Dieselgate: VW North America Boss Faces House Subcommittee, Has Few Answers to Give

Ever since the news broke that Volkswagen AG had purposely fitted its cars with hardware and software designed to cheat tough diesel emissions tests in Europe and the U.S., any form of personal association with Volkswagen has been tough, especially for those in employment at the German automaker.

But perhaps today nobody had it quite as tough as Michael Horn, CEO of Volkswagen North America, who faced tough questions at the hands of a House Energy and Commerce investigations subcommittee on Capitol Hill.

Michael Horn in happier times for VW.

Michael Horn in happier times for VW.

Horn, one of the few Volkswagen executives to survive the debacle thus far, took to the stand as politicians queued up to grill him on just how and why VW — and its sister brands — chose to show such blatant, calculated disregard for air quality while marketing its vehicles as ‘clean diesels’. More specifically, representatives on the subcommittee wanted to know exactly how Volkswagen proposed to fix the problem.

His prepared statement — which you can read here — tries hard to show Volkswagen in a proactive and responsible light. But Horn, showing visible signs of pressure under questioning, was unable to offer all of the answers the House Energy and Commerce investigations subcommittee were looking for. Despite being duly contrite, Horn had some bad news for the subcommittee: Volkswagen still hasn’t got a complete plan for fixing the 11 million affected cars worldwide.

Agreeing that it appeared someone at VW had decided to use the illegal software — which emitted 40 times the legal NOx limit when driven on the road but then entered into a special ‘testing’ program to ensure compliance with NOx limits when on a rolling road (dynamometer) — because it was the only way its EA189 engine could pass emissions tests without the installation of an expensive urea injection system, Horn was careful not to implicate any one person or team at the automaker. Instead, he reiterated his belief that the decision was not something Volkswagen consciously chose to do as a company.

“This was not a corporate decision,” Horn said, choosing to blame the cheating on a handful of software engineers. When pressed by a member of the subcommittee as to whether Volkswagen’s board of directors or senior management were aware of the problem, his reply acknowledged the situation Volkswagen was in.

“I agree it’s hard to believe,” he said.

Horn: early cars with the EA189 engine will require a costly refit.

Horn: early cars with the EA189 engine will require a costly refit.

Of his own awareness of the issue, Horn initially said he was not aware of any defeat devices installed in Volkswagen cars until the start of September, when he learned of an official EPA investigation into the emissions rigging scandal. The meeting, which took place on September 3, saw Volkswagen admit its intentional emissions transgressions to the EPA.

Horn may have only found out about the intentional defeat device days before VW admitted its existence to the EPA, but he said he first became aware that certain Volkswagen diesel models might not be meeting emissions targets last year — when a study by West Virginia University’s Center for Alternative Fuels, Engines and Emissions  discovered the NOx emissions of a diesel Passat being tested as part of a study were incongruous with official EPA figures for the car.

Later that year, Horn said he was told by Volkswagen’s Wolfburg headquarters that its engineers had a fix for the problem, and that the emissions experienced by WVU were caused by a using the car in a non-standard, test setting.

Now however, Horn acknowledges that outlook was incorrect.

“We are determined to make things right,” he continued. “This includes accepting the consequences of our acts, providing a remedy, and beginning to restore the trust of our customers, dealerships, employees, the regulators, and the American public.”

When questioned about what Volkswagen’s planned remedy for the situation, Horn detailed two different routes that Volkswagen is currently considering: a software reprogram for certain recent model-year cars, and a more costly retrofit campaign for older models.

Those older model-year cars — some 430,000 cars fitted with ‘first generation’ EA189 engines — would require fitment of a urea injection system alongside engine control module reprograming or fitment of more advanced catalytic converters to capture more NOx from the tailpipe, Horn admitted.  When questioned by a representative about the complexities of the retrofit campaign and how difficult that would be to accomplish, Horn said that Volkswagen has yet to finalize just how the retrofit campaign would work, but promised that Volkswagen would discuss its plans with the U.S. EPA and Californian Air Resources Board as soon as it was ready.

Cars fitted with the EA288 diesel engine (pictured) aren't affected.

Cars fitted with the EA288 diesel engine (pictured) aren’t affected.

Worse still, Horn said that Volkswagen could not yet provide a full timescale for the recall program, saying that it hopes to have a software update available for recent model-year cars fitted with the EA189 engine early next year. Hardware retrofits for older cars with EA189 engines would likely not be ready until the middle of next year or possibly a little later, he admitted.

In addition to facing tough questions about the engine control module, which Horn dodged by saying he wasn’t fully aware of how the defeat switch worked, Horn also faced a barrage of questions from representatives keen to know what Volkswagen intended to do to protect its customers and its dealers across the U.S.

As multiple representatives reiterated, many have been contacted by consumers angry that the retail value of their cars have plummeted in the past few weeks, leaving them stuck with a heavily-polluting car they can’t afford to sell. Others were contacted by auto dealers in their state, many of whom have rows of diesel-engined VW models they’re unable to sell but are costing them of thousands of dollars in interest payments alone.

As with the vehicles themselves, Horn could not provide the committee with a complete plan of how VW plans to proceed with either customers or dealers.

That won’t help Volkswagen’s reputation. Indeed, in addition to the estimated $39 million in fines for non-compliance with EPA and CARB regulations, Volkswagen could also be about to face another committee called by the Finance Committee of the U.S. Senate which could see it repay $50 million in Federal tax credits given to Volkswagen diesel customers in 2009 for buying a ‘clean diesel’ vehicle instead of a gasoline model.

In addition to the concerns over fixing the issue, Volkswagen is facing mounting fines.

In addition to the concerns over fixing the issue, Volkswagen is facing mounting fines.

The tax rebate, only available for the 2009 Federal Tax year, was amended to exclude diesel cars from 2010 onwards. But as our friends at GreenCarReports detail, Volkswagen even tried to get the rebate extended to diesel cars for 2009-2011 model year cars. telling officials at the EPA that its clean diesel cars were better than hybrids and far superior to electric cars.

As Former EPA official Marge Oge told the New York Times in a recent interview, Volkswagen’s senior executives were extremely arrogant when dealing with the government agency, calling electric cars a “waste of time.”

For  company which is now trying to portray itself as a prospective leader in electric cars by 2020, that statement is particularly two-faced.

We’ll keep you posted on the latest in the dieselgate scandal as we have it, including Volkswagen’s proposed solution for ridding the streets of some 11 million over-polluting cars worldwide.

In the meantime, if you’re affected by this scandal we’d like to hear from you. Are you a dealer frustrated by VW’s lack of actiion? Or perhaps you’re a customer with a car you no-longer want to drive?

Leave your thoughts in the Comments below.


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