Following the big news last week that the Environmental Protection Agency in the US had uncovered special software inside diesel-powered Volkswagens sold there could "defeat" emissions testing, making them appear compliant with clean air standards when they are not, Volkswagen board chairman Martin Winterkorn issued an apology and this week resigned.
“The U.S. Environmental Protection Agency and the California Air Resources Board (EPA and CARB) revealed their findings that while testing diesel cars of the Volkswagen Group they have detected manipulations that violate American environmental standards.
“The Board of Management at Volkswagen AG takes these findings very seriously. I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case. Volkswagen has ordered an external investigation of this matter.
“We do not and will not tolerate violations of any kind of our internal rules or of the law.
“The trust of our customers and the public is and continues to be our most important asset. We at Volkswagen will do everything that must be done in order to re-establish the trust that so many people have placed in us, and we will do everything necessary in order to reverse the damage this has caused. This matter has first priority for me, personally, and for our entire Board of Management."
In the meantime, affected cars are not being sold until Volkswagen can update the software.
Volkswagen Group is an enormous, global corporation, it's certainly within the realm of reason that cheating emissions standards is a decision that would be made without Dr Winterkorn's direct approval, but considering the gravity of the allegations, he has done the right thing to resign.
In the short term, though, Volkswagen's problems are only going to get worse: it will almost certainly have to recall around a half million cars, which may be unable to meet emissions standards without cheating and that's just in the United States.
Reuters reports that the fines for those vehicles alone could add up to $18 billion, unless VW cuts some kind of deal.
As chair of the Volkswagen Group, Martin Winterkorn previously had urged European regulators not to overburden the automotive industry with excessive emission targets, citing a lack of time to develop fuel-efficient technology and the economic downturn as major concerns.
The topic was especially close to Winterkorn, who vowed to make the company the biggest electric carmaker in the world and put 1 million electric vehicles on the road by 2020.
The German carmaker owns brands including Volkswagen, Audi, Bentley and Lamborghini.
Dr. Winterkorn commented on his resignation by adding “I am doing this in the interests of the company even though I am not aware of any wrong doing on my part.”
The blame for 'DieselGate' fell squarely on Winterkorn’s shoulders, but the seeds for his departure were sown five months ago as in April, Winterkorn survived a challenge from then-Chairman Ferdinand Piëch.
VW’s Board must act quickly to add a leader to replace Winterkorn. Under his leadership, VW was transformed from a German car company to a global powerhouse that sold nearly as many cars in China in the first 8 months of 2015 as it did in all of Western Europe.
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