The greatest scandal in Volkswagen's history may also be one of the largest in the entire automotive industry, potentially overshadowing the Ford Pinto fiasco of the 1970s. Last week it was discovered that Volkswagen had programmed a great number of its clean diesel vehicle models to run cleaner when their engine diagnostic plugs are detected as being in use. When the car's diagnostic plugs - used to aid in engine emission checks - are unplugged, the vehicles' engines return to a dirtier running state, releasing up to amounts of nitrous oxide and carbon dioxide up to 40 times higher than legal levels. Subsequently, the US Environmental Protection Agency (EPA) has ordered the firm to repair as many as 500,000 affected vehicles in North America.
The story has developed further since then, with Volkswagen admitting on Tuesday, September 22 that as many as 11,000,000 diesel vehicles worldwide contain hardware designed to fool regulators, with the majority currently operating in Europe. A great number of other vehicle brands around the world are also affected, such as Skoda, Audi, and Seat vehicles which use Volkswagen's EA189 common rail diesel engine.
The EPA stated that Volkswagen has flagrantly violated the US Clean Air Act and has levied fines as high as $18,000,000,000 US (€16,200,000,000). The US Department of Justice has already begun prosecution proceedings. Volkswagen has entered damage control and has so far set aside $7,300,000,000 (€6,500,000,000) in the third quarter to deal with the problem. Following the news, the company has halted US sales of its 2015 and 2016 clean diesel models, and its stock price has slumped by almost 30% in three days.
