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VW’s Information to the Transport Select Committee Now Available

By National Practice Group Leader, Group Litigation

Volkswagen updated the Transport Select Committee regarding the emissions scandal before Christmas. The information for concerned car owners is now available.

Vw

1. VW have admitted that software was fitted to certain vehicles which enabled those vehicles to recognise when they were being tested, but they do not admit that the software fitted to cars in the EU amounted to a ‘defeat device’. However, VW accept that the software fitted to cars in the USA is a defeat device.

2. Jones Day, the firm appointed by VW to carry out the investigation as to what the software was designed to do and why, will continue to investigate this issue until well into 2016 before reporting back on their findings.

3. Although VW do not consider the software they fitted to be a ‘defeat device’, the KBA (the German regulatory authority) disagrees and says the software should be removed. The software update will, therefore, make sure that your car meets the NOx emissions levels during testing. Furthermore, VW are intending to update your car’s software in relation to ‘after treatment’ systems which they say will improve NOx levels.

4. VW say the fixes will be carried out free of charge and will be capable of being scheduled as part of an annual service, or a separate service if required.

5. VW is also ‘looking at’ a range of mobility options to minimise customers’ inconvenience which will be free of charge ‘where appropriate’.

6. Although VW is still unable to confirm that the fixes will not impact fuel economy or performance, they state that this nevertheless remains a goal and that they are ‘optimistic’ that performance and fuel economy will not be adversely affected. They say they will be transparent in relation to test results in relation to this.

7. VW has confirmed it will not offer UK owners goodwill payments despite making them available to American owners. This will not impact on a UK owners’ ability to claim compensation should you suffer a loss following the fixes.

The reason for the difference in attitude towards UK owners was put down to the following:

a. UK owners will have solution to the issue faster than those in the USA, and this will be implemented sooner;

b. The fixes should have no impact on performance and fuel consumption;

c. As the fix is ‘just around the corner’ VW consider it is better that the money is spent rolling out the fixes rather than paying a gesture of goodwill to you;

d. The impact of the scandal has been more pronounced in the USA where diesel accounts for 3 per cent of the market, so there is a need to foster loyalty to diesel engines, and this is not the case in the UK.

Slater and Gordon’s Thoughts on the Latest News

It is clear that VW is coming under considerably more pressure in the USA than it is in the UK/EU following this scandal and that this is feeding through to VW’s approach to its UK customers.

So far, the authorities in the USA have accused VW of not co-operating with their investigations and have rejected VW’s plan to fix affected cars as they were not convinced that the plans adequately addressed the impact on fuel consumption and performance issues, and were not going to be rolled out fast enough. Furthermore, the US Justice Department has launched a legal action against VW in relation to violations of the Clean Air Act which could leave VW facing fines of $46billion.

In contrast, authorities in the EU have seemingly agreed to the proposed fix without too much difficulty. Due to the softer regulatory regime in place within the EU they are unable to impose penalties on VW in relation to the emissions scandal, but we understand that this is now being looked at.

What’s more, we are now in a position where VW are not even admitting that the software fitted to your vehicles amounts to a ‘defeat device’ or that they were intending to cheat emissions testing in this jurisdiction. This is wholly at odds with their position in the USA where they have accepted exactly that. It is expected that they are positioning themselves in relation to any future claims which may be brought against them in the UK, as by denying liability they place a hurdle in front of claimants, thereby making recovering any loss that bit harder.

The treatment of owners of affected vehicles in the USA compared with the UK is also something which we consider to be extremely unfair. VW is offering goodwill payments to US owners and is implementing a buy-back scheme for some of the affected cars. However, as explained above, none of this appears to be on offer to you. The claim that the fix is ‘just around the corner’ is unlikely to be of much comfort, especially if you own a 1.6 litre vehicle and have to wait until at least week 39 of 2016 to begin to have the fix rolled out. We were also disappointed to see VW claim that goodwill payments are justified in the USA as a means of fostering loyalty to diesel technology. It seems more likely to us that the goodwill payments were offered in the USA as there are far fewer consumers there, and the fines are far higher than in the UK.

Cynics in the media suggest that there also appears to be a political sub-plot to this issue, namely that it is claimed that the US is looking to damage VW’s American business as much as it can to bolster its own domestic car manufacturing industry which has been on the decline recently. Conversely, the German authorities would appear to not want this scandal to impact too heavily on VW as they are quite reliant on the motor industry themselves.

It appears to us that what is being missed is that UK consumers have seemingly been misled as to what they were buying. Consumers have been driving highly polluting cars for several years, have had to wait up to a year to have them fixed, cannot be assured that the cars following the fix will not suffer a fall in performance, fuel consumption or resale value, and in the meantime, we are being told, are not being offered trade-in values for their cars by VW branded dealerships, meaning they are stuck.

Claiming Against Volkswagen

We are still interested in hearing from any Volkswagen, Audi, Seat, Skoda, Porsche or Bugatti owners that have been affected by the emissions scandal.

Please register your details on our VW Emissions Scandal Investigation page.

Jacqueline Young is Head of Group Litigation at Slater and Gordon Lawyers UK.

Follow Jacqueline Young on Twitter for live updates on the VW scandal.

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