VW Australia speaks out over ‘dieselgate’

VOLKSWAGEN Group Australia (VGA) managing director Michael Bartsch has criticised the local media’s handling of the diesel emissions scandal and lashed out at lawyers leading a federal court class action against the company.

He also said federal authorities were to blame for the delay in fixing affected vehicles, not VGA.

Speaking at a media event in Sydney this week, Mr Bartsch sought to clarify Volkswagen Australia’s position on the diesel emissions issue that broke late last year, admitting the company had not communicated clearly with local media.

He emphasised that although Volkswagen used a ‘defeat’ device in several of its diesel vehicles to detect when the vehicle was being emissions-tested and then distort its performance to show a lower NOx reading, even the lower readings met or exceeded Australian emissions regulations.

“We are at the moment saying very clearly, the situation in the United States is very different to that of Australia,” he said. “For better or worse, Australia’s emissions standards are EU4.

“I think that it was easy to grab the lines out of the United States to say that exhaust emissions were 30 times higher than what it should have been without terribly much gone into looking behind what that means.”

Mr Bartsch used the example of the affected diesel-powered Amarok ute, which was required to meet EU4 emissions standards in Australia that he claimed meant emitting fewer than 390 grams of NOx per kilometre.

Left: VGA managing director Michael Bartsch.

“We actually brought the Amarok into Australia under EU5 standards with a maximum of 280 (g/km),” he argued.

“If you look at the homologation papers of that car it was putting out a NOx level of somewhere between 220 and 230. When we (software) reflashed that car and we took the bypass software out that is the issue of contention, it still put out 220 to 230.

“That motor in the United States requires a NOx output of 30 grams per mile driven – so you can see that you have two very different standards.”

Mr Bartsch said he therefore rejected claims made by the class action lawsuit put forward to the federal court by legal firm Maurice Blackburn, which seeks monetary compensation for owners as is being offered in the US.

“It’s a reality that entrepreneurial litigation is a fact, it’s something that we have to live with … (but) we do not believe that our cars have or will have ever broken any environmental standards in Australia,” he said.

“We don’t believe that our customers have materially lost anything or will have lost anything once the fix is implemented.

“We reiterate that we think the best interest for our customers is served by having these cars fixed. There will be no loss for our customers if we are allowed to get on with this fix.”

Mr Bartsch added that “whether or not the bypass system here is illegal in Australia is something we will defend it will be a matter for the courts to determine”.

When asked whether owners were entitled to compensation because, had they requested a NOx figure from the company at the time of purchasing an affected diesel vehicle, they would have been given an incorrect figure, Mr Bartsch replied: “To the best of my knowledge we’ve never published NOx figures.”“Let’s assume that someone did ask for the NOx output, then I would say, the onus, the responsibility on our part is to fix it, and that’s what we have to do,” he said.

Mr Bartsch further rejected claims from the class action that customers should be compensated for a loss in resale values.

“There is no question that in November, December, January (2015), residual values dropped,” he admitted.

“Why? Because there was still a big question mark over what this all means. If you look at residual values now they are no different to the normal residual values. There is no material loss in residual values that we can see.”

Mr Bartsch said the class action did not accurately reflect the mood of affected Volkswagen customers, claiming that of approximately 4500 Amarok diesel customers that have been involved in the voluntary recall campaign since February, there has been a single complaint.

“The entire approach on class actions is not exactly done on a level where there is this high level of understanding and buy in, it is a fishing expedition, and in Australia class actions are as such … that the class action is a class action, what one person (says) applies to everybody,” he said.

“I’ve spoken with a lot of people involved in the class action and their level of knowledge on it is very low … it’s simply, ‘Yeah there’s a class action, I’ll be in it.&rsquo.”

Mr Bartsch did, however, acknowledge that many owners will be “genuinely frustrated that there has been a lack of clarity (on the issue)” but argued that delays with the Department of Infrastructure and Regional Development (DIRD) and Australian Competition and Consumer Commission (ACCC) were to blame.

“There are 77 countries around the world that homologate their car under the global standardised EU protocol … 76 have acknowledged and accepted the figures that have such standards for homologation and only one country that has not yet approved it, and that’s Australia,” he said.

“We have those approvals sitting with the DIRD. Speaking with them last week with getting an update on the process I think they most eloquently said the ball is in their court.

“The process, the approval, for those 70 per cent of cars in Australia that need the work (diesel fix) is imminent, but again I want to make the point that all the information, all the data, that is required for them to approve those fixes lies with them … (and) there will be no material difference in the performance of those cars relative to what the customer is experiencing now.

“We believe that the very best solution for both the DIRD, the ACCC and for Volkswagen is to work as fast as we can to get those fixes in the market because that is the best outcome for our consumers.

“We would hope to have an outcome on the acceptance of those fixes from the DIRD in the next week or so.”

VGA announced in October last year that the total number of vehicles affected by the emissions scandal in Australia totalled 78,445 passenger and light commercial vehicles.

The Amarok has so far been the only vehicle to be recalled in Australia and of the 8694 examples impacted, about 3500 have had the issue fixed.

The fix for vehicles with the EA189 2.0-litre diesel engine involves a software upgrade performed by a VW dealer technician, but the 1.6-litre diesel will require software and hardware changes.

As well as the Amarok and Caddy van, some of the VW passenger vehicles impacted include the 2009-13 Golf, 2009-14 Polo, 2010-15 Jetta, 2008-15 Tiguan, 2008-14 Eos, 2008-15 Passat and 2008-15 CC.