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Chinese operations not involved in scandal, says VW

The German carmaker named company veteran Matthias Mueller as its new chief executive on Friday in an attempt to get to grips with a crisis that its chairman described as “a moral and political disaster”.

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VW has already pledged to cooperate with the EPA and other regulators investigating the emissions fraud and replaced Winterkorn with Porsche chief Matthias Mueller.

“His appointment is a step towards cleaning-up”, said LBBW analyst Frank Biller about Mueller, a former head of product strategy close to the Piech-Porsche family that controls Volkswagen.

Volkswagen rigged emission tests on about 2.8 million diesel vehicles in Germany, the country’s transport minister said on Friday, almost six times as many as it has admitted to falsifying in the United States (US).

Mock became suspicious when test results on diesel-powered vehicles in Europe were inconsistent.

But Henning Gebhardt, global head of equity at Deutsche Asset & Wealth Management, said Volkswagen had missed an opportunity.

But he acknowledges there is a degree of concern among German companies that the scandal over cheating on USA diesel emission could have a domino effect on their businesses, eroding the cherished “Made in Germany” label.

The new CEO said his priority is winning back the trust that has been lost in the company after the scandal.

While a big, and unknown, number, Volkswagen should be reasonably well placed to meet the direct financial costs (if they fall into the middle of a fairly wide range of expectations).

Jason Hanold, managing partner of Evanston, Illinois-based executive search firm Hanold Associates, said VW would be “spoiled for choice” if it decides to look outside company for its next CEO.

Daimler AG, the maker of Mercedes cars, is rejecting claims by a German environmental group that it appears to have been involved in manipulation of emissions data.

It appears VW intentionally deceived both the American consumer and the USA government, and put public health at risk, by knowingly planning and executing a fraud. The company faces as much as $18 billion in penalties in the US alone.

Initially, VW said nearly 500,000 diesel cars in the United States were affected.

Diesel is a petroleum-derived oil that can be used in some vehicle engines.

The same report helped reveal that Volkswagen was falsifying the results of tests in the US.

But I hope the Justice Department also considers what can be done to offset the damage to air quality created by the offending so-called “clean diesels”.

Grundler, who has been with the EPA for more than three decades, says the lack of on-road testing for diesels “might change in the future”.

“We categorically deny the accusation of manipulating emission tests regarding our vehicles”, the company stated.

Regaining trust will be especially hard in the auto industry, because vehicle buyers research their decisions carefully and Americans see their cars as an extension of themselves, said Trina Hamilton, a University of Buffalo professor who studies corporate responsibility.

Volkswagen has said 11 million cars are affected, but it is not clear how many of these are in Europe.

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VW was able to fool the EPA because the agency only tested the cars on treadmill-like devices called dynamometers and didn’t use portable test equipment on real roads.

Volkswagen pollution scandal backfires on diesel