Exclusive California Agency Rejects Volkswagen Recall Plan

The Californian Air Resources Board, a key U.S. agency that has been at the center of Volkswagen’s “Dieselgate” scandal, on Tuesday said it has rejected the carmaker’s recall plans for cars that had emission-rigging devices installed and was preparing the groundwork for what could be a major fine. The CARB agency issued a “notice of violation” to VW and said it was rejecting the automaker’s recall plan for 2-liter diesel engines installed in cars sold in California between 2009 and 2015. VW has admitted it sold about 600,000 cars in the United States with devices that artificially lowered their nitrous-oxide emissions during tests. Some 11 million cars around the world are affected. “Volkswagen made a decision to cheat on emissions tests and then tried to cover it up,” CARB Chairwoman Mary Nichols said in a statement. “They continued and compounded the lie and when they were caught they tried to deny it. The result is thousands of tons of nitrogen oxide that have harmed the health of Californians. They need to make it right. Today’s action is a step in the direction of assuring that will happen.” CARB and the U.S. environmental agency EPA have led efforts to uncover the scandal, which first broke in September. The EPA has joined a civil lawsuit filed by the U.S. Justice Department that could theoretically demand as much as €48 billion in penalties from the carmaker, according to Reuters calculations. CARB said VW’s recall plan did not contain enough detail and did not “adequately address” the impact of the so-called “defeat devices” on the vehicles’ overall performance and emissions output. The agency said its actions “do not preclude a recall, but allow for a broader array of potential remedies.” That includes possibly penalties against the Wolfsburg-based company. A Volkswagen spokeswoman in the United States said that the company is currently reviewing CARB’s decision, and stressed that the rejection affected the initial recall plan submitted in December. Since then, she added, the company has been in continuous talks with authorities. “We are committed to working cooperatively with CARB and other regulators, and we plan to continue our discussions tomorrow when we meet with the EPA,” she wrote in a statement. The rejection of its recall plan comes as VW Chief Executive Matthias Müller was in the United States this week to meet with policymakers and try to restore the carmaker’s reputation in the country.   Read more in Wednesday’s Handelsblatt Global Edition at 12:00 CET.