Volkswagen Group has one month to come up with a plan to resolve its emissions scandal. U.S. District Court Judge Charles Breyer granted an extension to the deadline, after VW said it needed more time to finalized a proposal on how to fix cars that were outfitted with deceptive software in order to meet state and federal emission standards.
The Environmental Protection Agency and California Air Resources Board backed VW’s request, even though Tod Sax, who runs CARB’s enforcement division, admitted there is a possibility that there won’t be a comprehensive solution available for all of the malfunctioning vehicles. That’s because earlier and later TDI (turbocharged direct injection) models — a concept for which VW won the Green Car of the Year award in 2009) — utilize two different exhaust systems. The earlier models depend on NOx traps that would take a considerably more modification than later emission systems.
Judge Breyer warned both sides, however, that if a settlement isn’t reached by April 21 of this year, he may send the case to trial. Doing so may not only make it harder for VW to negotiate a settlement, but it could also slow down a ‘fix’ to the environmental problems — something that environmental organizations suggest should be at the top of the list when it comes to hammering out a court settlement.
There’s considerable disagreement as to how that should be accomplished. Environmental groups are calling for a remedy that will not only focus on the environmental impacts of the VW cheating scandal, but also provide remedy for car owners that are now stuck with non-compliant vehicles.
“The polluting vehicles need to be fixed or taken off the road, and the consumers who trusted they were buying less-polluting cars need to be compensated. Period,” said Kathryn Phillips, director of Sierra Club California, in a statement released last week. “Otherwise the legacy of Volkswagen’s deceitful actions will be as dirty and dangerous as the smog left behind by their vehicles — people will continue to breathe dirtier air, consumers will lose faith in watchdog agencies, and manufacturers will believe they can cheat and get away without feeling the full consequence.”
Environmental groups also suggested that VW should be fully prosecuted, and the penalties it pays should go toward building an electric car industry that could open the doors for lower-income families to afford more environmentally-sustainable transportation.
Members of the Union of Concerned Scientists, however, suggest that forcing VW to buy back the defective vehicles would be the best remedy, because it would take the offending products off the roads and give consumers a means to buy compliant vehicles. It would also send a strong message to the auto industry that tinkering with emissions systems that can’t meet state or federal standards will lead to more than just penalties.
“Forcing VW to buy back any vehicles that could not be fully fixed would not just eliminate future environmental risks, but it would also compensate consumers who were deceived by VW and have seen the resale value of these vehicles plummet,” explained Dave Cooke, a senior analyst for UCS’ Clean Vehicles Program. At the same time, he continued, if regulatory agencies decide to let the vehicles stay on the streets, then “VW must be forced to offset the continuing damages.”
The environmental lobby and those supporting the UCS’ stance agree on one thing: They don’t feel that VW should be nudged toward ramping up the electric car industry without some sort of compensation for its violations. Both have also expressed concerns about the idea of letting the defective vehicles stay on the road for lack of an available fix.
It’s also unclear how regulatory agencies would be able to fairly enforce emissions standards for other vehicles if it had tens or hundreds of thousands of vehicles with excessively high emissions that it could not regulate because of the cost and complexity of fixing them.
Meanwhile, the suits against VW continue to mount. Kentucky is one of the latest states to mount a suit against the embattled car manufacturer, in this case for violating its consumer protection act. The suit also names the Audi and Porche divisions of the corporation. At least five states so far have filed suit, and 48 state attorney’s offices have launched investigations of its practices. At least two county regulatory agencies in Florida and Texas have also announced their plans to go after the automaker, citing violations of their emission standards.
VW released a statement confirming its commitment to “resolving the U.S. regulatory investigation into the diesel emissions matter as quickly as possible and to implementing a solution for affected vehicles.” It said it is working with the courts in an effort to “bring about a prompt and fair resolution of the U.S. civil litigation.”
None of the litigants have offered a statement on what that solution ultimately may entail. But with suits still mounting and organizations still debating over the outcome, next month’s court hearing may get almost as much media coverage as the rhetoric of this year’s divisive presidential primaries.