Volkswagen faced its first Congressional hearing over the diesel emissions scandal today. Michael Horn, the CEO of VW's American division, appeared in front of the House of Representatives' Energy and Commerce Committee, and spent most of the hearing deflecting questions and denying that the company had knowledge of the so-called "defeat devices" that were used to cheat EPA emissions tests dating back to 2009.
Instead, Horn claimed the defeat devices were put in place by a few rogue software engineers. "This was not a corporate decision, from my point of view, and to my best knowledge today," he said. "This was a couple of software engineers who put this in for whatever reasons." Volkswagen has not been able to identify who these individuals might be, or even how many would have been involved in the scheme, according to the CEO.
"This was not a corporate decision."
Many committee members took umbrage with this explanation, with representative Chris Collins (R-NY) calling it "inadequate" and "a sign of arrogance." (Collins asked no questions, and spent his allotted five minutes lecturing Horn, saying that the entire Volkswagen organization is either "incompetent" or "complicit... in a massive coverup.")
Horn began the hearing by reading his official statement, which was published yesterday afternoon. But there was one key difference. The original statement intimated that Horn and other VW employees had known about the defeat device since the spring of 2014, when a West Virginia University found a discrepancy between the stated emissions levels of certain Volkswagen cars and their real-world performance. Horn said that, at that time, he "was told that there was a possible emissions non-compliance that could be remedied." This morning, he added a very defensive clarification to that statement.
"Let me be very clear about this," Horn told the committee, "while I was told about the EPA process, I was not then told, nor did I have any reason to suspect or to believe, that our vehicles included such a [defeat] device." He then returned to reading his statement. Horn later said that he didn't learn about the defeat devices until a company meeting "around September 3rd" of this year, but could not give an exact date. (News of the scandal broke on September 18th.)
Our explanation of the Volkswagen emissions scandal.
Horn held firm on his claims through a mix of questioning and outright tongue-lashing from nearly 20 members of the House's Energy and Commerce Committee. He continually denied that he or other Volkswagen executives had any knowledge that the company's cars were cheating emissions tests, and spent most of the two-hour hearing deflecting the committee members' questions — sometimes with confusing and contradicting responses.
At one point, Horn was asked if he knew how the defeat devices work. "Personally, no. I’m not an engineer," he responded. Later, in response to a similar question, Horn was suddenly able to describe how the defeat devices were able to fool the EPA's tests, and mimicked turning a car's steering wheel. (One of the ways the offending software was able to recognize whether a car was being tested or not was to monitor the amount of movement in the steering wheel.) More than once, Horn asked committee members to repeat themselves, claiming that noise in the room was stopping him from understanding their questions.
The affected cars can be fixed, but performance may suffer
Horn said he is certain that Volkswagen will be able to fix the affected cars in order to comply with emissions standards, and that after the fix the cars will still be able to achieve the MPG rating labeled on their Monroney sticker. But customers with affected cars should expect a "slight impact" on performance after the fix. "Maybe, on top speed, one or two miles per hour may be missing," Horn said. When he was asked about the harm that the cars have done to the environment (some of the affected cars were found to release up to 40 times the accepted level of nitrogen oxide into the atmosphere) Horn claimed that these cars make up a fraction of the total amount of cars on US roads — a defense that he quickly followed by saying he's "not belittling [the impact], and it’s clearly unacceptable."
The impact of the scandal on customers wasn't the only focus of the hearing. Many of the committee members were focused on how it affects Volkswagen dealers and service shops across the country, with representative Diana DeGette (D-CO) going so far as to call out a Volkswagen dealer who attended the hearing. Horn said that the company has provided every dealer around the US with a discretionary fund, but would not disclose the amount, only saying "it's a significant amount of money." These funds give the dealers financial flexibility, Horn said, and will allow them to solve "the most urgent customer cases." Dealers can use those funds to offer customers loaner cars, or do "whatever they think is best" for each specific customer’s situation, "no questions asked," Horn said.
VW gave American dealerships discretionary funds to placate customers
"I’m damn sincere about this," Horn said. "The dealer profitability in this country is my first objective." Horn did state, however, that there is no plan to buy back the affected cars.
Horn also spoke about Volkswagen's plans going forward. Most of the affected models — 400,000 or so — will likely need five to ten hours of servicing to disable the defeat device and produce the correct emissions. But that process could take at least one or two years, Horn said, and there's no clear picture of when the repairs will begin.
Until that happens, Volkswagen's deceptive diesel vehicles will stay on the road. The Energy and Commerce committee's investigation will continue, and Volkswagen is conducting its own internal investigation, which has led to the suspension of three executive-level employees. Meanwhile, the EPA has warned automakers that it is "stepping up" its emissions testing going forward.
Correction: This article incorrectly stated that Rep. DeGette brought her personal mechanic and dealer Fred Emich to the hearing. DeGette referred to Emich as "my wonderful dealer" during the hearing, but she does not own a Volkswagen. Emich is a major Volkswagen dealer in DeGette's district.