Friday 17 November 2017

VW chairman: 'Emissions-rigging scandal caused by firm's culture'

New CEO: VW’s Matthias Mueller
New CEO: VW’s Matthias Mueller

Alan Tovey

A corporate culture that tolerated rule-breaking and misconduct by employees was at the heart of Volkswagen's emissions-rigging scandal, the German car maker's chairman admitted on Thursday.

Hans Dieter Pötsch said "misconduct, flaws in our processes and an attitude that tolerated breaches of rules" had been allowed, stretching back over a decade, and ending with the company deliberately cheating pollution control tests on a massive scale.

"This was not attributable to a one-off error, but an unbroken chain of errors," he said.

However, the 450 people investigating the scandal through an internal VW probe and an external effort led by the law firm Jones Day have yet to discover just how high up the deception went.

Mr Pötsch, speaking at the company's Wolfsburg base, said nine staff have been suspended but as yet "there is no evidence to suggest that supervisory board members or management board members are implicated."

He said the company was "relentlessly searching" for those responsible but it was not yet known if those involved "were aware of the risks and the potential damage to the company."

VW was plunged into crisis in September when environmental regulators in the US said that almost half a million diesel-powered VW cars had been fitted with so-called "defeat devices", which allowed them to beat emissions tests.

The group, which also owns Audi, Seat and Skoda, has admitted that as many as 11 million cars worldwide could have defeat devices installed. The news struck tens of billions of euros off VW's market value, cost chief executive Martin Winterkorn his job and has left the company facing costs that some analysts put at above ¤30bn.

Mr Pötsch said the decision to cheat the tests was the result of VW not being able to meet tough US environmental controls, after it decided to launch a sales push for its diesel vehicles in the relatively untapped American market.

"No business justifies crossing legal and ethical boundaries," Mr Pötsch said, adding that the company was introducing new processes aimed at strengthening staff supervision: "Even though we cannot prevent misconduct by individuals once and for all, in future it will be very difficult to bypass our processes."

Matthius Mueller, the company's new chief executive, said Volkswagen will restructure to make it more decentralised and efficient as a result of the scandal, but none of the group's marques is being put up for sale. He said the investigation indicated that "information [about the deception] was not shared, it stayed within a small circle of people who were engineers" and while the crisis was "serious, the company will not be broken up by it".

VW said winning back the trust of customers, politicians, investors and the public was its priority, and to do this, future emissions tests would be carried out externally, rather than by the company itself.

Alan Tovey, Daily Telegraph

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