While the rapid-fire news cycle regarding Volkswagen's diesel emissions scandal may have slowed slightly, behind-the-scenes proceedings have not.
The Justice Department sued Volkswagen on Monday over emissions-cheating software found in almost 600,000 diesel vehicles sold in the United States.
EPA Assistant Administrator for Enforcement and Compliance Assurance Cynthia Giles said the lawsuit would hold Volkswagen accountable and set the case on a "path to resolution". The software allowed the engines to burn more cleanly when the vehicles' computers detected that an emissions test was underway. Despite passing testing and receiving clean emissions credentials, the German carmakers' diesel vehicles were actually emitting up to 40 times more pollution than is allowable under US standards. "The U.S. will pursue all appropriate remedies against Volkswagen to redress the violations of our nation's clean air laws alleged in the complaint".
It was in Sept when Volkswagen first admitted that they installed cheat devices on their several 2.0 liter diesel units, but the lawsuit insisted that the firm failed to reveal about the their other models that were installed with the particular device. But it took an EPA investigation against Volkswagen launched last September to turn a niche concern into a scandal.
Volkswagen said it would recall 8.5 million cars in Europe, including 1.2 million in the United Kingdom, and 500,000 in the US. A raft of private class-action lawsuits filed by angry VW owners also is pending.
The Wall Street Journal quoted ING as saying in a research note: "We [previously] assumed around €12bn ($13bn) in fines, we are not convinced yet that the number will be significantly above this when a final settlement is reached". The company could still face separate criminal charges and is negotiating a massive recall with us regulators.
The move came in a federal court in Detroit, where prosecutors acting on behalf of the Environmental Protection Agency accused Volkswagen of a systematic effort to evade the environmental regulations enshrined in the 1963 Clean Air Act (the law has been subsequently amended). It only said Monday night it was carefully studying the civil suit and would continue to cooperate fully with U.S. authorities.
