In 2015, the United States Environment Protection Agency (EPA) issued a notice of violation of the clean air act to the German automobile giant, the Volkswagen group. A scandal ensued and it was discovered that the company had programmed its cars all across the globe to meet regulatory air pollution standards during testing, but would produce up to fifty times more pollution in real time driving.
The cars were programmed to display lower outputs of emission while they were tested. After being sued, Volkswagen decided to settle and agree to pay a $15 billion settlement, and agreed to fix the issue in its cars worldwide.
Recently, following the settlement with the US authorities, Volkswagen faced similar appeals from countries in Europe, who demanded an equivalent settlement. Europe’s Industry Commissioner Elzbieta Bienkowska called on VW to reimburse owners of its diesel cars in Europe. The argument was that it would improper, not to mention unfair, for European owners to be treated otherwise just because of a different legal system.
Matthias Mueller, CEO, Volkswagen AG, rebuffed the request for any such US-like settlements in Europe. He told a German newspaper tha such a settlement on the entire continent would not only be costly, but also ‘inappropriate’.
Mueller claims that the situation in the United States was much different as the laws there were much stricter and as a result the solution was equally complex. Moreover, processes like buyback, while optional for customers in the US, are not available to customers in Germany.