Germany orders Volkswagen to recall 2.4m cars

Germany has ordered the mandatory recall of 2.4 million Volkswagen, Audi, Skoda and Seat cars over the car group’s emission scandal.

The mandatory recall in Germany means other EU countries will follow suit, with an estimated 8 million mandatory recalls possible.

German transport minister Alexander Dobrindt said on Thursday that the country's automotive regulator has ordered Volkswagen Group to start a mandatory recall of 2.4 million affected cars currently on the road in Germany by the start of 2016. The Federal Motor Transport Authority rejected a Volkswagen proposal for a voluntary recall.

“The recall will begin at the start of 2016. The KBA will monitor the start of the recall action and its progress,” Dobrindt told reporters in Berlin.

Volkswagen admitted last month it had installed software in diesel vehicles to deceive US regulators about the true level of their toxic emissions. It has since confirmed the cheat device software was fitted to 11 million cars worldwide, including 106,752 vehicles in Ireland. These are diesel engined cars - 1.2-litre, 1.6-litre and 2-litre - sold by Audi, Skoda, Seat, VW and VW commercials.

Some analysts have said the scandal could cost Volkswagen as much as €35 billion to cover vehicle refits, regulatory fines and lawsuits.

VW owners seek compensation

In Britain a survey by consumer group Which? of more than 2,000 motorists who own a VW diesel manufactured between 2008 and 2015 - the timeline for cars affected - showed that 90 per cent think they should get compensation.

German car-maker has not confirmed whether owners of cars fitted with the defeat device software used to cheat environmental tests in the US will be awarded a payout.

Some 96 per cent cited fuel efficiency as an important factor when they bought their car, while 90 per cent said the environmental impact was a key consideration. The latter was also given as a concern in the wake of the emissions scandal by 86 per cent of respondents, followed by their vehicle’s resale value (83 per cent) and performance (73 per cent).

Over half (52 per cent) said they would be put off from buying a VW diesel car in the future. VW has started to write to affected owners, but nearly three-quarters (74 per cent) believe the firm’s response to the crisis has been poor.

Which? executive director Richard Lloyd said: “Many VW owners tell us they decided to buy their car based on its efficiency and low environmental impact, so it’s outrageous that VW aren’t being clear with their customers about how and when they will be compensated.

“Volkswagen UK must set out an urgent timetable for redress to the owners of the affected vehicles. We also need assurances from the Government that it is putting in place changes to prevent anything like this happening again.”

VW promises a green future

Meanwhile, in his second appearance this week before a British parliamentary committee, VW Group’s managing director for Britain has promised the car giant will “do the right thing” and “fully resolve” issues following the diesel emissions scandal.

Paul Willis said the company wants customers to know that they “do care” and “really want to put these things right”. Earlier this week he said it was ”premature” to discuss compensation.

Speaking at the Commons environmental audit committee on Monday, Mr Willis said: “On Monday I expressed my heartfelt apologies on behalf of the group that we have let down our customers and the wider public over the findings of irregularities in some diesel vehicles we produce. Today I want to reiterate that apology.

“I can affirm today Volkswagen Group’s goal is to be the world’s most sustainable vehicle manufacturer by 2018.

Asked how long the internal investigation is likely to take, Mr Willis said: “I don’t know ... it’s currently in play right now. And the supervisory board have said that when they get information they will share that information.” Asked if he had any idea of even a broad timescale, he said he had “read somewhere” that they should be “hearing something before the end of the year”.

Senior manager suspended

The car giant is undergoing criminal and regulatory investigations in the US, Europe and Asia.

Yesterday prosecutors in Italy confirmed they are investigating local managers at Volkswagen and its sports car business Lamborghini for alleged fraud over the emissions’ cheating software.

In Germany Volkswagen has suspended the head of its main transmissions plant as it presses on with its own investigation into who was responsible for cheating on diesel emissions tests, according to sources.

Falko Rudolph, head of VW's factory in Kassel, Germany, has been suspended after being questioned by internal investigators last week, one source on Thursday. Rudolph, who previously ran VW's main engines plant in Salzgitter, oversaw the development of diesel engines at VW between 2006 and 2010. His suspension was reported earlier on Thursday by the Wall Street Journal. VW declined to comment.

Reuters