The Impact Of VW’s Emissions Deception Continues To Unfold

Recently, Volkswagen made major headlines based on allegations that the automaker purposefully avoided complying with emissions laws by using a software trick. The Environmental Protection Agency (EPA) announced that it had issued a notice of violation to VW, saying that the company broke the Clean Air Act by utilizing their software to cheat emissions tests.

Now, the EPA has stated its plans for sweeping changes to the way that it tests for diesel emissions, with many claiming that the agency’s current methods are predictable and outdated. It appears that the discovery of VW’s deception over seven years has prompted the EPA to reconsider its methodology for the future.

What impact is VW’s admission having on auto dealers?

Certainly, local dealerships and consumers are being forced to deal with the aftermath of this revelation. One dealer, Teton Volkswagen in Idaho Falls, says that it will continue selling cars, but not diesel vehicles. The dealership says that it has been told to halt sales of all 4-cylinder diesel models until VW comes up with a fix.

Mario Hernandez, owner of Teton Volkswagen, says that consumers who bought an affected turbo-diesel model shouldn’t, however, be concerned about the drivability of their car. “This is not a safety recall, the cars are safe to drive,” explained Hernandez. “This is just an emissions recall.”

Hernandez says that the fix for the emissions issue should come soon, and VW may in fact issue the solution through a simple programming re-flash. Owners will receive a letter in the mail once the fix is available at their local VW dealer.

“Volkswagen is going to do the right thing, they’re going to correspond with the consumer,” he said. “As a dealer, we’re going to be here to help implement a fix as soon as possible.”

Back in April, VW sent letters to California owners of diesel-powered Audis and Volkswagens to inform them of an “emissions service action” affecting the vehicles. Owners were told that they would need to take their cars to a dealer for new software to ensure that tailpipe emissions were “optimized and operating efficiently”. However, the company didn’t explain that it was taking action in the hope of satisfying government regulators, who were growing increasingly skeptical about the discrepancies between laboratory emissions test results and real world pollution coming from VW’s diesel vehicles.

However, now that VW’s CEO has admitted to rigging emissions tests, and a criminal investigation is underway, the lawsuits are starting to pile up. For one, a Seattle-based law firm, Hagens Berman, filed a lawsuit seeking class-action status within hours of the EPA’s press conference to announce its allegations of VW’s cheating. The firm said that it subsequently filed an additional suit that includes clients in 20 states, and it expects to have all 50 states represented soon. This shouldn’t be difficult considering the massive scope of a case that involves a staggering 482,000 diesel cars.

“The half-a-million people who own these cars are furious, and with good reason,” said Steve Berman, managing partner of Hagens Berman. “Not only did they pay more for something they never received, but they’ve been victim to a tremendous act of deception.”

It’s expected that many more lawsuits will follow, and there’s no question that it’s going to take a lot of time and effort for VW to sort out this massive mess. Auto analysts are projecting that while U.S. new-car sales will hit a pace in September that has not been seen in 15 years, VW won’t be joining the party. Instead, the German automaker is expected to be the sole major car company to take a hit in September, as the fallout from its emissions testing deception continues in the U.S. and overseas. The problem will even spread to people who already own any of the affected diesel-powered VWs if they try to unload their new problem on the resale market.

TrueCar projects that sales by VW brands will fall a combined 5.2% in September, while overall industry sales will advance 12.6% in comparison to September 2014. And Edmunds.com estimates that VW and Audi sales will fall 2%, versus a projected 13.9% gain in industry sales overall from September 2014.

Clearly, the discovery and admission of VW’s deception has become a public relations nightmare for the automaker, and the full impact of this scandal will continue to unfold over the coming period.