Volkswagen to improve engine software development to avoid future cheats

WOLFSBURG, GERMANY: Volkswagen has agreed steps to improve oversight of engine-software development to avoid future manipulations after its admission of cheating US diesel-emissions tests caused the biggest scandal in the German carmaker’s corporate history.

“No business justifies crossing legal and ethical boundaries,” Chairman Hans Dieter Poetsch told a news conference at the company’s headquarters in Wolfsburg on Thursday.

“Even though we cannot prevent misconduct by individuals once and for all, in future it will be very difficult to bypass our processes.”

Europe’s biggest carmaker launched internal and external investigations in September after admitting to cheating diesel emissions tests in the United States.

Poetsch said the external investigation by US law firm Jones Day was making good progress but would need time to reach conclusions.

He said Volkswagen would not name any individuals involved on Thursday but he added that it was likely only a limited number of people took part in the deception.

Up to 11 million cars worldwide have software installed that defeats the tests, and the costs to Volkswagen of fixing the cars, paying fines to environmental authorities and dealing with legal challenges are estimated in the tens of billions of euros.

The scandal has already forced out its long-time chief executive and wiped 13 percent, or 10 billion euros ($11 billion), off its market value.

“We will not allow the crisis to paralyse us,” Chief Executive Matthias Mueller said. “Although the current situation is serious, this company will not be broken by it.”

Volkswagen needs to win back trust lost through its cheating of US diesel emissions tests that may affect 11 million vehicles worldwide, its chairman said on Thursday.

“Winning back trust is our top priority and our top challenge,” said Hans Dieter Poetsch.

“The last two and a half months have been unprecedented for the VW group,” he said, referring to the turmoil at Europe’s biggest carmaker since it admitted to cheating the tests on September 18.