Just a year after Volkswagen's diesel scandal was discovered, an American regulator finds yet another cheating software installed in some Audi cars, demonstrating that the scandal is far from being over for VW group.
Germany's Bild am Sonntag reported this weekend that the California Air Resources Board found software that manipulated the amount of the carbon dioxide emissions in several Audi (NYSE AMEX: Nevsun Resources [NSU]) vehicles. Interestingly, the device found in Audi cars was not the same as the one that triggered the crisis of Audi's parent company Volkswagen last year with over 11 million cars affected.
The newspaper added that the software was designed to lower the carbon dioxide emissions when it detected that the car was under test conditions. More specifically, the software analyzed the position of the car's steering wheel that it used as a main indicator: if the wheel was not turned, pointing at laboratory testing conditions, the software activated the program that made the car produce less carbon dioxide than during a normal drive on a road. In turn, if the wheel was turned by more than 15 degrees in any direction, the software was automatically switched off to provide a better driving experience.
Reuters reported that the car manufacturer ceased using this software in its newly produced cars this May, just a few months before the CARB discovered it. Most likely, the cheat program was used in older Audi A6, A8 and Q5 models distributed in Europe, say the experts. For Audi, as the main profit-driver of VW group, being in the spotlight of yet another emissions manipulations controversy could become a very big problem.
The news come right at the moment when Volkswagen (XETRA: Volkswagen [VOW3]) finally seems to take hold of the numerous lawsuits after the U.S. regulators uncovered Volkswagen's decade-long manipulations of emissionы tests that costed the company over $20 billion. The analysts called the diesel controversy the worst period in the entire company's history.
“The consumers are absolutely being made whole. There is no question that Volkswagen has stepped up and said, ‘We cheated you, we sold you a product that not only was defective, but we sold it to you under false pretenses,’” Steve Kalafer, the chairman of Flemington Car & Truck Country told LA Times.
After the Sunday's of Bild am Sonntag report, the European regulators have sent multiple inquiries to their American counterparts asking to provide them full information on the statement they made that could heavily affect Audi and the entire auto industry if proven to be true. The Wall Street Journal reported that Germany's Transport Minister Alexander Dobrindt asked the federal motor transport authority to conduct their own assessment based on the data provided by the CARB. Likewise, European Commission was also negatively surprised by the news, with the Commission for Internal Markets and Services inquiring further clarification from California Air Resource Board. All authorities involved in the case as well as Audi itself declined to give any comments on this.
By secretly manipulating how VW group's Audi cars performed in test conditions as compared to the normal road situations, the company managed to effectively market its diesel engines without sacrificing the actual performance on the road. Unfortunately, this is not exactly how it works with the authorities. The official confirmation of the California Air Resource Board statement is expected to come in the next few days.