The fear among investors is that VW could face penalties of $37,500 for each car not in compliance with US clean air rules which could see it facing a bill of up to $18bn, following accusations made by the US Environmental Protection Agency last week.
Apparently the software enabled VW cars to produce up to 40 times more pollution than allowed and, as a result, the US government has ordered VW to recall 482,000 VW and Audi cars produced since 2009.
Volkswagen has now suspended sales of cars containing its four-cylinder turbo direct injection engine, used in such models as the Beetle, Golf, Jetta, Passat and Audi’s A3 luxury compact made by VW-owned Audi.
According to the EPA, the cars in question contained software that turns off emissions controls when driving normally, but turns them on when the car is undergoing an emissions test.
European and US regulators are in the process of forcing manufacturers to cut the emissions from their engines, with diesel engines in particular under the spotlight for their emission levels of small particulates.
Will auto manufacturers only be able to meet these new regulations by ‘fixing’ how their engines perform under test?
Martin Winterkorn, VW’s chief executive, has ordered an external investigation and issued an apology for ‘breaking the trust of customers and the public’ alike.
There is a lot of talk about car manufacturers struggling to deal with the issue of hacking, so it’s worrying that some among their number think it’s ok to ‘fix’ their own software in this way and with 10million lines of code in a top of the line car today it begs the questions: who is it actually benefiting - the manufacturer or the driver?
Trust and transparency have certainly taken a knock with this news because if VW has been caught fixing its software, what about the others?
Update: According to the BBC the UK press office of Volkeswagen when asked if it can categorically confirm that the emissions scandal in the US does not affect cars in the UK and Europe responds with a "No comment."
