Costs are rising. Time to pay up.
As the dust around the Dieselgate scandal begins to settle, the bills are starting to add up, and Porsche appears to require some assistance in paying the piper. A German newspaper reported that the performance-luxury marque has submitted a request to sister-company Audi for some €200-million (or AU$303-million) to cover costs related to the emissions scandal.
To recap, the Dieselgate scandal erupted in 2015 when it was discovered that the Volkswagen Group had employed a program encoded within the engine management systems of its diesel passenger vehicles to work around tightening emissions regulations in North America. Since then, it’s been discovered that this software was used around the globe, with relevant agencies in multiple markets citing serious discrepancies between reported figures during testing and real-world results.
The software was developed by a team at Audi headed by Wolfgang Hatz in the early 2000s, and proved to be so effective that Hatz was eventually promoted to the engine R&D boss for the larger VW Group by Martin Winterkorn following the latter’s appointment as chairman of the Group in 2011. Hatz later joined Porsche as a board member focused on research and development, and spent four years in the role before he resigned after the emergence of the emissions-cheating software.
Hatz was arrested in Germany late last month for his involvement in the scandal, and Martin Winterkorn resigned shortly after the software was exposed.
As of today, the Volkswagen Group has paid out over US$30-billion as a result of the fallout over the scandal, with recalls executed for four-cylinder, V6, and V8 diesel motors fitted with the software. Porsche was hit specifically earlier this year when the German transport ministry issued a stop-sale order on diesel variants of its Cayenne luxury SUV due to emissions discrepancies, with minister Alexander Dobrindt stating that two Cayennes his ministry tested had gone into a ‘warm up strategy’ mode shortly after detecting that it was being put through regulatory testing.
That stop-sale notice also came with a demand for a recall, affecting some 22,000 German-market Cayenne diesels that would require a software update that would regulate its emissions more stringently. Aptly, Porsche union boss Uwe Hück made comments aimed directly at its Ingolstadt sister company, saying that Audi was responsible for the issues being faced by Porsche.
“We feel deceived by Audi. The supervisory board should fire the management.” — Uwe Hück, Porsche Workers Union
To those comments, the VW Group CEO Matthias Müller struck back at Hück, saying that his comments were “anything but helpful” and that the supervisory board “certainly needs no lecturing on how it has to do its job.” A report in German publication Hadelsblatt did however suggest that the supervisory board is considering the dismissal of up to four Audi management members as a direct result of the scandal.
It’s worth mentioning that the report of the €200-million bill was carried by Bild in Germany but did not mention a source, though it did clarify that the money would be used to cover the costs of retrofitting affected cars, paying for legal counsel, and compensating customers. A Porsche spokesman responded to queries by Reuters saying that internal matters at the VW Group are not meant for public discussion, while Audi took a stronger approach and simply declined to comment.
Stay tuned to CarShowroom as we bring you updates as they come.
