Wednesday, September 23, 2015

The Power of German Engineering?

Volkswagen became the latest automaker to get in trouble with the U.S. government and with consumers, after GM's ignition switch problems, Ford's inflated fuel economy ratings, and Fiat Chrysler's light-truck recalls (which I commented on back in August).  But to say that Volkswagen has a serious problem is like saying that Heidi Klum has pleasant features.
It seems that the Environmental Protection Agency (EPA) and the California Air Resources Board found out that Volkswagen installed a computer algorithm in its Turbo Direct Injection (TDI) diesel engine that activates the engine's pollution-control device only when the engine is undergoing emissions testing but turns it off  in regular everyday driving.  The result is that VW's "clean diesel" engine emits nitrogen-oxide pollution at a few times above the legal limit in the U.S.  Well, actually forty times the legal limit . . .
In other words, VW cheated in emissions testing.  The company basically lied about just how clean its "clean diesel" technology was.  The reality is that it's no better than the technology in standard diesel engines.  And this has been going on for a little while.  Well, at least seven years . . ..

In fact, it's been going on for as long as Volkswagen's current TDI engines have been available in the United States.  In 2007, the EPA enacted stricter nitrogen-oxide emissions guidelines, forcing the German automaker to pull its TDI-powered cars from its lineup. (Some observers have suspected that Detroit pushed for these standards not out of concern for the air but to eliminate competition; alas, GM and Chrysler went bankrupt anyway.)  Volkswagen re-introduced the TDI option a couple of years later with an all-new version of the engine, and to great fanfare, stating - incorrectly, of course - that the new TDI burned cleaner than before.  And it sold a few thousand cars with this engine from 2009 to 2015.  Well, actually, over 480,000 cars . . .
The government is likely to fine VW, based on the number of diesel cars sold since 2009, hundreds of millions of dollars. Well, actually eighteen billion dollars . . . 
And how has Martin Winterkorn, the CEO of Volkswagen AG, handled this so far?  Here's his statement of contrition:
"The U.S. Environmental Protection Agency and the California Air Resources Board revealed their findings that while testing diesel cars of the Volkswagen Group they have detected manipulations that violate American environmental standards. The Board of Management at Volkswagen AG takes these findings very seriously. I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case. Volkswagen has ordered an external investigation of this matter. We do not and will not tolerate violations of any kind of our internal rules or of the law. The trust of our customers and the public is and continues to be our most important asset. We at Volkswagen will do everything that must be done in order to re-establish the trust that so many people have placed in us, and we will do everything necessary in order to reverse the damage this has caused. This matter has first priority for me, personally, and for our entire Board of Management."

Herr Winterkorn had been the leading Volkswagen executive for technological development before he became chairman in 2007, the same year TDIs were banned in America, and oversaw the development of the current TDI as chairman.  Why wasn't this a first priority for him already?   And how could he not have known about this?
If there's a bright side to all this (and believe me, I know I'm stretching it here), it's that the affected cars are safe to drive, and the recall we know is coming might not be as hard for VW diesel-car owners to deal with.  Also, Volkswagen is committed to cooperating fully with any investigations of the matter, and Volkswagen of America president Michael Horn has not tried to sugar-coat any of this; he's said that VW has "screwed up."  But this situation is pretty bad when you have all those cars out there adding more climate-change-pollutants into the air than previously thought. Ans there are investigations expected elsewhere - not just in Germany but other countries such as France and South Korea.  
And that's not all.  Volkswagen made a selling point of its diesels for their performance and fuel economy as part of a strategy for the U.S. and Canada devised by Winterkorn himself, and despite the fact that diesel fuel is more expensive than gasoline in the United States (if you can remember when diesel fuel was cheaper than gasoline in the U.S., you're showing your age), so many Americans were willing to pay a little more at the pump that diesel-powered cars have accounted for as much as a quarter of VW sales in America, and they've become the backbone of VW's market strategy in this country.  VW has not only likely lost customers it will never get back, it may have lost several potential customers who may have only been considering a gasoline-powered Volkswagen as their next car.  Meanwhile, U.S. sales of VW's diesel cars have been suspended.  This comes at a time when VW is trying to regain vital market share after offering products out of step with the tastes of all but the most die-hard Europhiles and VW enthusiasts in the U.S.  I don't know if this means the beginning of the end for Volkswagen in the United States, but it sure feels like it.  Predictions of VW's demise in the U.S. have always turned out to be wrong, but I'm not so sure this time.
My 2012 Golf is a gasoline-powered car, with the 2.5-liter five-cylinder engine  - the "fiver,"  I call it - that was recently discontinued (cars affected are the diesel versions of the Golf, the Jetta, the Passat, the current Beetle and the New Beetle, and also the Audi A3), so I'm not affected by this.  But I'm bitterly disappointed in a brand I've trusted for years, a brand I've been loyal to since I bought my first new car (another Golf) in the year 2000 and had revered back when I owned a 1972 Super Beetle.  I remain loyal to Volkswagen, though, because I still find their cars superior to the competition.  But if Volkswagen wants to remain relevant in the United States - indeed, if it wants to remain in the U.S. market - than Herr Winterkorn had better live up to his pledge to set things right.  Especially when he let things go horribly wrong in the first place.  It isn't going to be all peaches and diesel (apologies to Eric Clapton) for him.

1 comment:

Steve said...

Update: Martin Winterkorn has resigned as VW chairman.