Volkswagen installed software to cheat on emissions tests

In September 2015, the U.S. Environmental Protection Agency (EPA) discovered that Volkswagen had deliberately programmed diesel engines to produce false results during emissions testing. The software, called a "defeat device," detected when a car was undergoing a standardized test and switched the engine to a low-emissions mode. Once testing ended and the car returned to normal driving, the engine switched back to a high-emissions mode that violated federal pollution limits by up to 40 times.

Volkswagen sold approximately 11 million vehicles worldwide with this software between 2009 and 2015. The company initially claimed the discrepancy was a technical error, but internal investigations later revealed the deception was intentional and involved engineers across multiple levels of the organization. Volkswagen eventually admitted to the fraud and faced criminal charges, civil penalties, and a massive recall.

Key Takeaways

  • Volkswagen programmed diesel engines to cheat on EPA emissions tests by automatically switching to compliant mode only during testing.
  • The scandal affected roughly 11 million vehicles sold between 2009 and 2015 across multiple Volkswagen brands including Audi and Porsche.
  • Volkswagen paid over $15 billion in fines, settlements, and buyback programs in the United States alone.
  • Owners of affected vehicles were offered buyback programs, lease terminations, or engine repairs depending on their location and vehicle model.
  • The scandal prompted stricter emissions testing procedures worldwide and increased regulatory scrutiny of automaker testing practices.

How the defeat device worked

The software monitored several conditions unique to a standardized test: the position of the steering wheel, the duration of acceleration, and whether the car was on a dynamometer (a machine that measures engine power). When these conditions matched a test scenario, the engine reduced nitrogen oxide emissions to meet legal limits. During real-world driving, the software disabled these emission controls, allowing the engine to run at higher performance and better fuel economy—but at the cost of illegal pollution.

Volkswagen engineers designed the system to be difficult to detect. The defeat device did not leave obvious traces in the engine's main computer files that regulators would typically examine. Instead, the software operated through a secondary system that was not part of standard regulatory inspections. This allowed the company to pass emissions tests for years while vehicles on the road produced far more pollution than permitted.

The discovery and investigation

Researchers at West Virginia University first noticed the discrepancy in 2014 while testing Volkswagen diesel vehicles for a study on real-world emissions. They found that cars performed far better in the lab than on actual roads. The EPA began investigating and, in May 2015, confronted Volkswagen about the gap. Volkswagen initially blamed the issue on a software calibration problem and promised a fix.

By September 2015, the EPA issued a notice of violation, and Volkswagen admitted to the intentional deception. The company's CEO at the time, Martin Winterkorn, resigned within weeks. Internal investigations revealed that the fraud involved multiple departments and had been approved at senior management levels. Volkswagen later paid criminal fines and agreed to cooperate with ongoing investigations in the United States, Europe, and other countries.

Financial penalties and settlements

Volkswagen's financial consequences were substantial. In the United States, the company paid $14.7 billion in fines and settlements between 2015 and 2018. This included a $2.8 billion criminal fine, a $1.5 billion civil penalty from the EPA, and approximately $10 billion for a buyback and lease termination program for affected vehicle owners. Additional settlements followed in other countries, bringing the global total to over $30 billion.

Beyond direct penalties, Volkswagen faced lawsuits from vehicle owners, environmental groups, and state governments. Many of these cases were settled through class-action agreements that compensated owners for decreased vehicle value, higher fuel costs, and the cost of repairs. The company also had to fund environmental remediation projects to offset the excess emissions their vehicles had produced.

What happened to affected vehicles

Volkswagen offered three main options to owners of affected diesel vehicles in the United States. The first was a buyback program, where the company repurchased the vehicle at its pre-scandal market value. The second was lease termination, allowing lessees to end their contracts without penalty. The third was an engine modification program, where Volkswagen installed software updates and hardware changes to bring vehicles into compliance with emissions standards.

The buyback and lease termination programs were more popular than the repair option, as many owners were concerned about the vehicle's long-term reliability and resale value. Volkswagen had to establish a claims administrator to process the high volume of requests. The process took several years to complete, with some owners receiving their buyback payments as late as 2018 or 2019. Owners in other countries, particularly Europe, faced different settlement terms depending on local regulations.

Changes to emissions testing after the scandal

The Volkswagen scandal exposed weaknesses in how emissions tests were conducted and monitored. Before 2015, the EPA relied primarily on laboratory testing using a standardized driving cycle that did not reflect real-world conditions. Regulators had limited tools to detect when manufacturers were using defeat devices because they did not routinely test vehicles on actual roads.

In response, the EPA and the National Highway Traffic Safety Administration (NHTSA) implemented stricter testing procedures. New regulations now include real-world driving emissions (RDE) testing, where vehicles are tested on public roads using portable emissions measurement systems. The EPA also increased the frequency of audits and inspections of manufacturer testing facilities. Many countries outside the United States, including those in the European Union, adopted similar real-world testing requirements.

Long-term impact on the automotive industry

The scandal damaged Volkswagen's reputation and forced the company to invest heavily in electric vehicle development as a way to rebuild trust. Volkswagen committed billions of dollars to transitioning its fleet away from diesel engines and toward battery electric vehicles. The company's leadership also implemented new compliance programs and ethics training across the organization.

The scandal also prompted other automakers to face increased scrutiny. Regulators began investigating other manufacturers' emissions testing practices, and several companies faced fines for similar violations on a smaller scale. The incident became a turning point in how the automotive industry approached regulatory compliance and transparency. Insurance companies and used car markets also reflected the scandal's impact, with affected Volkswagen models experiencing steeper depreciation than comparable vehicles from other manufacturers.

Frequently Asked Questions

Did Volkswagen vehicles actually pollute more than the tests showed?

Yes. On the road, affected Volkswagen diesel vehicles produced nitrogen oxide emissions 10 to 40 times higher than the legal limit, depending on driving conditions. The defeat device allowed them to pass laboratory tests while exceeding pollution standards during normal use. This meant the vehicles contributed significantly more to air pollution than their test results indicated.

Could owners have known about the defeat device?

No. The software operated invisibly to the driver and was not disclosed in any vehicle documentation, marketing materials, or owner manuals. Owners had no way to detect the deception without specialized testing equipment. Volkswagen deliberately concealed the defeat device from both consumers and regulators.

Are there other automakers that have done something similar?

A few other manufacturers faced smaller-scale violations after the Volkswagen scandal prompted increased regulatory scrutiny. Fiat Chrysler, BMW, and others paid fines for emissions violations, though none involved the scale or deliberateness of Volkswagen's fraud. The scandal made regulators more vigilant about detecting similar practices.

What happened to the Volkswagen executives responsible?

Several executives faced criminal charges in the United States and Europe. Some received prison sentences, while others settled civil cases. The company's former CEO, Martin Winterkorn, was charged with fraud but reached a settlement with German prosecutors. Other engineers and managers involved in the scheme also faced legal consequences in various jurisdictions.

How did this scandal change how cars are tested today?

Regulators now use real-world driving emissions testing in addition to laboratory tests, employ portable emissions measurement systems, and conduct more frequent audits of manufacturer facilities. These changes make it harder for automakers to use defeat devices because vehicles are tested under varied real-world conditions rather than a single standardized laboratory scenario.