Volkswagen cheated on emission tests with tricky software - EPA

Volkswagen AG has been caught installing cheating software on nearly half a million diesel vehicles. Now it has been slapped with a notice from EPA and may be fined $18 billion.

On Friday, the agency issued Volkswagen AG, Audi AG and Volkswagen Group of America (collectively VW) with a notice of noncompliance with the federal law – the so called Clean Air Act, designed to control air pollution on a national level.

In a probe the EPA established that VW “manufactured and installed defeat devices in a certain model year 2009 through 2015 diesel light-duty vehicles with 2.0 liter engines,” the agency said in the notice. Among the models with the devices are the Volkswagen Jetta, Beetle, Golf and Passat, and the Audi A3, it said.

The company could be fined up to $18 billion, according to EPA.

The software installed in the electronic control module (ECM) of 482,000 vehicles was designed to “bypass, defeat or render” inoperative elements of the vehicle’s emission controls, it said.

The software sensed when the vehicle was being tested for compliance with the regulations and ran a program that produced similar compliance emission results. However, the program was automatically deactivated in normal driving mode.

“The effectiveness of these vehicles’ pollution emissions control devices is greatly reduced during all normal driving situations,” EPA said.

“This results in cars that meet emissions standards in the laboratory or testing station, but during normal operation, emit nitrogen oxides, or NOx, at up to 40 times the standard. The software produced by Volkswagen is a ‘defeat device,’ as defined by the Clean Air Act.”

The federal agency said that exposure to the emissions has been linked to serious health issues, including various respiratory illnesses.

“Exposure to ozone and particulate matter have also been associated with premature death due to respiratory-related or cardiovascular-related effects. Children, the elderly, and people with pre-existing respiratory disease are particularly at risk for health effects of these pollutants,” EPA said.

“Using a defeat device in cars to evade clean air standards is illegal and a threat to public health,” said the EPA’s assistant administrator for the Office of Enforcement and Compliance Cynthia Giles on Friday.

“Working closely with the California Air Resources Board, EPA is committed to making sure that all automakers play by the same rules. EPA will continue to investigate these very serious violations.”

The state of California issued a separate notice to VW on Friday.

The California Air Resources Board and EPA were first alerted about the issue in May 2014 by researchers at West Virginia University. Following an investigation, in September 2014, VW admitted that the cars contained the devices, both agencies said.

In November 2014, Korean automakers Hyundai and Kia were ordered to pay a combined $300 million for violating the Clean Air Act. This was the largest fine penalty under the law announced for overstating vehicle fuel-economy standards on 1.2 million cars.