Nearly a month before the Dieselgate scandal blew up around Volkswagen, senior managers were told the automaker could face more than $20 billion in penalties for installing and using the illegal software in its vehicles. The software enables its diesel cars to meet U.S. emissions standards.
According to the German news weekly, Der Stern, the VW brand chief, and the automaker’s purchasing chief attended a meeting on Aug. 24, 2015, where they were apparently told of the software problems. Stern, quoting people knowledgeable of the meeting of the VW brand management board, identified Herbert Diess, VW’s brand chief, and Francisco Javier Garcia Sanz, purchasing chief, as the executive who were told that illegal software was installed in diesel cars in the United States.
The automaker, when asked about the report, refused a direct answer to the newspaper’s question. VW preferred to call the Stern information “pure speculation,” also saying that any conclusions that were drawn were only subjective depictions of events at the meeting.
On Sept. 18, nearly a month after the meeting detailed by Der Stern, the Environmental Protection Agency (EPA) issued a Notice of Violation (NOV) to Volkswagen. The NOV charges VW knew of the illegal cheatware installed on its vehicles. Now known as Dieselgate, the announcement has turned into the worst scandal in the auotmaker’s near-80-year history.
So far, Dieselgate has cost several top managers their positions, including the former Volkswagen Group chief executive Martin Winterkorn. Lately, Dieselgate has also claimed the highly regarded Michael Horn, head of VW of America. Also, several engineers and mid-level managers have also been suspended in the ongoing scandal.
Meantime, VW has spent part of this month dodging shareholder lawsuits. The automaker said top management did not violate any market disclosure requirements. VW has also taken action to defend against lawsuits claiming that it had been slow in informing its shareholders about the rigged emissions software.
Investors have filed dozens of suits in Braunschweig reginal court. The suits claim VW failed to disclose the rigged software and emissions tests, even after the automaker had already admitted a so-called defeat switch had been installed.
Interestingly, though several managers have lost their positions, Diess and Garcia Sanz have retained their positions at Volkswagen. They were not available for comment.
Reuters provided the information for this story.