Volkswagen Accused Of Hacking 482,000 Diesels To Fake U.S. Emissions Tests

A Volkswagen turbodiesel engine

The U.S. Environmental Protection Agency and California officials say some 482,000 Volkswagen and Audi diesels were engineered to falsify their emissions for federal tests—a violation that opens the German automaker to a theoretical fine totaling $18 billion.

The EPA and California Air Resources Board say the affected models had software in its computer engine controls that could sense exactly when it was being tested for emissions quality. At all other times, it would run the diesels in a different mode with illegal levels of pollution; for example, spewing up to 40 times more nitrogen oxide, a key component of smog, than allowed.

While other automakers have been accused of violating the Clean Air Act, this is the first time one has been found to have designed software specifically to circumvent the rules. The notice issued by the EPA and CARB today was the first step in a process that will likely lead to a recall of the affected models with 2-liter turbodiesel engines by VW; the agencies told owners that the vehicles are still safe to drive.

The affected cars include VW Jettas, Beetles, Golfs and Audi A3s with diesel engines from the 2009 to 2015 model years, along with diesel VW Passats from 2014-2015.

“Using a defeat device in cars to evade clean air standards is illegal and a threat to public health,” said Cynthia Giles, EPA Assistant Administrator for the Office of Enforcement and Compliance Assurance.

Volkswagen issued a statement saying it was cooperating with the agencies and would have no further comment today.

Under the Clean Air Act, each vehicle sold could be counted as a violation with a maximum fine of $37,500 apiece. Unlike with U.S. safety defect probes, there is no legal cap on the maximum fine a company can face for violating clean-air laws. Last year, Hyundai and Kia paid $100 million, and gave up clean-air credits valued at $200 million, for inflating fuel-economy numbers on more than 1 million vehicles.

As described by the EPA and CARB, the Volkswagen violation was no accident. In May 2014, researchers at a West Virginia University lab found higher-than-allowable levels of emissions during testing of a 2013 Passat and 2014 Jetta diesel. When asked by the agencies, VW said the differences were due to testing flaws and how the vehicles were being driven.

CARB ran its own follow-up tests, and continued to find irregularities. VW issued a preliminary recall in December 2014, but testing still found high pollutant levels. Only after the agencies threatened to withhold certification for VW’s 2016 model-year diesels—which would have kept them from going on sale—did the automaker reveal the presence of the software switch.

That switch had two modes, which VW calls “road calibration” and “dyno calibration.” Only in “dyno” mode, which monitored for the precise conditions EPA and other agencies would use to test emissions, do the engine’s full emission controls go into effect. At all other times, the diesels’ software uses the “road” mode.

VW has long touted its position as the biggest seller of diesel passenger cars and SUVs in the United States, collecting several awards for their ecological benefits, and promoting their “clean diesel” technology. So far this year, VW has sold about 49,000 diesel-powered vehicles, most with the 2-liter engine in question.

U.S. emissions rules for diesel passenger cars and light-duty trucks were the toughest in the world around the time VW sold these engines. While other automakers rely on an expensive system known as urea injection to manage the pollutants from such cars, VW has long maintained it was able to meet U.S. rules for its 2-liter turbodiesel engines without that setup; it does use them on its larger diesels. The question may be whether VW’s eventual fix will be a software-only update, or something more expensive to bring its engines back under the limit.