Report: EPA To Force Volkswagen To Build Electric Cars In U.S. As Penance For Dieselgate Scandal

Back in September last year, the U.S. Environmental Protection Agency, operating alongside the California Air Resources Board, announced that they had found German automaker Volkswagen to be in wilful non-compliance with Part A of Title II of the Clean Air Act. Namely, that it had purposely fitted software defeat devices to certain model-year vehicles fitted with 2.0-litre TDI diesel engines. The purpose? To ensure vehicles met emissions requirements when tested on a dynamometer but emitted more than 40-times the legal limit for nitrogen oxides (NOx) when driven on the road.

The EPA wants Volkswagen to leave the dark side.

The EPA wants Volkswagen to leave the dark side.

Since the initial Notice of Violation from the EPA, more vehicles from the Volkswagen group have been found to be in non-compliance, including Volkswagen, Audi and Porsche models fitted with Volkswagen’s 3.0-litre V-6 diesel engine. Fines have slowly racked up and both the EPA and CARB have rejected Volkswagen’s plans to bring noncompliant 2.0-litre TDI engines into compliance.

Initially, it was expected that the EPA and CARB would force Volkswagen to carry out remedial work on each of the 600,000 affected non-compliant vehicles in the U.S. to bring them into compliance with the Clean Air Act. But at the end of last year, Tesla CEO Elon Musk and 44 other influential business leaders and environmentalists wrote an open letter to California Air Resources Board Chairman Mary Nichols, imploring her to release Volkswagen from its obligation to fix the hundreds of thousands of non-compliant diesel cars and instead force it to build large numbers of electric vehicles instead.

Volkswagen already produces cars like the Golf GTE in Europe. So why not the U.S.?

Volkswagen already produces cars like the Golf GTE in Europe. So why not the U.S.?

Now German-language newspaper Welt am Sonntag (via Reuters) says that’s exactly what the U.S. EPA is proposing as part of negotiations with the automaker over making amends for the dieselgate scandal.

While Welt am Sonntag’s original story did not quote its sources by name, it claimed on Sunday that the EPA was asking Volkswagen to produce large numbers of electric vehicles at its existing manufacturing facility in Chattanooga, Tennessee. At the same time, the paper claimed the EPA was also pushing Volskwagen to build a network of electric vehicle charging stations across the U.S. to facilitate longer-distance electric car travel.

Talking to Reuters yesterday, a Volkswagen spokesperson confirmed that it was engaged with ongoing talks with concerning dieselgate, adding that “we are not commenting on the contents and state of the negotiations.” The EPA declined to comment at all.

Volkswagen would rather fix non-compliant cars, it seems.

Volkswagen would rather fix non-compliant cars, it seems.

In a follow-up article published this morning however, Welt am Sonntag reported that negotiations have concluded — at least for now — between Volkswagen and the EPA, with Volkswagen executives returning “somewhat sobered” to Volkswagen’s headquarters in Wolfsburg, Germany. Referring to the negotiation process as being one in which two steps forward are made and one step backward, the newspaper claims that Volkswagen’s executives aren’t happy with the EPA’s proposals.

First of all, the newspaper explains, there’s the cost. Alongside retrofitting its Chattanooga plant for electric vehicle production — and training its staff — Volkswagen is unhappy about the extra money that it will need to spend to assist in the expansion of electric vehicle charging networks. But as Welt am Sonntag carefully notes, simply bringing the 600,000 or so non-compliant cars into compliance won’t make up for the massive amount of air pollution caused by those vehicles to date.

Building zero-emission electric vehicles would help displace the heavily-polluting non-compliant vehicles in a far more effective way, while improving electric vehicle choice for consumers. It’s worth noting too that while Volkswagen produces multiple different plug-in vehicles in Europe, including all-electric cars like the Volkswagen e-Golf and e-Up, it only produces the Volkswagen e-Golf and Audi A3 e-tron plug-in hybrid for the U.S. market.

Of the 600,000 affected cars in the U.S., Volkswagen believes around 100,000 vehicles are simply too tough to bring into compliance. Those vehicles will be purchased back from their owners. At the other end of the spectrum, some 50,000 cars can simply be brought in line with regulations via a software update. A further 350,000 will need a new catalyst to be installed in their exhaust system.

The Volkswagen BUDD-e proved Volkswagen can make a long-range EV. Now the EPA wants it to do just that, it appears.

The Volkswagen BUDD-e proved Volkswagen can make a long-range EV. Now the EPA wants it to do just that, it appears.

While this route is preferred by Volkswagen, this complex, haphazard solution doesn’t make the EPA or CARB feel particularly confident. Indeed, for each vehicle modification made, Volkswagen and the agencies involved will need to carry out extensive testing to make sure that each and every proposed fix will indeed do as Volkswagen claims.

With cash running out at Volkswagen, the automaker is naturally eager to pick the most financially beneficial option for its shareholders. But while it may view the building of new electric cars as less than ideal for company finances, we think Volkswagen’s proud display of the 200-mile Volskwagen BUDD-e concept car at last month’s Consumer Electronics Show most likely was the proof the EPA needed that the German automaker was more than capable of producing an electric car.

Given the EPA’s first duty is to protect the environment — including the air we breathe — it’s hardly surprising it now wants Volkswagen to make cars like the BUDD-e a reality, now is it?


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