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Regulators reject Volkswagen plan to fix 3.0L diesel vehicles

When Volkswagen announced its massive buyback operation last month, the company sounded an optimistic note that it would be able to field a fix for its entire fleet of vehicles. That optimism is looking more tenuous these days now that CARB (the California Air Resources Board) has issued statements publicly rejecting VW’s proposed fixes for Audis, Volkswagen, and Porsches.

According to the letters, VW has failed to provide a remedy plan that would address the underlying problems with its noncompliant systems. It has not fully disclosed how its defeat device functions, fully described the function of its proposed remedy, meaningfully estimated how many vehicles will be brought in for repair, specified how VW will ensure an adequate supply of replacement parts to affected customers, disclosed how the proposed remedy will impact the vehicles in question, described the impact of the repairs on post-repair emission levels, demonstrated how the proposed fixes will resolve the problems, or “provided sufficient detail for CARB to evaluate the feasibility and success of the proposed plan.”

While this pair of letters are focused on the estimated 85,000 3.0L engine vehicles that remain on the road worldwide (16,000 of which are in the US), CARB’s dismissal of VW’s proposed plan is similar to the reasons the group dismissed the 2.0L plan VW proposed in February. According to CARB, it’s literally impossible for VW to complete its proposals expeditiously as “certain required data will not be available until early August 2016 for Generation 2.2, mid-October 2016 for Generation 2.1, and until the end of December 2016 for Generation 1.” These “generations” refers to specific models of Audi produced between 2009 and 2016.

It’s not clear how VW’s potential repair for the 2.0 series is progressing or whether the company will be approved to bring such a repair to market. The issues surrounding the 3.0L engines seem as though it could take months to resolve them, since CARB notes that data won’t be available until the end of the year. No information is available yet on how many VW owners are going to take a buyback offer as opposed to holding out for a solution, and the company’s stockholders are likely to want the matter resolved as quickly as possible.

Unfortunately for VW, resolution may still be months or years away. German regulators publicly stated this week that they would not extend leniency or consideration to the company, despite the record-breaking fines it faces in the United States. German regulators have long been cozy with the company, which employs tens of thousands of German citizens — we’ve previously discussed how the European Union’s diesel emission standards were amazing on paper, but virtually ignored in real life. That’s not going to shield the company now — too much anger and public attention has been focused on the issue. Volkswagen could face hundreds of millions in Euros worth of additional fines, not counting potential class-action lawsuits in the US and Europe or litigation brought by countries like South Korea, which is conducting its own investigation.

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