Published on March 3rd, 2018 | by James Ayre0
Volkswagen: We Can’t Afford To Pay For Upgrade Of Old Diesel Car Exhaust Systems On Our Own
March 3rd, 2018 by James Ayre
The CEO of Volkswagen has been quoted as saying that while company execs aren’t “against” the retrofitting of old diesel car exhaust systems so as to make them cleaner, the company can’t afford to pay for such a course of action.
These comments of course follow on the recent ruling by a court in Germany to allow city authorities to ban diesel cars due to air pollution concerns — a ruling that the federal government is now apparently trying to downplay, owing to worries about possible effects on the wider German auto industry.
To provide a bit of explanation here, Volkswagen has faced legal actions and fines in the USA relating to the diesel vehicle emissions cheating scandal … but not in Germany, or in the EU (which Germany effectively rules). So those that took the government at their word in recent decades that diesel cars were “green” and that buying them was good for the environment have been effectively screwed over … as no compensation has been paid out to them in Germany despite being misled.
Why has no compensation been paid out to affected diesel car owners in Germany or the EU? Because of incredibly close ties between the German auto industry and the German government.
To hear the current Volkswagen CEO Matthias Mueller tell it: “I would compare hardware changes on a Euro-5 vehicle to an open-heart surgery. We had to pay about €25 billion in America, we cannot again pay €17 billion for hardware refits. That is simply not possible.”
So, effectively, the Volkswagen exec is saying that they can’t be held accountable in Germany because they’ve already been held accountable in the US … and they’ll cease to exist if they’re held to account in Germany as well.
That noted, Mueller did say that the company wasn’t “ruling it out” either.
Reuters provides more: “Hardware changes would cost between €1,500 ($1,845.30) and €7,000 per car, and the development as well as testing of new exhaust cleaning systems would take 2-3 years, Mueller said.
“Also, retrofitted vehicles might consume more fuel and emit more carbon dioxide, which would affect the level of car tax, he added. Of the 15 million diesel cars on Germany’s roads, only 2.7 million are equipped with the latest Euro-6 emissions technology. Research firm Evercore ISI has estimated that upgrading the exhaust cleaning of the 6 million Euro-5 vehicles could cost up to €14.5 billion ($17.9 billion).”
I’ll note here that Mueller’s estimate of 2–3 years of system development time assumes that truly effective retrofits are actually possible at the price points discussed above. A better option from the consumer perspective would simply be for Volkswagen to buy back all of the affected vehicles in question in Germany, but we know that is never going to happen — and would amount in practice anyway simply to a state-funded buyout.