How Volkswagen's software spotted a laboratory test, which other carmakers were drawn in, and what else sits on the company's record.
Dieselgate began on 18 September 2015, when the US EPA said Volkswagen had fitted diesel engines with software that detected emissions tests and cleaned up the exhaust only then. The company later put the number of vehicles at about 11 million, and other makers, including Opel and Fiat Chrysler, were drawn in.
For years, some diesel cars were better at taking exams than at driving. On 18 September 2015 the US Environmental Protection Agency announced that Volkswagen had fitted software to diesel engines that spotted a laboratory emissions test and cleaned up the exhaust only while it lasted. On the road, the agency said, the same cars could emit as much as 40 times the legal limit for nitrogen oxides. Four days later Volkswagen put the number of vehicles carrying the device at about 11 million worldwide.
That is the dieselgate story most people know, but it is only the first chapter. Carmakers on both sides of the Atlantic were drawn in, penalties ran into billions, and Volkswagen's record carries controversies of quite another kind.
What is dieselgate and how does a defeat device work?
Think of a student who behaves perfectly whenever the teacher is watching and does as they please the moment the teacher leaves. A defeat device is the engine-software version of that. The control unit works out that the car is sitting on a test rig, following the standard drive cycle, and switches the full emissions controls on. Once the car is on an ordinary road, those controls are dialled back.
Why would anyone do that? Because clean exhaust costs something. According to the US agency, Volkswagen's cars shut the controls off in normal driving to gain fuel economy and extra power. A 2011 Jetta SportWagen TDI that Consumer Reports put through its paces took 0.6 seconds longer to reach 60 mph in its emissions-passing mode, and highway economy dropped from 50 mpg to 46 mpg. The clean setting was the slower, thirstier one.
The practice was not new in principle. In 1974 Volkswagen paid a $120,000 fine to settle an EPA complaint over defeat devices that disabled pollution-control systems, a breach of the US Clean Air Act.
The clean setting was the slower, thirstier one.
How did the Volkswagen diesel scandal come to light?
The trail starts in 2014, with the International Council on Clean Transportation reporting discrepancies between European and American versions of the same vehicles. The research behind it was commissioned from the Center for Alternative Fuels, Engines and Emissions at West Virginia University, and in May 2014 the EPA was alerted.
Volkswagen's first response was denial. For 15 months the company put the gaps down to technical reasons rather than deliberate design. Then, on 21 August 2015, it acknowledged to the EPA and the California Air Resources Board that its emissions systems had been rigged. A formal admission followed on 3 September, straight after the EPA warned that it might not approve the company's 2016 models.
The public side moved quickly. The EPA issued its notice of violation on 18 September, and on 20 September Volkswagen said it would stop selling the affected diesels in the United States; chairman Martin Winterkorn apologised and promised to cooperate. Canada, whose standards sit close to the American ones, halted sales too. Shares lost 20 per cent on the first trading day after the news and another 17 per cent the day after. Winterkorn resigned on 23 September.
The cost of the diesel emissions scandal for Volkswagen
The EPA's original action covered cars from the 2009 to 2015 model years, and it said the fraud began in 2008. A recall of around 482,000 cars with four-cylinder 2.0-litre TDI engines was ordered in the United States, where federal penalties could in theory have reached US$18 billion. On 28 June 2016 Volkswagen agreed to pay $15.3 billion, the biggest auto-related consumer class-action settlement the United States had seen.
Further bills followed. In March 2016 the Federal Trade Commission sued over the "clean diesel" advertising, arguing the cars were less environmentally friendly than claimed. A second EPA notice, dated 2 November 2016, covered 3.0-litre V6 diesels in Audis, Volkswagen Touaregs and Porsche Cayennes, with all V6 cars from the 2009 model year onwards named as non-compliant. Volkswagen disputed that, saying the software was legally permitted, yet shortly afterwards stopped sales of those vehicles and some the EPA had not even questioned.
In January 2017 the company agreed to plead guilty and pay $4.3 billion in penalties, and six executives were charged. Later that month a US judge approved a $1.2 billion settlement for 650 American dealers, who would receive an average of $1.85 million each. By January 2019, 13 Volkswagen employees had been indicted, Winterkorn among them. Oliver Schmidt and James Robert Liang, both former executives, pleaded guilty and were jailed. Engineering firm IAV GmbH was fined $35 million in the US, and in Canada the government charged Volkswagen AG in December 2019 over the import of nearly 128,000 cars that did not meet its standards, ending in a plea deal on 60 charges.
At home the damage was industrial as well as financial. In November 2016 Volkswagen and its unions agreed to cut 30,000 jobs by 2021, while 9,000 new jobs were promised in electric-car production. The company also announced an electric push, with 1 million electric Volkswagens by 2025 and a figure of 3 million for the wider group, and a manager said its diesels would not be offered in the United States.
Why did VW emissions cheating happen?
Pressure and cost collided. Standards kept getting tighter, and the technology to meet them was not ready. Meeting the rules could add anywhere from $800 up to $3,000 to the price of each vehicle. Volkswagen itself conceded that it could not comply in the time it had once the standards stiffened in 2005, and analysis of the company concluded that failing internal policies let the rigging continue for so long.
Which carmakers were drawn into the diesel emissions scandal?
| Maker | What was alleged | Outcome |
|---|---|---|
| Volkswagen Group | Test-detecting software in 2.0-litre and 3.0-litre TDI engines | $15.3 billion US consumer settlement, $4.3 billion in penalties, guilty plea in January 2017 |
| Daimler (Mercedes-Benz) | Allegations of illegal software; company denies | 60,000-car recall in Germany, 870 million euro fine in 2019, $5.5 million Arizona settlement in 2022 |
| BMW | Part of an AdBlue emissions cartel; wrong software on 11,700 cars | 875m euro fine in July 2021; denies using defeat devices |
| Opel/Vauxhall | Zafira emissions changed when only front wheels turned | 64.8 million euro fine in Germany in 2021; denied using defeat devices |
| Fiat Chrysler | Over 100,000 diesel SUVs and trucks with an undisclosed defeat device | About $800 million settlement in January 2019, with no admission of liability |
Audi and Porsche
In July 2019 the German group Deutsche Umwelthilfe (DUH) published on-road measurements made with portable emissions equipment. A Porsche Panamera with an Audi-built EA897 engine, held to the Euro 5 limit of 180 mg of nitrogen oxides per km, averaged 1,498 mg/km, an 8.3-fold breach, according to DUH. Two Cayennes with the Euro 6 EA897evo engine exceeded their 80 mg/km limit by 3.6 and 4.2 times in normal mode, and the excess doubled in sport mode.
The official software update did not fully cure it. After the fix, a tested Cayenne still averaged 191 mg/km, 2.4 times the limit, at temperatures of +10 to +16 degrees Celsius. Its carbon dioxide output showed another gap: the permitted figure was 179 g/km, while DUH measured 241 g/km in real operation. An Audi A8 4.2 TDI averaged 1,422 mg/km and an Audi SQ5 3.0 TDI plus 441 mg/km, measured between +4 and +11 degrees. DUH called on the makers to publish every defeat device and either repair the exhaust cleaning or refund the full purchase price. It also criticised Germany's Federal Motor Transport Authority (KBA) and transport minister Andreas Scheuer.
Daimler and Mercedes-Benz
Mercedes-Benz is a different case, because the company has denied the charges. Through 2018 the allegations grew more specific. A German newspaper, Bild am Sonntag, reported in February 2018 that US investigators had found illegal software, including a "Bit 15" mode that stops emissions control after 16 miles, which is how long an official US test lasts, and a function called Slipguard that tries to infer a test from speed and acceleration patterns.
Daimler's position was that its diesels broke no law. European rules were loosely written, it argued, and turning down emission controls to protect the engine in conditions such as cold weather was permitted. In June 2019 Daimler recalled 60,000 GLK 220 SUVs built from 2012 to 2015, which carried software aimed at distorting emissions tests. The KBA looked to widen its inquiry to C-Class and E-Class models with OM642 and OM651 engines, which could mean up to 700,000 vehicles. A German fine of 870 million euros followed in September 2019, and in 2022 Mercedes settled in Arizona for $5.5 million.
BMW
BMW's trouble was of a different sort. The company was implicated in an "emissions cartel" accused of restricting design standards for AdBlue, the exhaust fluid, and it was fined 875m euros alongside Volkswagen in July 2021. In 2018 it recalled 11,700 diesel cars that had incorrect emissions software, while denying defeat devices as suggested by the KBA. A lawsuit that year accused BMW of colluding with Robert Bosch to produce software that hid true emissions.
Opel and Vauxhall
Opel, then owned by General Motors, was caught in Europe in 2015 with software that reacted to how many wheels were turning. A front-wheel-drive Zafira stayed inside the 80 mg/km limit only on a test stand where just the front wheels rotated. Once the rear wheels spun too, as they do on a road, nitrogen oxides ran at twice the limit with a cold engine and three to four times with a warm one. An investigation opened in January 2016 and ten dealerships were raided.
Opel denied using defeat devices. It demonstrated a compliant Zafira with TUV Hessen present, while quietly rolling out a software update to cars already in service, which journalists from the Belgian broadcaster VRT caught it doing. The update cut emissions sharply and was installed during workshop visits without owners knowing. Germany fined the company 64.8 million euros in 2021.
Fiat Chrysler
A notice from the EPA dated 12 January 2017 alleged that more than 100,000 diesel SUVs and trucks from the 2014 to 2016 model years, including the Ram 1500 and Jeep Grand Cherokee, carried software that let them exceed limits undetected by normal testing. The agency found it while expanding its checks after the Volkswagen case. Fiat Chrysler was not accused of deliberate cheating, only of failing to tell the government about the programming, and executives denied wrongdoing.
The January 2019 settlement covered roughly 100,000 vehicles with the 3.0-litre V6 EcoDiesel. It included $311 million in civil penalties to US regulators and California's air board, $72.5 million in state penalties, $33.5 million to offset excess pollution, up to $280 million for owners and $105 million of extended warranties, about $800 million in all. The company admitted no liability and the criminal inquiry stayed open. In October 2020 it also faced a UK class action valued at 5 billion pounds, over half a million vehicles from Fiat, Alfa Romeo, Jeep, Iveco and Suzuki.
Beyond the headline cases: independent diesel testing
Not every excess involved hidden software. German motoring club ADAC found that the Volvo S60, Renault Espace Energy and Jeep Renegade exceeded the European nitrogen oxide limit by more than 10 times in normal driving. The biggest deviations came from Volvo, Renault, Jeep, Hyundai, Citroen and Fiat. Since 2016, 38 of 40 diesel cars that ADAC tested failed a nitrogen oxide test.
Researchers argued that the rules themselves were inadequate and pushed for the UN-sanctioned Worldwide harmonized Light vehicles Test Procedure, which better reflects real driving. It came into force only in 2017, and critics say carmakers lobbied hard to delay it because meeting tougher controls was expensive. Daniel Dalton, who steered the new European legislation, called the old rules patchy at best and ineffective at worst.
The rules themselves came from a long public-health effort. California set standards in 1966 and the US Clean Air Act followed in 1970. From 1975 to 1996 carbon emissions fell by 76.3 per cent, and studies estimate that the policies averted 19,008 deaths.
The other Volkswagen controversies
Diesel is the largest entry in a longer list. On the environmental side, Volkswagen set seven environmental goals in 1996, revised in 2002 and 2007, and was the first manufacturer to apply ISO 14000 at the drafting stage. Greenpeace criticised its opposition to tighter CO2 rules in 2011. The 2013 XL1 was billed as the world's most fuel-efficient production car, at a claimed 0.90 L/100 km (261 mpg), though ordinary driving gave about 1.96 L/100 km (120 mpg). In 2015 the group also admitted that certain engines carried software to reduce CO2 during approval testing. For model year 2017, Volkswagens sold in the United States averaged 26.5 mpg, about 6 per cent better than the all-maker average.
History produced others. In 2015, activists and former employees in Brazil accused the company of silence over the persecution of workers during the country's military dictatorship from 1964 to 1985; security staff had passed information to the political police, mass arrests occurred in 1976 and some employees were tortured. In September 2020 Volkswagen settled with Brazilian state prosecutors for 36 million reais (US$6.7 million). In 2019, chief executive Herbert Diess twisted a Nazi-era slogan into a joke about profit at an internal event, and said Volkswagen carried a special responsibility tied to the Third Reich years. A 2020 commercial that appeared to show a racial slur drew criticism, and after a first defensive reply the company apologised.
The Xinjiang question has run longer. The Australian Strategic Policy Institute named Volkswagen in 2020 as one of the firms benefiting from potentially abusive labour transfers of Uyghur workers. The company hired a Shenzhen law firm to audit its factory, and the Financial Times reported in September 2024 that the audit fell short of international standards. In June 2022 Lower Saxony, the anchor shareholder, and the head of the union IG Metall called on the company to act, and in November 2024 it announced the sale of its Xinjiang operations.
The most recent entry is about connected-car subscriptions. In 2023 a sheriff's office in Lake County, Illinois, said a stolen 2021 Atlas with a two-year-old boy inside could not be tracked at first because the Car-Net subscription had expired and the service wanted $150. The car and child were reported found just after officers paid. Volkswagen called it a serious breach of process and offered 5 free years of Car-Net tracking for most model year 2020 to 2023 vehicles.
What dieselgate means if you own or buy a diesel
A software update is not always the end of the matter: DUH's Cayenne still exceeded its limit afterwards. Manufacturers dispute many findings, so a claim and an outcome are different things; Mercedes and BMW have denied defeat devices, and Fiat Chrysler admitted no liability. Real-world figures can sit well away from label figures, as the 179 against 241 g/km Cayenne comparison shows.
What followed dieselgate
Volkswagen's stated direction since the scandal has been electric. The November 2016 announcement targeted 1 million electric Volkswagens by 2025, with 3 million for the group, according to the company, alongside the manager's statement that diesels would not return to the United States. DUH has asked for a full register of defeat devices and for repair or refunds, and has said it will pass its measurements to law enforcement and the European antitrust authority. The UK class action against Fiat Chrysler was filed in October 2020, and the Xinjiang sale was announced in November 2024.
