Probe Of Emissions Cheating By All Manufacturers Considered

European officials are calling for a wider probe of emissions cheating by manufacturers

The Volkswagen emissions cheating scandal is like the eggplant that ate Chicago; it just keeps getting bigger all the time. The company now says the software at fault was installed in 11 million cars worldwide, prompting calls from several European nations for a probe of emissions cheating by all manufacturers.

German officials called for investigations into Volkswagen to be widened to include the entire auto industry as regulators begin to ponder whether such deception is more widespread. The state of Lower Saxony, a major Volkswagen shareholder, with 20% of the carmaker’s voting stock, said Tuesday that the emissions allegations raised doubts about tailpipe data published by all carmakers.

For its part, France is also calling for a broader probe, suggesting a European-wide examination of the auto industry. “We need to do it at the European level,” French Finance Minister Michel Sapin said. European Union regulators will meet with national authorities “very soon” to discuss how to address Volkswagen’s emissions crisis, an EU spokeswoman said on Tuesday.

The spokeswoman stressed that, while the EU has a role in defining emission limits for cars, national authorities are responsible for enforcing those limits and the associated test procedures. “That is a matter for the member states, who have all the tools they need,” she said. “We are there to provide the necessary political impulses.”

According to the Wall Street Journal, Italy’s Infrastructure and Transport Ministry said it is requesting information from both Volkswagen and Germany’s Federal Motor Transport Authority, which approves vehicles both for the domestic market as well as other European countries. “The ministry is asking to know if the offense that occurred in the U.S., where there are different approval rules, was carried out also on approvals done by the German authority for Europe and if the vehicles were sold in Italy,” the Italian ministry said in a statement.

Not to be outdone, South Korea has now also jumped on the bandwagon. According to Fox News, Park Pan-kyu, a deputy director at South Korea’s environment ministry, said Tuesday that four models — Golf, Jetta, Beetle, and Audi A3 — are subject to the probe, expected to end in November. About 6,000 vehicles made in 2014 and 2015 were sold under those nameplates in South Korea.

The scandal has sent Volkswagen stock prices down almost a third since last Friday, but shares of other European carmakers have been punished as well. Daimler, BMW, and French carmakers Renault and PSA Peugeot Citroën have also suffered sharp stock declines since the EPA announcement.

Few people think Volkswagen CEO Martin Winterkorn can survive the scandal. The real question is, can Volkswagen itself survive? The fines, penalties, and legal claims against it from disgruntled customers could be a crushing blow to the company’s finances. And here’s a thought for today: If Volkswagen should decide to shutter some of its North American operations, could an opportunistic competitor — like Tesla, Apple, or Google — be interested in acquiring a complete vehicle manufacturing facility for pennies on the dollar? There’s a good chance that possibility is already being discussed in several boardrooms, all of them in California.

Steve Hanley

Closely following the transition from internal combustion to electricity. Whether it's cars, trucks, ships, or airplanes, sustainability is the key. Please follow me on Google + and Twitter.