EPA accuses Volkswagen of cheating Clean Air Act, orders recall.
Volkswagen has been cheating federal emission standards since 2008, spewing as much as 40 times more pollution than allowed by equipping its cars with a “defeat device” that fools the official test, the Obama administration said on Friday.
Volkswagen AG’s admission that it cheated to make its diesel cars appear cleaner-burning than they are leaves the automaker facing billions in fines, its executives risking criminal charges and its U.S. expansion plans in tatters.Volkswagen called them “clean diesels,” branding them as the fun-to-drive alternatives to hybrids as it dominated the U.S. market for the engine technology.In ads, Volkswagen touted its popular Jetta and Beetle diesels as paragons of clean-fuel technology: Buyers were promised a car that was “clean, fuel efficient, and powerful,” according to one 2013 testimonial. VW admitted systematically cheating on U.S. air pollution tests for years, the Environmental Protection Agency announced Friday in citing violations that could add up to $18 billion in fines. The agency alleges that the German automaker’s vehicles have a sophisticated algorithm that was designed to undermine official emissions testing by engaging full emissions controls only during testing and disabling them afterward.
Turns out the increasingly eco-conscious buyers of the sporty German cars have been unwittingly pumping smog into the air — because of software VW installed to cheat on U.S. emissions tests. The company said it has also heard from the Justice Department, which the EPA said could pursue criminal prosecution. second-biggest car market with a strategy built in part on touting the efficiency of fun-to-drive “clean diesel” vehicles now shown to be anything but. “It’s a huge black eye for Volkswagen,” said Matt DeLorenzo, managing editor for news at Kelley Blue Book in Irvine, California. As a result, the car maker was able to sell half a million diesel-powered vehicles that produce nitrogen oxide, which creates smog, at up to 40 times the legal limit during normal driving situations. On Friday, the agency issued Volkswagen AG, Audi AG and Volkswagen Group of America (collectively VW) with a notice of noncompliance with the federal law – the so called Clean Air Act, designed to control air pollution on a national level. The EPA learned about the issue only last year after researchers at West Virginia University published a study revealing that VW cars had emissions higher than expected.
In a probe the EPA established that VW “manufactured and installed defeat devices in a certain model year 2009 through 2015 diesel light-duty vehicles with 2.0 liter engines,” the agency said in the notice. The EPA joined California state officials in accusing the German automaker of deliberately circumventing air-pollution laws with the use of a software “defeat device” installed on nearly 500,000 Volkswagen and Audi diesel models sold in the United States since 2008.
The EPA worked in conjunction with the California Air Resources Board to uncover the defeat device, which is described as a piece of sophisticated software embedded in the cars’ computer systems. Diesel versions of the popular Beetle, Golf, Jetta and Passat comprise more than a quarter of the brand’s sales in the U.S. and are a vital part of the company’s strategy for meeting tougher U.S. fuel economy standards going into effect in coming years. But two months ago, the EPA opposed some proposed measures that would help potentially expose subversive code like the so-called “defeat device” software VW allegedly used by allowing consumers and researchers to legally reverse-engineer the code used in vehicles. An EPA statement hinted of a future recall, saying it was “incumbent on Volkswagen to initiate the process” to fix the affected cars’ emissions systems. The software sensed when the vehicle was being tested for compliance with the regulations and ran a program that produced similar compliance emission results.
The issue involves the 1998 Digital Millennium Copyright Act (DCMA), which prohibits anyone from working around “technological protection measures” that limit access to copyrighted works. This challenges everything they’ve been saying about those vehicles.” “It’s just a blatant disregard and intentional manipulation of the system,” said Priya Shah, a San Francisco owner of a 2012 VW diesel Jetta station wagon. “Not only lying to the government, but also lying to your consumer. Nitrogen oxide is a major component of smog, or ground-level ozone pollution and particulate matter, which has been linked to asthma attacks and serious respiratory illnesses. VW’s competitors were spending more money on systems to comply with the law and help the environment. “My hope is the agency will send a strong message to the rest of the industry,” Oge said. “You want to make it clear that this isn’t acceptable.” The closest parallel to the Volkswagen case was a group of truck makers who used devices to suppress diesel-pollution controls to improve fuel economy, Oge said. The Library of Congress, which oversees copyrights, can issue exemptions to those prohibitions that would make it legal, for example, for researchers to examine the code to uncover security vulnerabilities.
People buy diesel cars from VW because they feel they are clean diesel cars.” Justin Balthrop, of Topanga, has driven four VWs over many years and just bought a 2015 Golf TDI because of its mix of performance and fuel efficiency. The affected diesel models include: Jetta (model years 2009-15), Beetle (model years 2009-15), Audi A3 (model years 2009-15), Golf (model years 2009-15), and Passat (model years 2012-15). Having access to car controls would allow for “good-faith testing, identifying, disclosing, and fixing of malfunctions, security flaws, or vulnerabilities,” they argued, according to comments they submitted to the Federal Register.
Various parties submitted three classes of proposed exemptions that would have potentially assisted in uncovering this type of software—the proposals have been categorized by the Copyright Office as Class 21, Class 22, and Class 25. The results were shared with EPA and discussed in conversations with company officials, who acknowledged that a software change accounted for the varying emissions rates. It could take up to a year for VW to develop a recall plan, regulators said, and in the meantime owners are told to keep driving as usual — and keep checking the mail for a notice from VW. The test manipulation “is illegal and a threat to public health,” said Cynthia Giles, assistant administrator for the Office of Enforcement and Compliance Assurance. “We expected better from VW.” Volkswagen admitted that the cars contained “defeat devices,” after EPA and the state air regulator demanded an explanation for the emission problems.
Of course, examining software in this way can potentially uncover other things a car maker wouldn’t want anyone to see, such as code designed to circumvent emissions testing. Someone at VW had to decide that cheating the system was going to be a better use of time, money and resources than meeting the regulatory requirements, Tynan said. In 1998, the EPA reached a $1 billion settlement with diesel-engine companies such as Caterpiller, Renault and Volvo for installing equipment that defeated emission controls. And legalizing public access to the software used in the 482,000 VW cars now being recalled could possibly have revealed the alleged “defeat device” code earlier.
As noted on Twitter by Thomas Dullien, a prominent security researcher and reverse engineer who goes by the handle Halvar Flake: “The VW case is an example why we need more liberal reverse engineering regulation. In a world controlled by code, RE creates transparency.” “It’s possible” a researcher with legal access to Volkswagen’s software could have discovered the code that changed how the cars behave in testing, says Matt Blaze, a professor in computer information science at the University of Pennsylvania. Air board investigators started testing the vehicles on a special dynamometer — a kind of treadmill for vehicle testing — and on the open road using portable equipment. A recall is really the only way to do that.” Volkswagen was deliberately creating more pollution for the people they were trying to sell clean diesels to, said Dan Becker, director of the Safe Climate Campaign, a Washington-based environmental group. “This is one of the companies that’s been trying to get Americans to buy diesels,” Becker said. “They’ve banked their future in a significant way on diesel.
Third party reverse engineering is a powerful tool, says Blaze, and could have turned up the “defeat device,” even if whoever found it didn’t know what they were looking at, or that it was deliberate. Officials did not specify VW’s motivation for cheating, but some benefits might be to increase real-world performance or fuel economy, Sullivan said. In addition to fines, VW will likely face consumer lawsuits on two fronts, said Steve Berman, a class action attorney in Seattle who has successfully brought such cases against Toyota, Hyundai among others.
Berman said he is already preparing a lawsuit on behalf of a Marin County, Calif. owner who bought a VW because it was marketed as a clean car and “now they find out it was polluting the environment at 40 times standards.” VW also will face what is known as a “diminished value” lawsuit because the vehicles are likely to lose a portion of their resale value because of the problem, he said. “Tightening government standards are making cars cleaner, and it is disturbing to learn that VW is flouting those standards,” Tonachel said. “The EPA action is important to protecting public health.” Consumers should not read VW’s action as an indictment of all diesel cars, said Don Anair, research director for the Clean Vehicles Program at the Union of Concerned Scientists. “There has been major progress in advancing emissions controls for diesels over the past 10 years,” Anair said. “That’s a fact.