Volkswagen CEO Goes Before Congress

“We have broken the trust of our customers, dealerships, and employees, as well as the public and regulators,” said Michael Horn before a congressional hearing.

October 09, 2015

WASHINGTON – Yesterday, Michael Horn, president and CEO of Volkswagen Group of America, testified before the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations at a hearing titled, “Volkswagen Emissions Cheating Allegations: Initial Questions.”

Horn stated that on September 3, Volkswagen AG disclosed at a meeting with the California Air Resources Board (CARB) and the U.S. Environmental Protection Agency (EPA) that emissions software in four-cylinder diesel vehicles from model years 2009-2015 contained a “defeat device,” which is hidden software that recognizes whether a vehicle is being operated in a test laboratory or on the road. The software made those vehicles emit lower levels of nitrogen oxides during laboratory testing rather than when the vehicles were driven on the road.

Horn said that VW described to EPA and CARB that the emissions control strategy also included a software feature that should be disclosed to and approved by them as an auxiliary emissions control device (AECD) in connection with the certification process. “As a result, we have withdrawn the application for certification of our model year 2016 vehicles,” he said.

“These events are deeply troubling. I did not think that something like this was possible at the Volkswagen Group. We have broken the trust of our customers, dealerships, and employees, as well as the public and regulators,” Horn said.

Focusing on VW customers Horn outlined five goals the company is undertaking to help mend its brand, trust and global reputation:

  1. Conducting investigations on a world-wide scale into how these matters happened, and holding those responsible parties accountable.
  2. Communicating to the public that the EPA has said affected vehicles do not present a safety hazard and remain safe and legal to drive.
  3. Technical teams are working to develop remedies for each of the affected groups of vehicles.
  4. VW is examining its compliance, processes and standards and will adopt measures to ensure “something like this cannot happen again.”
  5. Committing to regular and open communication with VW customers, dealers, employees and the public moving forward; first steps include a designated service line and website, and Horn said he has sent a letter to every affected customer.

During Q&A from committee members, Horn reiterated that VW is committed to eventually fixing vehicles and helping car dealers with the fallout, since they cannot sell the affected diesel models. The Wall Street Journal reports that VW doesn’t have specific timelines for bringing vehicles into regulatory compliance. “I apologize for not having a full-fledged plan for Volkswagen in my pocket,” Horn said. The news source adds that repairs could take five to 10 hours per vehicle, which amount to about 430,000 vehicles— a process that could take years to complete.

U.S. Rep. Frank Pallone (D-NJ-06) asked Horn about Volkswagen’s plans for addressing excess pollution from the affected diesel models. The Journal adds that Horn cited EPA data that shows light-duty diesel cars, such as VWs, account for less than two-tenths of 1% of the overall nitrogen oxides emitted in the United States, “which is not belittling this and it is clearly unacceptable,” Horn said, “but within this context it needs to be addressed.”

On September 18, EPA issued a Notice of Violation to VW (Volkswagen AG, Audi AG and Volkswagen Group of America, collectively) stating that the company “manufactured and installed defeat devices” in certain model year Volkswagen and Audi diesel passenger cars. Since then, the fallout has been extraordinary. VW has publically admitted and apologized for violating EPA’s regulations, suspended leaders at its R&D divisions, named a new CEO, began restructuring its North American business and has set aside $7 billion to address the issue.

Also on October 8, prosecutors raided VW’s corporate headquarters, other offices and private homes of employees in Germany as part of the investigation into the automaker's rigging of diesel emissions tests, reports Reuters. VW handed over a "comprehensive" range of documents, notes the news source.

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