VW shares plunge after auto maker admits rigging U.S. emissions tests

Just past year the EPA issued a record $300 million fine to Hyundai and Kia for misrepresenting their fuel economy. The 4 cylinder Audi and Volkswagen vehicles from the period 2009 to 2015 are the ones recalled.

Christopher Grundler, director of the EPA’s Office of Transportation of Air Quality, said in a Detroit News interview Friday that the government agency took the unusual step of refusing to grant VW a “certificate of conformity” to sell 2016 model diesel cars with 2.0-liter diesel engines.

The EPA also indicated the scale of the fines that could be imposed on VW.

The German automaker said in a statement it is cooperating with the investigation, but declined to comment further.

Despite the seriousness of the violation, the EPA said VW will be given “a reasonable amount of time to develop a plan to complete the repairs”, including both the fix procedure and manufacture of any needed parts. VW did not indicate on Friday how it will address the issue.

“Put simply, these cars contained software that turns off emissions controls when driving normally and turns them on when the auto is undergoing an emissions test”, Cynthia Giles, an enforcement officer at the EPA, told reporters in a teleconference.

The cars, all built in the past seven years, are the VW Jetta, Beetle, Golf and Passat models, as well as the Audi A3.

Volkswagen has ordered an external investigation after USA regulators found that software the carmaker designed for diesel cars gave false emissions data, its CEO said today, adding he was “deeply sorry” for the violation of United States rules. VW must recall all the cars, remove the defeat device and improve the cars’ NOx emissions, which creates smog and has been linked to increased asthma attacks and other respiratory illnesses.

Volkswagen CEO Martin Winterkorn said Sunday the German automaker is launching an investigation into how it violated US emissions laws in selling almost 500,000 cars since 2009 with software that allowed it to “cheat” emissions tests.

“We do not and will not tolerate violations of any kind of our internal rules or of the law”, Winterkorn said, adding the company was fully co-operating with the relevant agencies.

When confronted with the EPA and Carb’s evidence, VW admitted that its cars were fitted with the “defeat device”. He said the charges undercut industry rhetoric about “clean diesel” cars. The California Air Resources Board is also investigating.

The Volkswagens likely perform better with the emissions controls defeated than they do with them on, said Aaron Bragman, Detroit bureau chief for the Cars.com automotive shopping and research site.

The software workaround might have been what enabled the performance without the expected pollution controls, he said. The agency ordered VW to fix the cars at its own expense.