VW’s CO2 investigation: What does it mean for Irish motorists

We still have to hear from the Audi, Skoda and Seat brands in relation to the CO2 implications

Before the champagne corks begin popping in Volkswagen dealerships, it should be noted that VW has merely identified the number of current cars affected and still have to work out how many older models had wrong figures.

Before the champagne corks begin popping in Volkswagen dealerships, it should be noted that VW has merely identified the number of current cars affected and still have to work out how many older models had wrong figures.

 

So what is the latest on the Volkswagen saga?

The car giant has said an initial investigation into the various scandals at the firm has found that it did not purposely cheat on CO2 emissions. There are cars with wrong figures, but the numbers affected are in the order of 36,000 rather than the 800,000 initially announced by the firm. In turn the number of Irish cars affected in the CO2 scandal – initially estimated at 9,000 – is expected to be much lower.

However, before the champagne corks begin popping in Volkswagen dealerships, it should be noted that VW has merely identified the number of current cars affected and still have to work out how many older models had wrong figures.

We have also to hear from the Audi, Skoda and Seat brands, though they are expected to deliver similar low figures when the full report comes out tomorrow.

The findings announced on Wednesday don’t relate to the original emissions scandal concerning illicit software fitted to 11 million vehicles worldwide and designed to cheat emission tests. There is no claim that the number of vehicles affected by this has changed, with nearly 120,000 Irish cars affected.

So did it cheat on CO2?

It seems the investigation has found that where emissions were wrong it was not done intentionally. The differences found are in the order of one or two grammes and for the Volkswagen brand it relates to nine model variants currently sold, only six of which are on sale here.

What does that mean for the tax?

Volkswagen Group had set aside €2 billion to cover any tax due on models sold and its chief executive Matthias Müller had written to, amongst others, the Minister for Finance Michael Noonan stating the firm would cover the costs of any extra tax that may be due as a consequence of higher emissions figures attributed to affected cars.

Affected models

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Given the dramatic drop in the potential number of cars affected, and the fact that the difference seems to be in the order of one or two grammes, there will now be fewer cars pushed into higher tax bands and that will mean a far lower bill for Volkswagen.

However it remains to be seen how many older cars are affected and what the tax implications are for these.

Why is there such a difference in the initial estimates and today’s findings?

That may become clearer tomorrow but it seems that Müller – who had just been appointed CEO after the NOx scandal broke – was informed by an internal whistleblower that an array of its cars were claiming “improbably low” CO2 numbers, which had a direct effect on their tax status in most European countries. Given the circumstances, it’s hardly surprising the firm didn’t want to be seen underplaying or covering up the latest scandal.

So is the brand in the clear?

No, the firm still accepts it fitted 11 million cars with illicit software designed to cheat official tests for Nitrogen oxides (NOx) a harmful emission linked to serious health issues. Of these 115,917 vehicles in Ireland are affected across the Audi, Seat, Skoda and Volkswagen brands. These motorists have been contacted by Volkswagen and recalls are planned to start in January.

However as there are no tax implications on NOx, nor does it affect the safety or driving ability of the car, Irish motorists are likely to be less irate over the matter. At its heart is a breakdown in trust with the car giant, while the CO2 issue had potential cost implications for several thousand motorists - and still potentially does for those affected.

Dealers will, however, welcome the news given this is a critical time for new car sales, when buyers are considering their January purchases. Based on the firm’s original figures up to 40 per cent of VW’s current Irish offering could have had the wrong CO2 figures. Now we know it only affects six variants currently on the Irish market - all relatively low volume sellers - dealers will be hoping to refocus on sales.

So what do we still not know?

We still have to hear from the Audi, Skoda and Seat brands in relation to the CO2 implications for their current model ranges. We also have to find out just how many older cars across the Group’s brands carry the wrong CO2 figures.

So when will we know more from the report?

In many ways the statements issued today on CO2 is the “good news” event for Volkswagen from the investigation, so perhaps it’s not a coincidence that this has come out first.

On Thursday the chief executive Matthias Müller is due to reveal more details of the report, in particular information on the NOx investigation.

The firm has claimed at various stages that the cheating software was the work of “rogue engineers”.

However many legislators who have held official inquiries into the scandal question whether a handful of engineers could have fitted this software to so many cars – that made such a radical improvement in emissions figures – without someone in senior management being aware or asking questions.