Many staffers and managers within Volkswagen’s engine-development department knew about Volkswagen’s illegal emissions-cheating “defeat device,” including a whistleblower who told other executives, German newspaper Sueddeutsche Zeitung reported (via Reuters).

The report said that there was a “desperation” among engineers tasked with creating a U.S.-emissions compliant diesel engine. Rather than going to the executive board with a failed engine, workers developed the cheat system to avoid repercussions from higher-ups.

The report also indicates that Volkswagen alone — not alongside auto supplier Bosch — created the defeat device.

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The New York Times says U.S. states attorneys general are accusing Volkswagen from withholding critical documents from their investigations into the automaker’s admission that more than 500,000 cars and SUVs in the U.S. were illegally polluting.

The report says that Volkswagen is citing a notoriously strict German law that protects data and documents from investigations overseas, and that their own investigations have stalled — similar to what federal regulators said when they filed a lawsuit against the automaker on Monday seeking billions.

Volkswagen didn’t comment on the report. (Read More…)

(UPDATE: Updates the story throughout, including penalty figures. Volkswagen comment.)

The Justice Department on Monday filed a multi-billion dollar lawsuit against Volkswagen for illegally selling emissions-cheating cars in the U.S. from 2009 until last year and said the automaker withheld information about its 3-liter diesel engine’s “defeat device” after investigators uncovered the scandal.

The lawsuit, filed in eastern Michigan court, seeks more than $40 billion in damages from the automaker.

In announcing the lawsuit, officials from the Environmental Protection Agency signaled that regulators and officials may be at a standstill with Volkswagen regarding how it intends to fix its cars in the U.S.

“So far, recall discussions with the company have not produced an acceptable way forward. These discussions will continue in parallel with the federal court action,” Cynthia Giles, assistant administrator for enforcement and compliance assurance at EPA, said in a statement.

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Volkswagen’s emissions cheating program closely follows a set of parameters that are very similar to those defined by the New European Driving Cycle (NEDC), an engineer said this week.

The cheat exists in the ECU’s “main mode,” said Felix Domke, and triggers a normal dosage of urea and other exhaust controls to bring NOx emissions to within acceptable levels.

Domke presented his findings of an unpacked Volkswagen ECU to the 32^nd Chaos Communication Congress in Germany.

His findings are mostly in line with what the automaker has already admitted: its 11 million cars worldwide cheated emissions tests by using two different modes for operation, and that its cars could pollute up to 40 times the legal limit of nitrogen oxides when running normally.

But Domke, who said he owns a Volkswagen Sharan equipped with a 2-liter diesel engine, said his own observations showed a severe change in the ECU’s behavior when it exceeded the bounds of what it considered was an emissions test — more than what’s been reported so far.

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Fifteen leaders of environmental and health groups signed off on a letter sent to environmental regulators Dec. 18 asking officials to fully punish Volkswagen in response to Tesla CEO Elon Musk and others asking authorities to push for electric vehicles instead.

The letter, which was signed by the policy director for the Coalition for Clean Air and the director of the Sierra Club California, among others, calls for “vigorous enforcement of both criminal and civil laws” to deter actions like Volkswagen’s cheating of diesel emissions tests.

The California Air Resources Board and the U.S. Environmental Protection Agency revealed in September that Volkswagen admitted to fitting nearly 500,000 cars in the U.S. with an illegal “defeat device” designed to cheat emissions tests. In November, the agencies said an additional 85,000 cars with 3-liter diesel engines were cheating too. (Read More…)

The European Union’s anti-fraud office is investigating Volkswagen for misusing publicly funded loans to develop illegally cheating software in its cars, the New York Times reported Wednesday.

Volkswagen was provided the low-interest loans by the European Investment Bank to develop engines that were more fuel-efficient and produce less carbon dioxide, according to the report. In September, the automaker admitted that 11 million vehicles worldwide polluted more than advertised and used an illegal “defeat device” to fool emissions tests.

The automaker’s woes compounded Wednesday: A European bank — partly funded by the U.S. — announced it would suspend a $327 million loan to Volkswagen that would have been used to build a $1.2 billion factory in Poland. That factory was slated to build commercial vehicles.

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Auto supply giant Bosch is being investigated for its part in the widespread emissions cheating scandal that has engulfed Volkswagen, Bloomberg reported (via Automotive News).

Prosecutors in Stuttgart say that they’ve contacted the company, which supplied Volkswagen with engine control modules that helped the cars illegally pass emissions tests, about their role in engineering the illegal devices.

A spokeswoman for Bosch said it would comply with requests from authorities.

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(Update: With EPA comment and clarification on their tests.)

The U.S. Environmental Protection Agency approved for sale Friday the 2016 BMW X5d after new tests of that car revealed that it did not use an illegal “defeat device” to cheat emissions standards, Reuters reported.

Well it didn’t use a defeat device as far as they could see, anyway.

“Our screening tests found no evidence of a defeat device in the 2016 BMW X5,” EPA spokeswoman Laura Allen told Reuters. “No evidence” is hardly a clean bill of health from the environmental agency, but at this point we’ll take what we can get.

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Audi, a brand within Volkswagen Group that markets the majority of 3-liter diesel engines sold by the group in the United States, released a statement Monday detailing how it plans to fix vehicles that use a defeat device. The automaker also stated that three separate Auxiliary Emissions Control Devices — not just one — are used in 2009 and later 3-liter diesels used by Audi, Volkswagen (Touareg) and Porsche (Cayenne).

AECDs for those engines will “be revised, documented and submitted for approval,” Audi said in the statement.

Of the three AECDs, the EPA questioned the legality of a temperature conditioning procedure of the exhaust-gas cleaning system.

“One of (the AECDs) is regarded as a defeat device according to applicable US law. Specifically, this is the software for the temperature conditioning of the exhaust-gas cleaning system,” Audi said in a statement.

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Volkswagen said Thursday that early versions of its EA 288 engines could have been equipped with the illegal emissions software at the heart of its diesel scandal, Reuters reported (via Automotive News).

The revelation would largely affect European cars, and could potentially expand the list of 11 million cars Volkswagen will be forced to recall this year.

U.S. cars using the “Generation 3” engine, which include 2015 models of the Volkswagen Golf, Jetta, Beetle and Passat and Audi A3, were already included in the stop-sale and notification by the Environmental Protection Agency. (Read More…)

Volkswagen has suspended its chief of quality control for “incriminating correspondence” it found regarding its illegally polluting diesel cars, German newspaper Bild (via Automotive News) reported Wednesday. Tuch was suspended last week, according to the Wall Street Journal.

Frank Tuch is the fifth high-ranking official suspended from Volkswagen because of the scandal. According to reports, Tuch wasn’t part of the company when it developed the EA 189 engines that have become the center of the cheating scandal. The former Lotus COO and Porsche quality control officer may have known about the illegal software after he joined the company in 2010.

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German magazine Der Spiegel reported Wednesday that at least 30 Volkswagen insiders and managers had knowledge of the illegal “defeat device” and there may be more.

The claim would somewhat refute to what Volkswagen of America chief Michael Horn testified in front of a congressional subcommittee last week when he told representatives that “a couple of software engineers” at Volkswagen in Germany were responsible for the the scandal that has cost the company billions of dollars.

Volkswagen hired U.S. firm Jones Day to conduct an external investigation while the company inquires internally how engineers installed software on 11 million diesel cars that would cheat emissions tests.

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Update: Official statement from EPA.

During his voluntary testimony for a congressional committee Thursday, Volkswagen of America CEO Michael Horn announced the company would withdraw their application for emissions certification for 2016 model year Volkswagens powered by 2-liter diesel engines.

However, the reason for that withdrawal is not directly related to the “defeat device” that’s been at the center of the ongoing diesel controversy.

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While working on a story about some very old cars, I stumbled upon something relevant to the latest big story in the automotive world.

I ran into a Model T collector who’s also a powertrain engineer for Ford. Seizing the opportunity, I asked him if he could tell me what he was working on (sometimes they say no). He said that he was responsible for developing computerized engine controls. Because of that expertise, I started to ask him some questions about the software program that Volkswagen apparently used to cheat on the EPA’s diesel emissions testing.

What he was willing to say and what he wouldn’t say intrigued me. (Read More…)

Audi said that 2.1 million of its cars worldwide have been fitted with illegal software to help it cheat emissions tests, Reuters reported.

The automaker announced that multiple models including the A1, A3, A4, A5, A6, TT, Q3 and Q5 were affected by the “defeat device” uncovered by researchers, which is grinding Volkswagen to an unimaginable halt.

Roughly three-quarters of the affected Audis were sold in Western Europe, including 577,000 in Germany alone, according to the report. (Read More…)