* Virginia - Did emissions violations just kill an OEM’s North American dreams?
-- Volkswagen shares tumbled Monday morning on the heels of news last week that the U.S. Environmental Protection Agency’s announcement that it was initiating a class-action lawsuit against the German automobile manufacturer. The suit alleges that Jetta sedans sold in in North America were equipped with emissions “defeat code” software: If the car’s Electronic Control Module detected a hook-up to an emissions testing device, it would adjust its emissions control system to conform to existing emissions regulations. Once the system was disconnected, the cars would revert to emissions performance not in compliance with EPA regulations — the car’s default operating mode... This is not welcome news at all for VW, should these allegations be proven. If that’s the case, the company is looking at a scandal that affected more than 10 million cars, according to the latest reports, and the in-house costs of repairing those vehicles will be tremendous. On top of that, the EPA could slap them with an $18 billion fine... The long-term repercussions of this story could send shockwaves across the global automotive pond that could eventually lap up on the shores of the heavy-duty truck market... VW is on record saying that its goal was to surpass Toyota and become the No. 1 automobile manufacturer in the world by 2020. Making a move into the North American truck market was widely seen as a vital step in that process... Who knows what will happen next? This scandal proves two things: One, that getting cute with emissions systems and stealth software is a bad idea. And second, that in the hyper-connected world of automotive and truck manufacturing, a bad decision in one business unit can have devastating consequences in markets and countries far, far away...
Herndon, VIR, USA - CCJ Digital, by Jack Roberts - September 22, 2015Labels: truckmakers troubles
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