VW and the EPA

News | September 21st, 2015 by 7
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It was announced the other day that almost 500,000 VW and Audi TDI cars have been equipped with, ahem, inappropriate software. The software in question …

It was announced the other day that almost 500,000 VW and Audi TDI cars have been equipped with, ahem, inappropriate software. The software in question was included in the ECU code and allowed the cars to modify their emissions behavior based on a number of empirical readings.

Basically VW inserted code that looked for the start of an emissions test (which have very specific and readily identifiable characteristics). The code would then put the diesel engines into full emissions compliance mode. But once the test cycle was completed, they would return to a default mode that offered better performance, but a different emissions signature.

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The EPA can fine VW over $37,000 for each vehicle – resulting in a fine that would be around $18 Billion (that’s billion, with a ‘B’). Eighteen billion dollars could be used to create a few vehicle platforms, maybe 6 or so, with each platform having 6 or so models based off them. If the EPA does go for the max fine, look out.

Also worth noting, VW’s cash-on-hand at the end of 2014 was right $20 billion – so VW could pay the fine ‘out of pocket’ possibly but that’s a big hit to their cash flow buffer. This is all speculation currently, but it bears watching. Left unsaid is the possibility of criminal charges.

Regardless, this is something to keep an eye on, but . . . in the grand scheme of things, how is this substantially different than being able to put a car into Eco Pro, Comfort, Sport or Sport Plus modes? And who else is ‘gaming’ the EPA testing?

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