Fuming Fallout

Germans investigate auto supplier Bosch in wider Chrysler emissions probe

Pk Bosch – Jahreszahlen
Will Bosch be ensnared by Dieselgate? Source: Reuters

Prosecutors in the southwest city of Stuttgart have opened investigations against two managers at Bosch’s US subsidiary for aiding and abetting fraud. The news comes as the German car-parts maker, which has its headquarters near Stuttgart, denied involvement in carmaker-sponsored tests on the effects of traffic fumes on animals and humans.

Two diesel-engine vehicles, the Chrysler Grand Cherokee 3.0 L and the Chrysler Dodge Ram 1500, which have been on sale in the United States since 2014, had shown signs of a “reduced effectiveness” of emissions control systems. Bosch software was believed to have been used to detect whenever the vehicle was not on an emissions test bench.

In VW’s Dieselgate scandal, the world’s largest car-parts maker has categorically denied any wrongdoing, insisting that Bosch simply made the components according to Volkswagen’s specifications and that it was not responsible for how they were used.

The two Chrysler models now under scrutiny were already subject to a so-called Notice of Violation by the US Environmental Protection Agency, or EPA. These warnings usually offer the recipient an opportunity to comply with EPA regulations. In January of last year, the EPA accused Fiat Chrysler Automobiles of using cheating software to allow excessive diesel emissions to go undetected, leaving FCA facing a maximum fine of about $4.6 billion (€3.7 billion).

Bosch is already being probed for its role in designing engine systems for VW, Porsche and Mercedes-Benz vehicles.

In a statement on Wednesday, Bosch said: “It is well known that the accusations of manipulation of diesel software are the subject of a preliminary legal proceeding and civil lawsuit also involving Bosch.” A Bosch spokesman said the company was fully cooperating with the authorities.

German prosecutors are already probing Bosch employees for their role in designing engine-management systems for Volkswagen, Porsche and Mercedes-Benz vehicles. In February 2017, Bosch paid $328 million in compensation to US buyers and dealers of VW-made cars affected by the Dieselgate scandal, without admitting direct guilt.

Earlier this week, Bosch CEO Volkmar Denner conceded the auto industry had suffered an enormous loss of confidence over Dieselgate and the latest scandal over the toxic-fume tests. He added the only way to regain that trust would be to improve transparency, perhaps through independent certification of vehicles and better cooperation with environmental organizations.

Martin-Werner Buchenau is a correspondent for Handelsblatt in Stuttgart. Jeremy Gray is an editor for Handelsblatt Global. To contact the authors: buchenau@handelsblatt.com and j.gray@handelsblattgroup.com

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