Dieselgate Repurcussions

Fresh Storm Brewing Over VW

  • Why it matters

    Why it matters

    VW has been working hard to put the diesel emissions scandal behind it but may now face further compensation claims from German drivers angry at having to get their refitted cars serviced more frequently.

  • Facts

    Facts

    • In the wake of the diesel emissions scandal, VW has had to adjust its diesel vehicles to consume more Adblue, a solution that cuts exhaust emissions. But that’s forcing hundreds of thousands of drivers to get their cars serviced more often.
    • Lawyers say VW could face justified demands for compensation or refunds from drivers who feel misled about the performance of their vehicles.
    • In Germany, many garages refitting VW cars have started handing out coupons for free Adblue refills. It remains to be seen whether that will be enough to ward off compensation demands.
  • Audio

    Audio

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Dieselgate keeps hunting Volkswagen. Source: Julian Stratenschulte / DPA

VW’s top management should be worried about customers such as Heinz S. and Norbert V. Drivers like them are gathering in internet forums to vent their anger at having to get their VWs, Audis and Porsches serviced with what they say is annoying frequency to fill them up with Adblue, a fluid that reduces harmful emissions.

On the online car forum auto-motor-oel.de last year, Heinz S. complained that he had to fill up his 184 horsepower Q3 21 TDI with Adblue twice. “The first time I had to get a refill after 6,000 km; then after a further 5,500 km.”

Norbert V. was also irritated, to say the least. “After 5,000 km, the vehicle had to go in for a service the first time. The cost was €130.” He concluded: “If I could give the car back, I would.”

Complaints like these could turn into a fresh nightmare for the world’s largest automaker. Handelsblatt has learned that most drivers of VW, Audi and Porsche diesel models don’t get much further than 10,000 kilometers without having to replenish their supply of Adblue, a mixture of urea and water that is injected into the vehicle’s exhaust and turns polluting oxides into harmless water vapor and nitrogen. Drivers who don’t fill up on Adblue are not able to start their cars.

The carmaker could be confronted with additional compensation lawsuits and legions of disenchanted diesel customers.

In the wake of the diesel scandal in which up to 11 million VW vehicles were outfitted with fraudulent software that concealed harmful emissions, exhaust systems are being altered to use more Adblue. While the fix has cut down on polluting emissions, the problem for VW drivers is that the tanks that hold Adblue are now too small and require frequent refills.

This risks further complicating a diesel scandal, which became public in September 2015 and has turned into a long-term fiasco for VW as the carmaker could be confronted with additional compensation lawsuits and legions of disenchanted diesel customers. To boost sales, VW had previously promised buyers of diesel models that they could travel long distances of up to 30,000 kilometers without having to fill up on Adblue.

In some models, putting in fresh Adblue is a decidedly complicated business that can involve clearing out the trunk and removing the spare wheel.

The carmaker formerly installed manipulating software to limit the consumption of Adblue during routine driving despite the negative effect on emissions. In one case between 2010 and 2012, VW’s own engineers calculated that the Audi Q7 sport utility vehicle needed up to 2.5 liters of Adblue every 1,000 kilometers to stick to the emissions rules. At that time, the model’s Adblue tank took only 12 liters, meaning that drivers would have needed to fill up on Adblue every 5,000 kilometers or so.

This has prompted the Munich state prosecutors’ office to launch an investigation. Authorities last week searched the headquarters of VW’s luxury unit Audi in the southern city of Ingolstadt as well as the Munich office of the carmaker’s U.S. law firm, Jones Day.

23 p14 Adblue Car Models of the VW Group-01
VW Adblue Car Models Audi Porsche Diesel

Within VW, the Audi unit is regarded as the inventor of the Adblue system. At present, investigators are only focusing on the 80,000 3-liter models sold in the United States. VW and Audi have already admitted to the manipulation of exhaust systems on those vehicles, using software that reduced consumption of Adblue.

The VW group began removing such software from its cars at the start of 2016, including in Germany. The carmaker has also had to ensure that newly-manufactured vehicles consume adequate quantitates of Adblue. The tanks, however, haven’t been enlarged and take only 11 to 24 liters.

So far, VW isn’t saying how many of the 11 million manipulated vehicles were fitted with the Adblue system.

“We have reached settlements with the U.S. authorities for the 3.0-TDI engines as well as the 2.0-TDI aggregates. We have nothing to add to that,” the company said in response to a Handelsblatt inquiry. “Besides, we are in ongoing legal proceedings about which we can’t make public statements.”

Germany’s Federal Motor Transport Authority, a government supervisory body for the motor industry, also declined to comment on the number of manipulated cars that used the Adblue system.

It’s clear though that Adblue switch-off software was not only confined to the 3-liter diesel engines of Audi, Porsche and VW. Adblue was also fitted into many of the smaller 2.0-liter models of the VW group such as the best-selling Tiguan, Passat and Sharan models. Insiders estimate that several hundred thousand vehicles are affected by the Adblue trickery.

Internet magazine “motor-talk.de” has reported that 145,000 manipulated 2-liter engines are driving on German roads alone. Many of their owners will likely start demanding compensation or their money back. VW has already promised to shoulder the cost of Adblue refills in the U.S.

“If sales or advertising brochures promised the customer longer service intervals, compensation or a reversal of the purchase agreement are feasible.”

Julius Reiter, Lawyer at Baum Reiter & Collegen

In Germany too, many VW garages that are currently refitting VW cars have begun handing out coupons for free Adblue refills. It remains to be seen whether that will be enough to satisfy owners.

VW has said that the necessary adjustments to Adblue systems won’t reduce the value of its vehicles. But lawyers for disappointed customers don’t see it that way.

The owners of manipulated diesel vehicles have a realistic chance to force VW to pay them compensation or give them refunds, said Julius Reiter, a lawyer at Baum Reiter & Collegen in Düsseldorf, a firm that is representing VW shareholders and drivers in the Dieselgate scandal.

“If sales or advertising brochures promised the customer longer service intervals, compensation or a reversal of the purchase agreement are feasible,” he said.

Tobias Ulbrich, who also represents customers affected by the scandal, agrees.

“All statements pertaining to the environment are an integral part of the purchase agreement, which is why they are always a key factor in the decision to purchase,” he said.

If a vehicle doesn’t adhere to the European admissions standards, “it should never have been manufactured or brought into the market,” he added.

The dissatisfaction threatens not only VW’s relations with previous car buyers, but to turn away new ones. A look through online car forums reveals plenty of customer dismay.

One diesel owner recently said he drives 10,000 kilometers every four months. He fretted over the possibility of getting stuck in the middle of nowhere one day, his engine not starting because of lacking Adblue.

“It’s not a very pleasant thought,” he said.

 

Jan Keuchel is a Handelsblatt correspondent covering investigations and the German legal system. Volker Votsmeier is an editor with Handelsblatt’s investigative reporting team. Contact the authors at:  keuchel@handelsblatt.com and votsmeier@handelsblatt.com

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