StupidiNews Focus: What Zee German Knew

We take a closer look at this moning's StupidiNews story finding Volkswagen execs knew about the company's diesel emissions cheating devices back in May 2014, that comes from a NY Times story today by international business reporter Jack Ewing.

Volkswagen internal memos and emails suggest that company executives pursued a strategy of delay and obfuscation with United States regulators after being confronted in early 2014 with evidence that VW diesel vehicles were emitting far more pollutants than allowed.

The documents, first reported on by the German newspaper Bild am Sonntag and since reviewed by The New York Times, could raise the penalties for Volkswagen based on laws requiring public disclosure of problems with potential to affect a company’s stock price. They indicate that top managers knew sooner than they have acknowledged that they could not bring tainted vehicles into compliance with air-quality rules, but led federal and California officials to believe otherwise.

The documents also raise the possibility that Martin Winterkorn, Volkswagen’s chief executive at the time, knew of possible emissions cheating by the company sooner than he has said.

According to the documents reviewed by The Times, a confidant of Mr. Winterkorn wrote to him in May 2014, warning that regulators might accuse the carmaker of using a so-called defeat device — software that recognized when the car was being tested for emissions and activated pollution-control equipment. At other times, the cars produced up to 35 times the allowed amount of nitrogen oxide emissions, which are linked to lung ailments and premature deaths.

It was not until last September, more than a year after the letter of warning to Mr. Winterkorn, that Volkswagen admitted publicly that 11 million diesel vehicles, including about 480,000 Volkswagen cars in the United States, were equipped with defeat devices. The number of cars in the United States has since risen to include about 100,000 Audi and Porsche cars with diesel engines.

Mr. Winterkorn, who resigned on Sept. 23, has said he did not learn of the defeat device until shortly before the company’s public admission. A lawyer for Mr. Winterkorn did not respond to requests for comment. Volkswagen declined to comment on the documents, citing continuing investigations by German prosecutors and internal auditors.

Two people who have held senior positions within Volkswagen in recent years, and who have connections to current and former VW management, confirmed the authenticity of the documents and defended the company’s actions, saying the company had not stonewalled United States officials. The people spoke on condition of anonymity. 

That's kind of a big smoking gun deal if Winterkorn was getting emails about the cheating devices nearly 16 months before he said he had been made aware of the problem.  It's ridiculous to think that the company's CEO wasn't made aware of a project of this scope and magnitude, for cheating devices to be installed in all of its US diesel models for several model years.

Winterkorn is in enough trouble, this report suggesting that he knew more than a year in advance before the story broke means he could be in even more of the stuff, and I don't think Germany's legal system is going to be very kind to him, given EU rules on business ethics.  And that's before the US gets a hold of what's left.