By Amanda Balbi
December 1, 2015

In September, Volkswagen admitted to “cheating” on U.S. government emissions tests for nitrogen oxide. As a result of an internal investigation, the company now says that there are “unexplained inconsistencies” in the carbon dioxide emissions tests as well. The unethical activity was uncovered when the International Council on Clean Transportation (ICCT) and Environmental Protection Agency (EPA) discovered discrepancies between emission test results and road-test results.


Software installed in Volkswagen cars with four-cylinder diesel engines would turn on pollution controls during controlled driving tests in order to pass, but the software would shut off the controls during real-world driving, releasing the pollutants.


The scope of the fraud has expanded to include six-cylinder Volkswagen, Audi, and Porsche vehicles.


Eleven million cars worldwide have been recalled since September, and another 800,000 could be recalled by the end of the year. Also, Volkswagen has to pay large fines equaling nearly $10 billion, has suffered damage to its reputation, and has seen a steep decline in stock price.


Although then-CEO Martin Winterkorn resigned after the scandal surfaced, no company officers have been criminally charged.



10 million Volkswagen vehicles were delivered in fiscal year 2014.


Source: Volkswagen, “Moving Progress: Annual Report 2014,” March 2014, http://annualreport2014.volkswagenag.com


Amanda Balbi is copy editor of Strategic Finance magazine. You can reach her at abalbi@imanet.org.
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1 comment.
    CoLleen Hyman December 6, 2015 AT 1:27 pm


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