EPA: 482K VW diesel vehicles violated emissions rules

Washington — Volkswagen AG deliberately evaded federal emissions requirements in nearly a half-million diesel cars in the U.S. since 2009 by writing vehicle software to only activate anti-pollution controls during testing, regulators said Friday.

The device allowed the German automaker to evade requirements in selling 482,000 diesel 2009-2015 Volkswagen Jetta, Passat, Sportwagen, Beetle and Audi A3 cars with 2.0-liter engines, and let them to emit 10 to 40 times allowable pollution, environmental officials allege. That action, they said, is illegal and a public health threat.

The Environmental Protection Agency and California’s Air Resources Board said VW violated federal law and, in theory, could face fines of up to $18 billion — $37,500 per vehicle — as well as criminal prosecution. Both agencies issued notices of non-compliance to VW Friday, a step necessary before ordering a recall.

In a statement, VW said it is cooperating with the government, but didn’t say if it has admitted wrongdoing. The automaker is on track to surpass Toyota to become the world’s largest automaker this year. On Friday, the company removed many videos from YouTube and other social websites touting its clean diesel efforts.

Christopher Grundler, director of the EPA’s Office of Transportation of Air Quality, said in an interview 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.

Most U.S. VW dealers don’t have any remaining 2015 diesel cars to sell. VW is barred from selling those vehicles until “they get answers to the questions of how these vehicles are being operated. Volkswagen couldn’t explain why we’re getting these excess emissions,” Grundler said.

Grundler said it is “incomprehesible” how the world’s largest automaker could install “defeat devices” to evade emissions requirements. He said the EPA doesn’t know if VW will be able to fix the problem with a software upgrade, or needs to make a mechanical fix.

The agency said the vehicles’ software intentionally detects when the car is undergoing official emissions testing, “and turns full emissions controls on only during the test.” When vehicles are being driven normally, the computer disables the emissions controls.

Analysts speculated that there are only two advantages to such a device: VW may have wanted to get higher fuel economy for the cars or avoid more expensive emissions controls like those on larger diesel VWs built during the timeframe.

The announcement is a big setback to the German automaker, which has made diesels a big part of its U.S. strategy. Diesels last year accounted for nearly 22 percent of VW-brand U.S. sales. Friday’s announcement came as VW plans a high-profile event in New York City on Monday with singer Lenny Kravitz to show off its new Passat.

The Justice Department is likely to open a criminal investigation, if it hasn’t already.

The EPA said it “expects to compel VW to issue a recall in the future to reduce the emissions impacts of these vehicles. Depending on the complexity of the repair and the lead time needed to obtain the necessary components, it could take up to a year to identify a fix, develop a recall plan and issue recall notices.

The EPA won’t take any action to prevent owners from driving their vehicles before a fix is available.

Cynthia Giles, assistant administrator for the Office of Enforcement and Compliance Assurance, said the violation was serious. “We expected better from VW,” she said.

“Using a defeat device in cars to evade clean air standards is illegal and a threat to public health,” she said. “EPA is committed to making sure that all automakers play by the same rules. EPA will continue to investigate these very serious matters.”

Auto pollution, the EPA said, has been linked to serious health issues, including asthma and other 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.

VW issued a recall in December for nearly 500,000 vehicles that was supposed to address the emissions — but EPA said it didn’t work.

Friday’s development raises questions if other automakers, including General Motors Co., BMW AG and Mercedes-Benz USA, were harmed because they had to follow diesel emissions rules.

The EPA said it is looking to see if other automakers are breaking the rules with diesel vehicles.

California and U.S. agencies “have begun procuring in-use diesel vehicles produced by other manufacturers to screen the vehicles for possible defeat devices. Moving forward we will be reviewing our compliance protocols and introducing ways in which we can effectively test not only for emissions performance but also for the potential presence of defeat devices,” EPA said in a statement to The Detroit News.

Ellen Bloom, senior director of federal policy and the Washington office of Consumers Union, the parent of Consumer Reports, said Volkswagen “was ripping off the consumer and hurting the environment at the same time.

“We applaud the EPA and California for cracking down on Volkswagen. These actions send a powerful message that if a carmaker uses technology to get around the rules, regulators are going to come down hard on you for breaking the law.”

Consumer Reports suspended its “Recommended” of two VW vehicles: the Jetta diesel and Passat diesel. They will remain suspended until the magazine can re-test the cars vehicles with a recall repair performed.

The EPA declined to say if it has made a criminal referral to the Justice Department, or whether senior level executives were involved.

This is the latest example of automakers not following fuel-efficiency and emissions rules. EPA has imposed major fines and investigated overstatements on fuel efficiency. Last year, Hyundai and Kia Motors Corp. agreed to a record-setting $360 million settlement for overstating fuel economy ratings. The agreement ended EPA’s two-year investigation into the automakers' overstatement of mileage ratings for 1.2 million 2011-13 U.S. vehicles.

The VW emissions issue came to the attention of EPA in 2014 after independent analysis by researchers at West Virginia University, working with the International Council on Clean Transportation, a non-governmental organization, raised questions about emissions levels.

DShepardson@detroitnews.com