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Volkswagen profit tops forecast, but takes another dieselgate hit

Volkswagen may be doing its best to placate diesel owners, but new lawsuits filed in the USA lay the blame for dieselgate on pervasive corporate culture not just a few bad staff. Painting a very different picture of the internal politics of the automaker, the NY and MA attorneys general accused the company of harboring a “willful and systematic scheme of cheating” today in state lawsuits.

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The suits were filed by New York Attorney General Eric Schneiderman in Albany, Massachusetts Attorney General Maura Healey in Boston and Maryland Attorney General Brian Frosh in Baltimore.

The New York complaint accuses company employees of trying to cover up the cheating by submitting false documents to state officials and destroying incriminating paperwork.

Volkswagen last month agreed to pay up to US$10 billion for vehicle buybacks and loss compensation to consumers, US$2.7 billion in environmental mitigation, US$2 billion on clean-emissions infrastructure and US$603 million to most states in a sweeping settlement that must still be approved by a federal judge.

VW has admitted that about 500,000 diesel cars it sold in the US had software created to cheat on emissions tests.

Volkswagen said it is cooperating with USA
authorities on a “national resolution” of all remaining environmental issues.

A Volkswagen spokeswoman told the New York Times Müller was not involved in any wrongdoing.

Two excerpts shared by New York AG Schneiderman include an email purportedly to VW’s CEO from its quality management director, and another to its communications head from the environmental and engineering director.

The three states accused VW of violating their environmental laws.

That Volkswagen used six different “defeat devices” to purposefully skirt USA emissions rules, including three generations of a device used in Volkswagens and other iterations used in Audi and Porsche diesel engines.

On Tuesday, the attorneys general of NY and MA claimed that VW’s inability to comply with USA emissions standards had allegedly “reached the attention” of Matthias Mueller, the current Volkswagen CEO, and his predecessor Martin Winterkorn as early as July 2006.

In the interest of saving money, the company instead made a decision to install defeat devices in the cars, the suit says.

The suits did not state Muller was aware of the cheating.

The states’ lawsuits follow a nine-month investigation by a coalition of more than 40 states, according to Schneiderman’s office. Prosecutors here and overseas are also looking at possible criminal charges.

In 2014, an academic study led to revelations that VW installed rogue software on hundreds of thousands of diesel cars sold in the United States since 2008.

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And California regulators recently rejected a plan by VW to fix some 16,000 3-litre diesel cars not included in the June settlement.

Three US states plan lawsuits over Volkswagen diesel pollution