VW examines newer engine’s involvement in emissions scandal

Volkswagen AG, trying to woo USA consumers amid its diesel emissions cheating scandal, is offering new-vehicle discounts that by one measure are nearly twice the industry average.

Volkswagen said in its statement there was no banned software built into vehicles with its latest EA 288 Euro 6 diesel engine, adding this had been confirmed by Germany’s KBA automotive regulator.

German monthly Manager Magazin reported on Saturday that Volkswagen expected the costs of the scandal to swell to a total of more than 30 billion euros. Since 2012, the EA 288 has been installed in vehicles such as the best-selling Golf, suggesting the number of additional cars could be in the millions.

Earlier this month, Germany’s Federal Motor Transport Authority (KBA) forced Volkswagen to recall 8.5 million cars equipped with the EA 189 diesel engine, of which 2.4 million have been sold in the local market while the rest are in the European Union.

Volkswagen has only said they are investigating, and so have issued no other details.

Should the engines contain a so-called “defeat device”, this could substantially widen the number of vehicles affected.

Two people close to the matter told Reuters that Volkswagen has now also suspended Hanno Jelden, the head of powertrain electronics, a 22-year VW veteran with expertise in engine and transmission electronics as well as hard- and software control systems.

Mueller said this month that, while the carmaker doesn’t need a revolution, he’s delaying or canceling non-essential projects to cut costs after VW admitted to cheating on USA emissions tests. On the road, their nitrogen oxide output reached 40 times the legal limit. A few of the smaller engines affected will also be fixable only with the software change.

The recall costs don’t include regulatory fines and potential lawsuit payouts to drivers that might await Volkswagen. Volkswagen has set aside $7.3 billion, but this won’t cover more than repairs and a massive PR effort to try and retain a customer base.

Edmunds.com anticipates that Volkswagen/Audi will combine to grow sales 5.1 percent from the same period a year ago.