirmed the technical measures that were
presented to them by the Volkswagen Group. The Group's focus will now turn
to ensuring that those confirmed measures do not have negative impacts upon
the vehicles' performance when they are implemented. Genuine progress is
clearly being made, which is excellent news for Volkswagen's customers in the
UK.
her details in relation to those issues, and on the other issues about which
sked, are detailed in the enclosed responses.
You
sincerely
A \VHOLLY OVINED SUBSIDIARY
OF VOLKSWAGEN AG
RESPONSE TO TRANSPORT COMMITTEE QUESTIONS 1.
PLEASE COULD YOU PROVIDE VOLKSWAGEN GROUP'S POSITION ON WHAT
THE SOFTWARE WAS DESIGNED TO DO AND WHY THERE [IS] A DISPUTE OVER
WHETHER OR NOT IT CONSTITUTES A 'DEFEAT DEVICE' AS DEFINED BY REGULATION
715/2007/EC?
1.1
We accept that software was fitted that enabled the vehicle to recognise that it
was undergoing testing and which changed the NOx emission characteristics in that
testing. We sincerely apologise for that.
1.2
Detailed investigations into what the software was designed to do, and why,
are however still continuing. Approximately 450 external and internal individuals are
involved in those ongoing investigations, with Jones Day's investigation being
expected to continue well into next year. As we previously infonned the Committee,
Jones Day have a very significant amount of information to review. At present, 102
terabytes of information has been secured (approximately equivalent to the amount of
information contained in 50 million books) with more than 1,500 electronic data
storage units (laptops, tablets etc.) having been secured from approximately 380
employees. Clearly it is very imp01iant to establish what happened and why.
1.3
Volkswagen accepts that a defeat device was used in the USA in certain
models, in the context of the ve1y different regulatory framework and factual
circumstances there. However, we do not think that it is possible to make the same
definitive legal dete1mination in relation to the software that was fitted to those
differently configured vehicles in the UK and the EU. Given that there is the potential
for this to be an issue that is examined in litigation, both in the English comis and
elsewhere, and fmiher given that Volkswagen is not taking this point to delay or
withhold implementing any of the technical measures as soon as possible, regrettably
we are unable to provide any fmiher (potentially legally privileged) details in relation
to our legal views on this issue.
1.4
Our number one priority is directing our efforts toward developing appropriate
technical measures and making sure that they can be implemented in the affected
vehicles as quickly as possible, whilst causing minimum inconvenience to om·
customers, irrespective of how the software is classified. We are not using the issue of
whether or not the software amounted to a defeat device as a means of delaying taking
the appropriate action. All of the affected vehicles will have the technical measures·
implemented.
2.
WITHOUT THE 'DEFEAT DEVICE' SOFTWARE WOULD THE VEHICLES MEET THE EUROPEAN TYPE APPROVAL LEGAL LIMITS ON NOx? 2.1
As above, in answering this question, we refer to om· response to question one
above.
2.2
In very simple terms, the software did amend the NOx characteristics in
testing. The vehicles did meet EU5 standards, so it clearly contributed to meeting the
EU5 standards in testing.
2.3
Volkswagen obtained type approval for all of its vehicles in the EU, and these
type approvals remain valid. However, if Volkswagen had not implemented this
pmticular software programme, it would have had to substitute it for another
programme, as it is necessary to recognise that the vehicle is in testing (as is common
across the industry). It would then in turn have to have met the EU5 standards
necessary for it to be sold. If you simply deleted this particular software programme
(without amending anything else), the vehicle would not function. Therefore this
question is not capable of being answered in the way that is asked.
2.4
Following the implementation of the technical measures, which will be
approved by the relevant authorities, we can confinn that the affected vehicles will
meet the European type approval legal limits on NOx in laboratory testing. The
affected vehicles will be capable of complying with the testing limits for NOx during
testing in a manner that is fully approved by the relevant regulatory authorities.
3.
FOR WHAT PURPOSE ARE YOU REMOVING SOFTWARE FROM AFFECTED
VEHICLES?
3.1
We recognise that we let our customers down and that the use of the software
in such a manner to affect the NOx emissions characteristics in testing was
inappropriate, and not what our customers or regulators would expect. We want to
implement the technical measures to remove any question or concern over how the
vehicles met the EU5 testing standard for NOx emissions. In any event,
notwithstanding our approach, the KBA is of the view that the operation of the
software fits the legal definition of a defeat device and has required us to implement
technical measures as a consequence.
The technical measures, which will include updating the software on all three
3.2
EA 189 engines of the size affected, will ensure that the vehicles meet the legal testing
limits for NOx in laboratory testing. Those updates will only be implemented once
they have been finally approved by the relevant regulatory authorities.
At the same time, the technical measures allow the Volkswagen Group to
3.3
introduce and take advantage of the benefits of all of the subsequent advances in
diesel engine technology and, indeed, in advances in NOx emissions testing
developed since these affected older models were originally produced. Since that
time, there have been considerable advances in the technology and learning
concerning "after treatment" systems and how to optimise their operation, controlled
legitimately by the engine software. Volkswagen will be able to introduce this
improved technology and learning into the 1.2 million affected vehicles. This will
likely improve NOx levels. We also refer you to the responses provided to the
Environmental Audit Committee on 8 December 2015 (enclosed) for ftuther
information in that regard.
4.
PLEASE PROVIDE THE COMMITTEE WITH THE LATEST INFORMATION ON THE
TECHNICAL FIX FOR EA189 ENGINES?
4.1
We can confam that installation of the technical measures will:
(a)
be carried out free of charge.
(b)
take less than one hour (and for the l.2L and 2.0L engines, approximately 30
minutes). That timing includes the l.6L engines, which require the installation of
additional hardware (a flow transformer) as well as a software update.
(c)
statt to be implemented in early 2016.
(d)
seek to encourage customer uptake, by being capable of being scheduled as
part of the owners' annual Volkswagen service or as a separate service (at the
customers' discretion).
4.2
As we previously informed the Committee, the technical measures for the l .2L
and 2.0L engines will be a software update. For the l .6L engines, a software update
will take place in conjunction with the installation of new hardware in the form of a
flow transformer. That flow transformer will be fitted directly in front of the air mass
sensor on the engine. In very simple tetms, a flow transformer is a mesh that calms
the swirled air flow in front of the engine's air mass sensor, thereby improving the
measuring accuracy of the air mass sensor. The air mass sensor determines the cmTent
air mass throughput, which is an imp01tant parameter for the engine's management in
terms of ensuring that an optimum combustion process is occurring.
4.3
We can also confirm that the Volkswagen Group in the UK is looking at a
range of options to minimise customer inconvenience. Those options are dependent
on the specific technical measures implemented, but are very likely to include a range
of mobility options, free of charge, where appropriate. Further details are also
provided in our response to the Environmental Audit Committee's questions
(enclosed) as pa1t of our fifth response.
4.4
Customers have been contacted by letter during the week ending 18 December
2015 to update them on these matters.
5.
FOR EACH AFFECTED VEHICLE MODEL PLEASE EXPLAIN THE IMPACT OF THE
TECHNICAL FIX ON VEHICLE PERFORMANCE, AND IN PARTICULAR FUEL ECONOMY.
PLEASE ALSO EXPLAIN WHAT TESTING VOLKSWAGEN GROUP HAS DONE TO
DETERMINE THE IMPACT OF THE TECHNICAL FIX?
5.1
Our goal remains that the technical measures implemented in the affected
vehicles will not impact vehicle performance or fuel economy. This takes some time
to develop, and you will recall that there are many model variants with different
transmissions. Each has its own software programme which needs to be
reprogrammed and have its own specific measures designed, approved and then
tested.
5.2
Whilst the KBA has now confumed our proposed technical measures for all
three engine types, the Volkswagen Group is now working to finalise the technical
measures and obtain final approval from the authorities. Each individual concept is
tested by the Quality Assurance Department, through a series of tests, which takes six
weeks (and ten weeks if there are hardware modifications). The concepts are tested,
including for C02 emissions and fuel economy values, in different conditions and
different altitudes. It is a comprehensive testing process which is common across the
industry.
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5.3
Implementation of the technical measures has yet to commence, although we
are optimistic based on the testing that the performance and fuel economy will not be
adversely affected. The testing is undertaken in line with the type approval process.
We will be closely monitoring both metrics when implementation commences to
ensure that our anticipation matches the eventual results, and we will be transparent
about those results.
6.
WHAT TESTING HAS THE VOLKSWAGEN GROUP UNDERTAKEN TO ENSURE
THAT ALL VEHICLES WHICH HAVE HAD THE FIX APPLIED WOULD PASS A TYPE
APPROVAL TEST?
6.1
In agreement with the KBA a representative sample from the affected vehicles
is retested under type approval conditions and under supervision by the KBA as an
external independent technical service.
6.2
The affected vehicles will pass the BUS testing . standard following
implementation of the technical measures in a manner that is fully approved by the
relevant regulatory authorities.
6.3
The Volkswagen Group has also sought, and is obtaining, initial confirmation
from the relevant approval authorities in respect of the technical measures. As you can
imagine, the Volkswagen Group, and the technical measures in particular, have been
rightly under considerable scrntiny. The KBA has signed off and confomed our
designs in respect of the technical measures.
7.
PLEASE PROVIDE A LIST OF ALL OTHER INVESTIGATIONS BY REGULATORY
AUTHORITIES WORLDWIDE,
7.1
We can confirm that the Volkswagen Group is facing a number of
investigations by regulato1y authorities worldwide. Whilst we are obviously keen to
assist the Committee in answering its questions, there is a degree to which the public
announcement of investigations is a matter primarily for the authority that is
conducting the investigation. We will also not necessarily have been provided with
information concerning the fact, or the status, of any investigation being conducted by
a regulatory authority.
7.2
That noted, our understanding is that investigations have been commenced in
Australia, Brazil, Canada, China, Denmark, France, Germany, Ireland, Italy,
Lithuania, Mexico, Poland, South Korea, Spain, Taiwan, the UK and the USA
amongst others.
7.3
To reiterate, for the reasons given in paragraph 7.1 above, it should be noted
that the examples provided above should not be regarded as an exhaustive list. Of
course, the Volkswagen Group is committed to working closely with regulatory
authorities worldwide. In the UK we have been in close contact with the VCA, the
DVLA and the DVSA as well as with the DIT and BIS.
8.
I WOULD LIKE YOU TO PROVIDE INFORMATION ON:
A) WHEN VOLKSWAGEN GROUP FIRST BECAME AWARE OF THE UNDERSTATEMENT?
8.1
We refer to the Volkswagen Aktiengesellschaft press release of 9 December
(again, enclosed for ease of reference). As is clear from that statement, we are very
pleased to confirm that there has not been an understatement in respect of C02 (or
fuel efficiency) values. Almost all of the affected Volkswagen Group brand models
do in fact conform to the C02 levels as originally dete1mined. Clearly, that is
extremely positive news.
8.2
That being the case, we anticipate that your concerns surrounding when this
issue first became known to Volkswagen Aktiengesellschaft will considerably reduce.
But, to answer the question, the Volkswagen Group first became aware of potential
irregularities in C02 measurements in early November 2015.
8.3
We regret the unce1tainty caused in relation to the C02 issue, but you will, no
doubt, understand that the Volkswagen Group was very keen to ensure that any such
infonnation was made available to the public and regulators as soon as possible. We
hope that the very early publication of our concerns, as well as our ultimate response,
go some way toward demonstrating that the Volkswagen Group is committed to
clarification and transparency as we go through this difficult period.
B) WHICH VEHICLE MODELS ARE AFFECTED?
8.4
We want to be very clear that, based on our cunent understanding it is our
position that no vehicles have been affected by an "understatement of C02 emissions"
and no vehicles have had the incorrect C02 measurements applied at the type
approval stage.
8.5
However, as part of our investigations into the potential C02 issues, we
dete1mined that, for the Volkswagen brand, there are nine model variants (only five of
which are sold in the UK) where a slight deviation was found, such that futther testing
is being carried out. The variants that are affected are appended to the enclosed press
release.
8.6
As is noted in the press release, we will be engaging with the appropriate
authorities to conduct the relevant measurements for those model variants by
Christmas. When fmther concrete information becomes available in respect of the
measurements for the nine model variants affected, we will provide that additional
infonnation to our customers and the Transport Select Committee. Our view is that
this process does not invalidate or conect the previous figure which was accurate for
the time that it applied (and, indeed, it will not have an effect upon consumers' real
world fuel consumption or C02 emissions figures, given that they are governed by an
individual's driving style and conditions on the road).
C) WHAT PLANS YOU HAVE TO REIMBURSE NATIONAL FINANCE MINISTRIES FO~ THE
SHORTFALL IN VEHICLE TAXES THAT ARE BASED ON EMISSIONS?
8.7
We believe that this issue of tax reimbursement has largely fallen away as a
result of our finding that no unlawful change to the stated fuel consumption and C02
figures has been found to date. Our position is that there is therefore no need to
retrospectively amend the figures, which is what could give rise to a tax liability. The
C02 measurements for homologation were accurate and in line with the relevant
regulations.
8.8
Nonetheless, to the extent that any deviations in production have implications
in terms of taxes and duties - and it is impmiant for us to be clear that we do not think
that they do - it remains our position that any additional taxes and duties properly due
as a direct result of the C02 issue should be charged directly to the Volkswagen
Group, and not to customers.
0) WHAT PLANS YOU HAVE TO COMPENSATE OWNERS OF AFFECTED VEHICLES WHO
MIGHT NOW HAVE TO PAY HIGHER VEHICLE TAXES THAN THEY WERE LED TO
BELIEVE?
8.9
At the moment, we do not believe that it is necessary to do this. We do not
believe that any customers will need to pay higher vehicle taxes as a result of any
wrongful application of C02 emissions figures. As explained above, this issue has
fallen away given that no unlawful change to the stated fuel consumption and C02
figures has been found to date.
E) WHETHER THAT COMPENSATION WILL EXTEND TO OWNERS OF SECOND HAND
VEHICLES IN THE FUTURE?
8.10 We do not believe that it is necessary to do so.
explained above.
That is for the reasons
F) THE NUMBER OF VEHICLES AFFECTED IN THE UK, EUROPEAN, US AND OTHER
MARKETS?
8.11 As stated above (at paragraph 8.4) of this response, no vehicles have been
affected by an "understatement of C02 emissions" and no vehicles have had the
inconect C02 measurements applied at the type approval stage.
8.12 However, as noted, there are cet1ain model variants where a slight deviation
was found, such that further testing is being canied out in collaboration with the
relevant approval authorities. Given that that testing is yet to be concluded for all of
the brands, we are unable to provide you with definitive figures for the number of
vehicles that are affected by these nonnal production conformity issues.
8.13 However, we can say that we anticipate that the number of vehicles affected
will be relatively small. For instance, for the Volkswagen brand, as noted above, we
anticipate that only five Volkswagen brand model variants sold in the UK will be
affected.
8.14 Fmihermore, we can say with ce1iainty that the number of vehicles affected is
much smaller than the 800,000 worldwide figure that was initially reported, with the
projected worldwide annual sales for the nine Volkswagen brand model variants
estimated to amount to only 36,000 vehicles.
G) THE SIZE OF THE DISCREPANCY BETWEEN THE ADVERTISED C02 EMISSIONS AND
FUEL ECONOMY AND ACTUAL PERFORMANCE?
8.15 As set out above, there is no discrepancy for any models to date. We can
confi1m that certain model variants are to be remeasured as pali of the usual checks
relating to production conformity, to see if they require amendments to the type
approval numbers. Those remeasurements - carried out in cooperation with the
relevant regulatory authorities - have not yet all been concluded, but our anticipation
is that any amendments are expected to be very slight.
II) VW GROUP'S PLANS FOR COMPENSATING VEHICLE OWNERS?
8.16 We do not have any plans to compensate owners in respect of the C02 issue,
as we do not believe that it is necessary to do so. As you know, compensation
requires a fault which has given rise to some fonn of loss. That is, for the reasons
explained above, not the case here.
8.17 We are genuinely sorry for any unce1iainty that our announcement on 3 ·
November created.
I) PLEASE EXPLAIN THE IMPACT OF UNDERSTATING C02 EMISSIONS ON
VOLKSWAGEN'S FLEET AVERAGE?
8.18 As explained in response to question 8(A), we have dete1mined that no
unlawful change to the stated fuel consumption and C02 figures has been found to
date. As a result, we do not believe that it is true to say that "understating" of C02
emissions has occmTed. To be clear, there is no impact to declare.
9.
PLEASE EXPLAIN VOLKSWAGEN GROUP'S FULL REASONING FOR
COMPENSATING VW OWNERS IN THE UNITED STATES AFFECTED BY THE NOX
EMISSIONS SCANDAL BUT NOT VW OWNERS IN EUROPE?
9.1
To be accurate, a goodwill payment is not a fo1m of compensation in the sense
that it does not affect a consumer's right to legally claim fo1' financial compensation.
9.2
To encourage brand loyalty and to generate positive feelings towards the
brands, in recognition of the recent turbulent times and lack of trust in the
Volkswagen Group, the Volkswagen Group will be providing a package to consumers
tailored to each country and its pa1iicular circumstances. This is to seek to encourage
loyalty to the brand, and to rebuild the trust that has been lost.
9.3
In the UK, Volkswagen has been focussing on developing the technical
measures as soon as possible. We believe that we have developed a technical fix for
all of the affected engines. As noted above, those measures have been confirmed by
the KBA and involve either a simple software update (taking around 30 minutes) or a
software update and a minor hardware change involving the insertion of a flow
transformer which will also take under an hour to complete.
The technical measures are designed to have no impact on performance and
9 .4
the measures are of such a limited nature that we are very optimistic that that will be
the case. As we state above, the affected vehicles will then be capable of meeting the
testing limits for NOx during testing in a manner that is fully approved by the relevant
regulatory authorities. There may even be benefits in terms of reduced NOx
emissions going fo1ward due to the advances in technology and learning since the
affected vehicles were produced.
That being the case, in the UK, rather than offering a separate financial
9.5
payment as a goodwill gesture at this stage, we think that, with the fix just around the
comer, the sums available for such a goodwill payment should be spent on
maximising the uptake of the technical measures among customers, and ensuring that
it is done with as little inconvenience to them as possible.
9.6
The details are still being finalised (and discussed with the VCA), but the
Volkswagen Group in the UK are looking at a range of options to minimise customer
inconvenience. Those options are dependent on the technical solution and include a
range of mobility options, free of charge, where appropriate.
9.7
In the US, the Volkswagen customers are in a very different position and
hence why Volkswagen has adopted a different solution. The most imp01iant
differences are:
(a) firstly, given the different regulations in the US, and the different engine
configurations, it could be the case that most US Volkswagen customers will
have to wait considerably longer for the technical measures to be implemented
than UK customers. At present, no technical measure is confirmed by the EPA
and there is no timetable laid out for when this will occur as far as we know.
That goodwill gesture in the US therefore recognises that uncertainty, and
seeks to encourage loyalty in that group whilst they wait for the technical
measures to be developed.
(b) secondly, the US market - with a diesel market share of roughly 3 percent - is
a niche market in terms of its specific situation with regard to diesel
technology and cannot be compared with other markets. The current diesel
issue has led to a sales stop for both new and used vehicles fitted with the
affected TDI engines, and appears to have had a major impact on customers'
confidence in this technology which is still at a very early stage. For this
reason, Volkswagen Group of America decided to introduce this goodwill
package for existing customers and hope that they see this as a first step
towards restoring their invaluable trust.
VOLKSWAGEN AKTI ENG ESE LL SC HAFT
Presse I News I Prensa I Tisk I Imprensa I Prasa I Stampa I Pers I ffiµij
IDpecca
Volkswagen making good progress with its investigation, technical
solutions, and Group realignment
• Initial results of the emissions investigation available
• Approximately 450 external and internal experts involved in the investigations • 100 terabytes of data secured - equivalent to information in approximately 50 million books • Volkswagen will have future emissions tests evaluated independently
• Technical solutions for customers in Europe developed; implementation
to begin in January 2016
• Group realignment making good progress
Wolfsburg, December 10, 2015 - The Volkswagen Group's realignment is well
underway. The Group is making progress on all five of the priorities it set at the end of
October: The technical solutions for customers in Europe have been devised,
presented to the authorities, and positively evaluated by them. These solutions will
begin to be implemented in January 2016. The emissions investigation is producing
results, and initial consequences have already been drawn based on the findings to
date. The implementation of the new structure is proceeding according to plan, and the
process of developing a new strategy has commenced. The Chairman of the
Supervisory Board of Volkswagen AG, Hans Dieter Petsch, told the press in Wolfs burg
today: "The Volkswagen Group is fully functional in every respect, even during these
eventful days. How, and when we meet the current challenges is primarily - although
not solely - up to us. In order to pass this test, we must make an enormous, common
effort - and we are all ready to do so." The Chairman of the Board of Management,
Matthias Muller, said: "We are doing everything to overcome the current situation, but
we will not allow the crisis to paralyze us. On the contrary, we will use it as a catalyst to
make the changes Volkswagen needs."
For the first time, the Company provided detailed commentary on the status of its
investigation, which is being coordinated by a special committee of the Supervisory Board.
Approximately 450 internal and external experts are involved in the investigations, which are
being conducted in two phases. An internal review, being conducted by a task force of experts
from various Group companies with a clearly defined mandate and a deadline, is focused on
the mandate to Group Audit by the Supervisory Board and the Management Board to
investigate relevant processes, reporting and monitoring systems, and the associated
infrastructure. Group Audit will provide its findings to the external experts of Jones Day. The
Supervisory Board has given this internationally respected law firm a parallel mandate to
completely clarify the facts and responsibilities - i.e., among other things, it has been asked to
conduct a forensic investigation. In connection with its work, Jones Day is being provided with
operational support by the audit firm Deloitte.
No. 437/2015
VOLKSWAGEN AKTI ENGE SE LLSCHAFT
Page2
Group Audit has identified process weak points
As reported on Wednesday, extensive internal investigations, which were subject to external
independent review, did not confirm the suspicion of irregularities during the C0 2 certification
process. Now, the first significant findings in the investigation of the nitrogen oxide (NOx)
issue are available. Group Audit's examination of the relevant processes indicates that the
software-influenced NOx emissions behavior was due to the interaction of three factors:
•
•
•
The misconduct and shortcomings of individual employees
Weaknesses in some processes
A mindset in some areas of the Company that tolerated breaches of rules.
It is clear that, in the past, deficiencies in processes have favored misconduct on the part of
individuals. This is true, for example, for test and certification processes affecting our engine
control devices, which were not suited to preventing use of the software in question. Group
Audit has suggested specific remedies to correct this. We are concentrating on structuring
these processes more transparently and systematically. For example, in the future, software
for engine control devices will be developed more strictly in accordance with the 4-eyes
principle. In addition, the bodies responsible for the release of such software are being
reorganized. They will be given more sharply defined and binding powers and responsibilities.
Deficiencies were also found in reporting and monitoring systems. The main problem there
was that responsibilities were not sufficiently clear. Volkswagen will now further sharpen them.
Group Audit also found deficiencies in some areas of Volkswagen's IT infrastructure. These
deficiencies will also be remedied. Volkswagen will introduce IT systems that allow individual
processes to be monitored with greater efficiency and transparency. This will simultaneously
reduce our dependence on individuals when problematic processes have to be identified and,
if necessary, escalated. As Potsch stated: "Group Audit's investigation is producing valuable
findings, which will help us create a structure that, rather than favoring breaches of
regulations, will prevent them, or at least allow them to be detected early on."
The Company has already drawn a key conclusion based on Group Audit's findings, namely
that its testing practice must undergo comprehensive changes.
Volkswagen has decided that in the future emissions test will be evaluated externally and
independently. In addition, randomly selected real-life tests to assess emissions behavior on
the road will be introduced. Chairman of the Supervisory Board Potsch stated: 'We hope that
this will help Volkswagen regain lost trust."
More time is required for the external investigation
Although Group Audit's analysis of the processes will be concluded shortly, Jones Day will
need well into next year in order to finish its work. The external investigators will need more
time for their investigation, for two reasons. The first is that they have a massive volume of
data to screen. At present, 102 terabytes of information have been secured, which is the
equivalent of the information contained in approximately 50 million books. More than 1,500
electronic data storage units have been collected from approximately 380 employees. The
second reason is that their investigation of the facts takes legal responsibility into account.
Therefore, their findings must not only be plausible and consistent, but must also hold up in
No. 437/2015
VOLKSWAGEN AKT[ ENG ESE LLSCHAFT
Page3
court. Volkswagen plans to provide a status update on the external investigation at its Annual
General Meeting on April 21, 2016.
The information that has been screened to date has largely explained the origin and
development of the nitrogen oxide issue. It proves not to have been a one-time error, but
rather a chain of errors that were allowed to happen. The starting point was a strategic
decision to launch a large-scale promotion of diesel vehicles in the United States in 2005.
Initially, it proved impossible to have the EA 189 engine meet by legal means the stricter
nitrogen oxide requirements in the United States within the required timeframe and budget.
This led to the incorporation of software that adjusted nitrogen oxide emission levels
according to whether vehicles were on the road or being tested. Later, when an effective
technical process was available to reduce NOx emissions, it was not employed to the full
extent possible. On the contrary, the software in question allowed the exhaust gas treatment
additive "AdBlue" to be injected in variable amounts such that the NOx values were
particularly low when vehicles were in the test bay, but significantly higher when vehicles were
on the road.
Hans Dieter Piitsch stressed that, "No business transaction justifies overstepping legal and
ethical bounds." As a first step, nine managers who may have been involved in the
manipulations were suspended. Potsch emphasized: "I here and now guarantee that we will
pursue our thorough investigation to its conclusion. I vouch for this personally, as does the
entire Supervisory Board of Volkswagen AG."
Technical solutions, which have been positively evaluated by the German Federal Motor
Transport Authority ("Kraftfahrtbundesamt"), are now available for the European variants of the
EA 189 engine type affected. Volkswagen is thus ensuring that the models affected in Europe
will meet all legal requirements in the future. The costs of implementing these solutions will be
manageable in technical, manufacturing, and financial terms. The software of the 2.0 and 1.2
liter TOI will be updated. For the 1.6 liter TOI, a so-called flow transformer will be used that
increases the measurement precision and, in combination with redesigned software, will
optimize injection quantity.
Now that the technical solutions have been approved, Volkswagen is working intensely on
plans to implement them. The recall of the highest-volume variant, the 2.0 liter TOI, will begin
in January 2016. The recall of the 1.2 liter TOI is currently scheduled to begin in the second
quarter. The implementation phase for the 1.6 liter models is planned to begin in the third
quarter to allow time to prepare for the hardware modification. Under the current plan, the
entire initiative will take at least all of calendar year 2016. Matthias MUiier, Chairman of the
Board of Management, promised: "Volkswagen will not rest until this matter has been resolved
once and for all to our customers' satisfaction." Volkswagen will inform the owners of the
affected vehicles individually as to when their vehicles will be updated. Volkswagen
guarantees that the solutions will be implemented free of charge. The company waives any
statute of limitations for the technical solutions, and will provide an appropriate replacement
vehicle if required.
Due to far stricter nitrogen oxide limits in the United states, it is a greater technical challenge
to retrofit the vehicles such that all applicable emissions limits can be met with one and the
same emissions strategy. To this end, Volkswagen is cooperating closely with the United
States Environmental Protection Agency (EPA) and the California Air Resources Board
No. 437/2015
-----u---,
VOLKSWAGEN AKTI ENG ESE LLSCHAFT
Page4
(GARB). The solution designed for North America will be presented as soon as it has been
approved by the responsible authorities.
Implementation of the new Group structure commenced
Parallel to overcoming the crisis, Volkswagen is also instituting a comprehensive new
alignment that affects the structure of the Group, as well as its way of thinking and its strategic
goals.
Volkswagen will be managed in a more decentralized fashion in the future, and its brands and
regions will be granted more independence. The Group's Board of Management is fully
focused on its core task: advancing the major, global issues for the future, as well as
synergies, controls, and strategy. Volkswagen will have significant input to the technical
changes that have a major impact on its own business model, becoming more agile, and
streamlining its decision-making processes. In addition, Volkswagen will become leaner and
improve cost efficiency. All these structural changes ultimately aim to reduce managerial
complexity and ensure that the Group can be effectively led over the long term.
At an organizational level, with the appointment of Dr. Christine Hohmann-Dennhardt, the
Integrity & Law area will be represented as its own department on the Group's Board of
Management in the future - a clear indication that these issues are extremely important to
Volkswagen. Significantly more importance will be attached to digitalization, which will report
directly to the Chairman of the Board of Management. Overall, direct reports will be reduced
from more than 30 to 19.
The renewal of personnel in the Group has recently again been given new impetus. Since the
beginning of 2015, the Group's Board of Management has seen six new members join, seven
of the brands have had their top personnel changed, and eight departments falling within the
CEO's area of responsibility now have new heads. MOiier stated: "The team with which we
wish to address the challenges of the coming months and years is in place." The details of the
new structure are to be worked out in the first quarter of 2016. The new structure will be in
place Group-wide by the start of 2017.
New mindset initiated
MOiier noted: "We can have the best people, and a great organization, but we can do nothing
without the right attitude and mentality." During the upcoming process of change toward a new
way of thinking, Volkswagen can build on its traditional strengths: quality consciousness,
strong identification with its vehicles, and a high degree of social responsibility. According to
MOiier, the future will be about more open discussions, closer cooperation, and a willingness
to allow mistakes if they are understood as an opportunity to learn. The Chairman of the Board
of Management stated, "We don't need yes-men, but managers and engineers who make
good arguments in support of their convictions and projects, who think and act like
entrepreneurs. I am calling for people who are curious, independent, and pioneering. People
who follow their instincts and are not merely guided by the possible consequences of
impending failure. In short: the future at Volkswagen belongs to the bold. We need a little more
Silicon Valley, coupled with the competence from Wolfsburg, lngolstadt, stuttgart, and the
other Group locations."
No. 437/2015
VOLKSWAGEN AKTJ ENG ESE LLSCHAFT
Page5
New strategic destination under development
In addition, Volkswagen has initiated development of a new strategic target: "strategy 2025",
with which Volkswagen will address the main issues for the future, is scheduled to be
presented in mid 2016.
MOiier explained, "We are realigning Volkswagen strategically and technologically. Our goal is
to courageously and decisively participate in shaping the future of mobility." Among other
things, the Group aims to achieve a significant expansion of its sales outside of its current core
business. Furthermore, a digitalization and an electrification offensive are being prepared.
In parallel, Volkswagen is currently doing everything it can to limit the effect the current
situation has on its business performance. The operating business is meeting expectations,
and the 2015 annual forecast, which was updated at the end of October, remains unchanged.
The sales figures are very mixed as regards the various markets and brands. MOiier
explained, "Overall, the situation is not dramatic, but, as was to be expected, it's tense."
In summary, the Chairman of the Board of Management stated: "Although the current situation
is serious, this company will not be broken by ii. We have a clear mission: we will create a
new, better, and stronger Volkswagen. A company that uses its strengths to make the
transition to the new world of automobiles. A company that now releases new forces, and
takes better advantage of its huge potential. And, last but not least, a company that will be
successful over the long term on the basis of strong values."
Volkswagen Group Communications
Head of Group Communications
Hans-Gerd Bode
Phone: +49 (0) 53 61 / 9 - 2 43 19
www.volkswagen-media-services.com
www.volkswaqenag.com
Volkswagen Group Communications
Head of Group Communications
Company and Business
Eric Felber
Phone: +49 (0) 53 61 / 9 - 8 75 75
E-mail: [email protected]
www.volkswagen-media-services.com
No. 437/2015
VOLKSWAGEN GROUP UNIHQ KINPDOM LTD
YOUR RCfERHlCE
Mr Huw lrranca-Davies MP
Chair of the Environmental
Audit Committee
Committee Office
House of Commons
14 Tothlll Street
London SW1 H 9NB
OUR REFERENCE
01908 601789
01908 601295
[email protected]
7 December 2015
Dll':£CT TELE.PHONf
DIRECT fAX
f·MAIL
oAH
Dear Mr lrranca-Davies
Response to Environmental Audit Committee Questions
VOlKS\VAGEN GROUP
Thank you for your letter dated 11 November 2015.
UNITED !<INGOO,'.\ l!MIT[D
\'EOMI\NS nRP/E
I wish to reiterate my thanks for the opportunity to appear before the
Environmental Audit Committee on 15 October 2015.
8lA\.:ELAUDS
As an organisation, Volkswagen is absolutely committed to ensuring that its
vehicles meet air pollution standards. As part of that commitment, we fully
support the introduction of more representative NOx emissions standards.
T[l[f'IION( 01908 601GOJ
Since I came before the Committee, you will have seen the press statements
(attached) made by a senior member of Volkswagen AG's Board of
Management. Whilst Independent investigations will be ongoing for some lime, I
wish to make clear to the Committee that the issues relating to the certification
process for C02 and fuel consumption values are separate to those relating to
NOx emissions.
I enclose responses to each of the addilional questions that you set out In your
letter. I hope that these responses help provide the further clarity sought by the
Committee, while recognising that precision In some areas will have to wait for
the results of further investigations.
We fully recognise that we have not met the standards expected of us and, once
again, on behalf of Volkswagen, I wish to reiterate my sincere apologies and to
stress that we will take the necessary actions to regain the trust of our
cust er and the wider public.
W..j.N
,
~~
Pau Willis
Mana g Dlrec
Volkswagen roup UK Limited
MllTON •:l-YNl-~
MKl4 SAH
fl\CSlMllE 01908 663936
1-!ffilSH:IU:t> Of-f-lCE AS ABOVE
REGISTEP..EO IN ENGlAl,j[J
REGISTERED Ho. Sil,809
A \'/HOUY 01//NED SUBSIDIARY
Of VOLKSWAGEN AG
RESPONSE TO ENVIRONMENTAL AUDIT COMMITTEE QUESTIONS
WE UNDERSTAND THAT EACH MODEL IS DIFFERENT AND THAT THERE ARE
DIFFERENCES IN WHAT COULD DE CONSIDERED 'REAL WORLD DRIVES' SO PLEASE
USE AVERAGE OR T\'PICAL VALUES,
The Volkswagen Group does not possess data that could reliably be considered to be
average or typical values for 'real world driving in the UK. Given the lack of
consensus as to what an average UK drive is, such values for real world driving
simply do not exist.
Whilst you may be sceptical as to why VW Group does not possess such data, please
bear in mind that if Volkswagen were to independently develop such average or
typical values, we would hesitant to publicise such values given the lack of
comparability of such values with other manufacturers' vehicles and the consequent·
potential for this data to cause confusion amongst the public.
WITH REGARD TO THE DIFFERENCE BETWEEN THE LEVEL OF NOX EMISSIONS
RECORDED FROM A V\V VEHICLE WITH A DEFEAT DEVICE FITTED AND ONE
WITHOUT:
1.
IF VOLKSWAGEN HAD PROGRAMMED THE SOFTWARE TO ENSURE THE LEGAL
LIMIT WAS MET IN THE REAL WORLD AS WELL AS THE LABORATORY, HOW MUCH
NOX EMISSION PER CAR, ON AVERAGE, WOULD HAVE DEEN SAVED?
1.1
In answering these questions we note that, whilst the issue of whether or not a
"defeat device" was used is still to be determined, Volkswagen accepts that software
was used in type EA 189 diesel engines that optimises NOx emissions during the
emissions tests.
1.2
We must be very clear that there is presently neither a legal real world testing
limit for NOx on the road nor an accepted comparable method of testing for those real
world NOx emissions on the road. Instead, there is only a limit for NOx in the
laboratory using standardised testing methods (see for example 2008/C 182/08,
Paragraph 10). The cunent legal method of testing for NOx emissions in the
laboratory is widely recognised to be out-dated and not reflective of real world
driving.
1.3
As there is no legal limit for N Ox emissions in the real world, it is impossible
for the Volkswagen Group to meet it. Given the impossibility of programing software
to meet that undefined limit, it is also impossible for us to quantify the amount of
NOx emissions that would have been saved per vehicle.
1.4
At the moment, the UK's regulatory regime does not require the motor vehicle
industry to manufactme vehicles that comply with the NOx testing limits when they
are driven on the road.
2.
WHAT WILL THE COMPANY DO TO THE SOFTWARE WHEN YOU RECALL THE
AFFECTED CARS, AND HOW MUCH LESS WILL THEIR NOX EMISSIONS BE COMPARED
WITH THE LEVELS BEFORE RECALL?
2.1
NOx emissions in the real world (to which this question presumably relates)
are not based on emissions produced in the testing regime; instead they are dependent
upon the way vehicles are individually driven on the road. Individual driving styles
and conditions determine real world emissions and are often outside the parameters
of the laboratory testing standards.
As pati of the service action that the Volkswagen Group has proposed to the
2.2
relevant approval authorities, all of the affected vehicles will have their software
updated. That update will only happen once it has been approved by the authorities.
2.3
The result of that software being updated will be that the affected vehicles are
capable of complying with the testing limits for NOx during testing in a manner that is
fillly approved by the relevant regulatory authorities.
2.4
To do this, the Volkswagen Group will undeliake technical measures in 2016
and will be able to introduce and take advantage of the benefits of all of the
su):,sequent advances in diesel engine technology and, indeed, in advances in NOx
emissions testing (based on subsequently developed drive cycles, albeit none of which
are typical of "average driving" in the UK) developed since these older models were
originally produced. Since that time, there have been considerable advances in the
technology and learning concerning "after treatment" systems and how to optimise
their operation, controlled legitimately by the engine software.
2.5
In introducing this improved technology and learning into the older models,
the Volkswagen Group believes that the affected vehicles' real world NOx emissions
are likely to decrease as compared to levels that the original car would have produced
in similar conditions (bearing in mind, that there has never been an approved real
world drive cycle to allow such a comparison to be made with certainty). This would
be similarly the case if the Volkswagen Group introduced improved diesel technology
and learning into unaffected models from the years 2007-2012. That is, any reduction
in real world NOx et111ssions here is only caused by the introduction of the more
modern engine teclmology and learning via the technical measures.
2.6
This leads to a related issue raised during the session on 15 October 2015:
namely how much more NOx has been emitted by the affected vehicles in the real
world than would have been the case had the affected vehicles not had NOx emission
testing issues. To be clear, that question is different to Q2 above which considers the
future emissions after the technical measures being implemented.
2.7
It would obviously be preferable to be able to answer this question based on
objective data or measurements based on agreed standardised systems. However
when the affected vehicles were originally tested for NOx emissions limits, the only
relevant test was the laboratory dynometer bench test. There was no real world drive
testing required and no reliable acceptable way of conducting such tests. All of the
affected vehicles complied with the EU5 emissions limits as measured in the
laboratory bench test
If a driver drove the affected vehicle exactly like the ce11ification cycle NEDC
2.8
he or she would achieve the same emissions as achieved in the laborato1y during
emissions testing. But, it is highly unlikely that vehicles would have been driven on
UK roads in a manner similar to the laboratory bench testing. It is, therefore, the case
that the emissions in the real world in the UK from those vehicles would have been
higher than those measured in the laboratory. This would have been the case for all
manufacturers' vehicles.
2.9
In summary, the testing software does not influence NOx emissions on those
vehicles when driven in the real world. Instead it is the driving style or cycle or
conditions of driving that actually influences the NOx emissions.
3,
AFTER VOLKSWAGEN HAS CHANGED THE SOFTWARE FOLLOWING RECALL,
HOW l\lUCH DIFFERENT FROM THE REGULATORY LIMIT WILL THE REAL WORLD
EMISSIONS BE, AND WHY SHOULD THEY BE DIFFERENT AT ALL?
3.1
As we have noted above, given that there is no consensus on what amounts to
real world driving in the UK, we are unable to quantify the difference between the
regulatory NOx limit during testing and the actual real world NOx emissions on the
road.
3.2
However, ilrnspective of any software that is updated as pait of the proposed
service action, it must be recognised that the current regulatory regime and the present
technology available to all manufacturers means that, in practice, there will be a
difference between a vehicle's NOx emissions during testing and emissions on the
road when driven in a different manner. The extent of that difference will depend
upon precisely how the car is individually driven and the conditions under which it is
driven. We anticipate that those differences will remain after the approved software is
updated, as would be the case for all manufacturers' vehicles.
3.3
As stated above, if you have a regulatory regime that is not related to real
world driving (and no regulatory regime can be reflective of all driving in all
circumstances), then there will be a difference between real world emissions and
regulatory emissions in testing.
3.4
The current regulatory testing regime has deficiencies that are widely known
both inside and outside of the motor vehicle industry. For that reason, we support
moves toward a more appropriate testing regime that better reflects real world driving.
-----------------·-·-
---~
4.
V OLKS\VAGEN UK HAS STOPPED SELLING NEW CARS WHICH COULD HAVE
"DEFEAT" DEVICES, HAVE YOU ALSO STOPPED POTENTIALLY AFFECTED MODELS
BEING SOLD THROUGH YOUR USED CAR PROGRAMME, DAS WELTAUTO?
4.1
Volkswagen has not halted sales of used vehicles that have the potential to be
affected by the NOx issue via the Das WeltAuto programme. We have taken this
decision because:
(a) those vehicles remain teclmically safe and roadwo1thy, and are already legally
on the road.
(b) all of the affected vehicles will be subject to the approved technical meas mes
in the near future.
(c) any customer that is considering purchasing one of the affected vehicles will
be notified of that fact, as well as the necessity of the implementation of a
technical measures, before they purchase the vehicle in question.
WILL VOLKSWAGEN UK OFFER ANY INCENTIVES TO CUSTOMERS IMPACTED
BY THE ISSUE TO UNDERTAKE A FIX THAT MIGHT IMPACT THEIR CARS'
PERFORMANCE?
5.
5.1
Om intention remains that the implementation of the technical measures will
not affect the vehicles' performance. Once it has been confirmed that performance
will not be affected, this will be widely publicised, so as to ensure that customers are
encouraged to adopt the implementation of the technical measures. The work that is
undertaken in relation to that fix will be carried out free of charge.
In line with the DVSA's Guidelines, the Volkswagen Group will not offer an
5.2
incentive to customers to encourage them to implement the technical measmes. In the
event that the implementation of the teclmical measmes is lower than hoped, this can
be reviewed with the DVSA.
5.3
We can also confirm that our anticipation is that. the timing for implementation
of the technical measures for all of the affected vehicles is expected to be less than
one hour. As a result, and so as to minimise inconvenience, our anticipation is that the
technical measures can be implemented as part of owners' usual service, which has
traditionally encouraged high take up, or by making a shmt visit to an authorised
retailer. The Volkswagen Group in the UK are looking at a range of options to
minimise customer inconvenience. Those options are dependent on the teclmical
solution and include a range ofmobility options, free of charge, where appropriate.
6.
You WILL BE AWARE OF THE RECENT DECISION BY THE EU TECHNICAL
COMMITTEE ON MOTOR VEHICLES TO SIGNIFICANTLY INCREASE THE PERMITTED
LEVELS OF NOX EMISSIONS FROM EURO 6 VEHICLES AND DELAY THE
IMPLEMENTATION OF THE LIMITS FOR ALL NEW CARS UNTIL 2019. DOES
VOLKSWAGEN UK SUPPORT THAT DECISION?
6.1
Yes, the Volkswagen Group supp01ts the decision of the EU Technical
Committee of Motor Vehicles (TCMV), as supported by the British Government, and
the introduction of a more modern real driving emissions (RDE) testing regime. The
legislation is due to be implemented in 2016 with a monitoring phase. Limits will
apply from September 2017.
6.2
RDE and the conformity factor applicable from 2020 of I plus a margin for
error of 0.5 represents a major challenge for the industry. Up until now the indushy
was legally required to meet the limits under NEDC. The timeline, boundary
conditions and conformity factors agreed by TCMV are extremely challenging for the
industty.
7,
CAN YOU CONFIRM THAT VW HAS NO REASON TO THINK THAT "DEFEAT
DEVICES" MIGHT FEATURE IN MODELS OF VEHICLE- VW OR OTHERWISE· THAT
HAVE NOT YET BEEN RECALLED FROM SALE?
7.1
We can confirm this for Volkswagen UK models based on our current
information.
8.
IT HAS EMERGED THAT THERE ARE 11 IRREGULARITIES 11 AND 11 UNEll.'PLAINED
INCONSISTENCIES" IN THE LEVELS OF C02 EMITTED BY VW CARS, AND THAT C02
LEVELS AND FUEL CONSUMPTION FIGURES FOR SOME MODELS WERE SET TOO LOW
DURING TESTS. CAN CONSUMERS BE CONFIDENT THAT THE RATINGS ON FUEL
CONSUMPTION AND C02 EMISSIONS PROVIDED FOR THEIR CARS ARE ACCURATE,
AND IF NOT, WHAT STEPS WILL VW UK BE TAKING?.
8.1
In the UK the vast majority of drivers who have purchased Volkswagen Group
vehicles can be confident that the C02 emissions levels and the fuel consumption
figures for their vehicles are accurate based on current knowledge.
8.2
However, our initial investigations suggest that a very small minority of
owners may be potentially affected by the issue that you have raised. Investigations
are currently ongoing to determine:
(a)
specifically which vehicles are affected; and
(b)
the extent of any irregularities.
8.3
We appreciate that, given the ongoing investigation, the level of information
presently available in relation to the C02 emissions issue is relatively limited. For
that reason, and if it would be helpful, we would be pleased to write to the Committee
again at a later date to provide additional information.
8.4
Once we have that infonnation, and have discussed it with the relevant
authorities, we will contact those customers that are affected to inf01m them of the
issue and of any steps that will need to be taken.
8.5
Please be assured that the Volkswagen Group is doing everything in its power
to clarif'y the situation and is closely liaising with the relevant approval authorities in
order to do so.
8,6
To the extent that the hrngularities in relation to C02 have implications in
terms of, the taxes and duties based on such figures, we can confirm that the
Volkswagen Group has contacted the relevant UK authorities to assure them that we
are willing to pay those potential additional taxes and duties properly due or payable
as a direct result of the C02 issue and to request that they are charged directly to the
Volkswagen Group and not to customers.
!
I
I
VOLKSWAGEN AKTI E IIG ES£ llSCHAfT
Presse I News I Prensa I Tisk I Imprensa I Prasa I Stampa I Pers I imllfl I Ilpecca
Statement on the announcement bY- the United States
Environmental Protection Agency (EPA)
Wolfsburg, November 2, 2015 - The United States Environmental Protection Agency
(EPA) Informed Volkswagen Aktlengesellschaft on Monday that vehicles with V6 TOI
engines had a software function which had not been adequately described in the
application process. Volkswagen AG wishes to emphasize that no software has been
installed in the 3-llter V6 diesel power units to alter emissions characteristics In a
forbidden manner.
Volkswagen will cooperate fully with the EPA clarify this matter In Its entirety.
Volkswagen Group Communications
Head of Group Communications
Hans-Gerd Bode
Phone: +49 (0) 53 61/9·24319
www.volkswagen-media-services.com
www.volkswagenag.com
Nr. 390 / 2015
----------,-,~-----­
-~-··~··~----­
VOLKSWAGEN AKTI E 1/G ESE llSCHAFT
Presse I News I Prensa ITlsk I Imprensa I Prasa I Stampa I Pers I ffefi !If) I Ilpecca
Clarification moving forward: internal investigations at Volkswagen
identify irregularities in C0 2 levels
• Matthias MUiier: "Relentless and comprehensive clarlflcallon is our only
alternative."
·
• Around 800,000 Group vehicles could be affected
• Initial estimate puts economic risks at approximately 2 billion euros
Wolfsburg, November 3, 2015 - The Volkswagen Group Is moving forward with the
clarlflcation of the diesel Issue: during the course of Internal investigations
irregularities were found when determining type approval C02 levels. Based on
present knowledge around 800,000 vehicles from the Volkswagen Group could be
affected. An Initial estimate puts the economic risks at approximately two billion
euros. The Board of Management of Volkswagen AG will Immediately start a dialog
with the responsible type approval agencies regarding the consequences of these
findings. This should lead to a reliable assessment of the legal, and the subsequent
economic consequences of this not yet fully explained issue.
Under the ongoing review of all processes and workflows in connection with diesel engines it
was established that the C02 levels and thus the fuel consumption figures for some models
were set loo low during the CO, certification process. The majority of the vehicles concerned
have diesel engines.
'From the very start I have pushed hard for the relentless and comprehensive clarification of
events. We will stop at nothing and nobody. This Is a painful process, but il is our only
alternative. For us, the only thing that counts is the truth. That is the basis for the
fundamental realignment that Volkswagen needs', Matthias MOiier, CEO of Volkswagen
Aktlengesellschaft, said, and added. "The Board of Management of Volkswagen AG deeply
regrets thls situation and wishes to underscore Its determination to systematically continue
along the present path of clarification and transparency."
In cooperation with the responsible authorities, Volkswagen will do e·verythlng in Its power to
clarify the further course of action as quickly as possible_ and ensure the correct C02
classification for the vehicles affected.
The safety of the vehicles Is in no way compromised. A reliable assessment of the scale of
these irregularities Is not yet possible. An Initial estimate puts the economic risks at
approximately two billion euros.
No. 392/2015
---------------------
- - - - - - · · · ~ · - · · ~ . ,..- - , ~..- - - ­
VOLKSWAGEN AKT IEUG ES£ llSCHAfT
Page2
Volkswagen Group Communications
Head of Group Communications
Hans-Gerd Bode
Phone: +49 (0) 5361 / 9-24319
E-mail: [email protected]
w11w.volkswagen-media-services.com
ww,v.volkswagenag.com
No. 39212015
VOLl<SWAGEN
AKTI f IIG f SE LlSCHAFT
Presse I News I Prensa ITisk I Imprensa I Prasa I Stampa I Pers I~PTI I npeccu
Statement of the Supervisory Board on irregularities in C02 levels
The Supervisory Board Is deeply concerned by the dls~overy of Irregularities found
when determining C02 levels for the type approval of Volkswagen Group vehicles.
These Irregularities canie to light during the clarification process which, as
· announced, is being relentlessly and comprehensively pursued. The Supervisory
Board and the special committee set up for the purpose of clarlflcatlon wlll meet In the
very near future to consult on further measures and consequences. The Supervisory
Board wlll continue to ensure swift and meticulous clarification. In this regard, the
latest findings must be an Incentive for the Supervisory Board and the Board of
Management to do their utmost to resolve such irregularities and rebuild trust.
Volkswagen Group Communications Head of Group Communications Hans-Gerd Bode Phone: +49 (0) 5361 / 9-24319 E-mail: [email protected] www.volkswagen-media-servlces.com www.volkswagenaq.com No. 393/2015
·voLKSWAGEN OROUP UNITEQ KINODOM LTD
YOUR REFERENCE
Mr Huw lrranca-Davles MP
Chair of the Environmental
Audit Committee
Committee Office
House of Commons
14 Tothlll Street
London SW1H 9NB
OUR P.EfERENCE
01908 601789
01908 601295
[email protected]
10 December 2015
DIRECT TELEPHONE
DIRfCT FAX
£,MAil
DATE
Dear Mr lrranca-Davles
Response to Environmental Audit Committee Questlo.ns
VOLl<:$\VAGEN GROUP
.1 write further to my letter dated 9 December 2015.
I enclose a press release Issued by Volkswagen Aktiengesellschaft yesterday.
As promised, I have also updated our response to the eighth question posed by
the Environmental Audit Committee concerning irregularities relating to C02 and
fuel consumption.
UNITED k!NGOO/,\ LIMITED
YEOMANS lJRlVE
BLAKELANDS
MllTOII Kf\'NIS
J,lK14 5AN
TELEPHONE 01908 601601
ur sincerely
~\j~? PauWlllis
/
Ma Ing Director
'
Volkswagen Group UK Limited
FACSIMILE 01908 663936
REGISTERED Off!CE AS ABOVE
REGISlEf:ED ltl U~GLAND
REGISTEf.:E!> No. St48:09
A\VHOllY OWNED SUBSIDIARY
OF VOLKS\'VAGEN AG
8, IT HAS EMERGED THAT THERE ARE 11 JRREGULARITIES 11 AND "UNEXPLAINED
INCONSISTENCIES" IN THE LEVELS OF C02 EMITTED BY VW CARS, AND THAT C02
LEVELS AND FUEL CONSUMPTION FIGURES FOR SOME MODELS WERE SET TOO LOW
DURING TESTS, CAN CONSUMERS BE CONFIDENT THAT THE RATINGS ON FUEL
CONSUMPTION AND C02 E~TISSIONS PROVIDED FOR TIIEIR CARS ARE ACCURATE,
ANDIFNOT, WHAT STEPS WILL VWUKBETAKING?
8.1
Yesterday, Volkswagen Aktiengesellschaft issued a press release relevant to
question eight. As you will see, Volkswagen Aktiengesellschaft has confirmed that
almost all of the possibly affected Volkswagen Group brand models do in fact
conform to the C02 levels as originally determined.
8.2
Clearly, that is very positive news to be welcomed. It confirms that consumers
who have purchased vehicles manufactured by the Volkswagen Group can remain
confident that the C02 emissions and fuel consumption figures for their .vehicles are
accurate.
8.3
For the Volkswagen brand there are nine model variants. where a slight
deviation of a few grams of C02 has been found. However, in respect of those
vehicles, our understanding is that any resulting changes going forward following the
usual homologation process will be very small and prospective. It is impo1tant to
state that the testing methods and standards used at Volkswagen are in line with those
commonly used in the industry. They comply with the relevant international rules for
such testing methods.
8.4
We would also like to emphasise two points in relation to those deviations for
those few model variants affected.
(a) Firstly, consumers' real world fuel consumption and C02 figures will not
change.
·
(b) Secondly, as production continues over time, an element of movement in C02
and fuel consumption values is experienced by some models from time to
time. This is not an abnormal occurrence. .As a result, there are established
processes by which vehicle manufacturers work closely with the relevant
approvals authorities in order to amend any values going forward. As is noted
in the press release, we will be engaging with the appropriate authorities to
conduct the relevant measurements by Christmas. When fmther concrete
info11nation becomes available in respect of the measurements for the nine
model variations affected, we will provide further information to our
. customers and the Committee. This process does not invalidate or correct the
previous figure which was accurate for the time that it applied.
8.5
Whilst we trnly regret the unce1tainty caused in relation to the C02 issue, we
hope that the early publication of our concems, as well as our ultimate response here,
go some way towards demonstrating that the Volkswagen Group is fundamentally
committed to transparency as we go through this difficult period.
--~
VOLKSWAGEN AKTJ ENGE 5 E LLSCHAFT
Presse I News I Prensa I Tisk I Imprensa I Prasa I Stampa I Pers I lt,frJij'J I Ilpecca
C0 2 issue largely concluded
• No unlawful change to the stated fuel consumption and C02 figures found
to date
• Only a small number of the model variants of new cars will have the
catalogue figure slightly adjusted
Wolfsburg, 9 December 2015 - Just a month after questions relating to the C02 figures
measured on some of the Group's models arose, Volkswagen has largely concluded the
clarification of the matter. Following extensive internal investigations and measurement
checks, it is now clear that almost all of these model variants do correspond to the C0 2
figures originally determined. This means that these vehicles can be marketed and sold
without any limitations. The suspicion that the fuel consumption figures of current
production vehicles had been unlawfully changed was not confirmed. During internal
remeasurements slight deviations were found on just nine model variants of the
Volkswagen brand.
These model variants will be remeasured by a neutral technical service under the supervision
of the appropriate authority by Christmas. In cases where the correctness of original figures is
confirmed, there will be no consequences. These cars can be offered for sale by dealers
without any reservations. In the case of any deviations, the figures will be adjusted in the
future in the course of the normal processes as required.
Volkswagen presented these results to the investigation commission of the Federal
Government and the Federal Motor Transport Authority (KBA). The figure of approximately
800,000 vehicles under suspicion originally published by the Volkswagen Group has not been
confirmed. The deviations found in the figures for only nine model variants amount to a few
grams of C02 on average, corresponding to increased cycle consumption in the NEDC of
approximately 0.1 to 0.2 litres per 100 kilometres. With an annual production of approximately
36,000 vehicles, these model variants correspond to around only 0.5 per cent of the volume of
the Volkswagen brand. The list of the nine model variants can be found at www.volkswagen­
media-services.com.
The Group's subsidiaries Audi, SKODA and SEAT have also agreed a similar procedure with
the approval authorities responsible for the vehicles initially considered.
Customers' real-world consumption figures do not change and neither are any technical
vehicle modifications necessary. Against this background, the negative impact on earnings of
€2 billion that was originally expected has not been confirmed.
Whether we will have a minor economic impact, depends on the results of the remeasurement
exercise.
No. 432/2015
VOLKSWAGEN AKTI ENGE SE LLSCHAFT
Page2
Please note: This text and the overview of vehicles to be adjusted in future with new C0 2
figures, model year 2016, can be found at www.volkswaqen-media-services.com. The
information contained in this press release does not apply to products and services from the
Volkswagen Group ofAmerica or Volkswagen Canada.
Volkswagen Group Communications
Head of Product Communications Group
Pietro Zollino
Phone: +49 (0) 53 61 / 9 - 2 99 22
E-Mail: [email protected].
www.volkswagen-media-services.com
www.volkswagenag.com
No. 432/2015
List of vehicles model year 2016 where C0 2 -values will be revised
Note: For nine model versions the voluntary follow-up measurements have shown that for them adjustments of C02-figures
need to be made. Going forward, they will be getting new catalogue figures at the earliest possible juncture as part of our
normal processes.
Car
Engine
Gearbox
Polo
1.01 TSI BlueMotion 70kW EU6
Seven-speed (DSG)
Scirocco
2.01 TOI BMT 135kW EU6
Six-speed manual gearbox
Jetta
1.21 TSI BMT 77kW EU6
Six-speed manual gearbox
Jetta
2.01 TOI BMT 81kW EU6
Five-speed manual gearbox
Golf Convertible
2.0I TOI BMT 81kW EU6
Five-speed manual gearbox
Golf
2.0I TOI BMT 110kW EU6
Six-speed manual gearbox
Passat Alltrack
2.01 TSI 4MOTION BMT 162kW EU6
Seven-speed (DSG)
Passat Variant
2.0I TOI SCR 4MOTION BMT 176kW EU6
Seven-speed (DSG)
Passat Variant
1.41 TSI ACT BMT 11 OkW EU6
Six-speed manual gearbox