Volkswagen’s consumer and pollution fraud crisis expanded to astounding levels on Tuesday when the German car manufacturer announced that 11 million of its cars were fitted with diesel engines that had been designed to cheat emissions standards. The news comes after last Friday’s stunning revelation that nearly 500,000 VW cars sold in the U.S. had been outfitted with these engines and would need to be recalled.
The company announced it plans to set aside 6.5 billion euros ($7.2 billion) to confront the problem. As the New York Times reported, the company made 12.7 billion euros in profit last year and its stock tanked by around 20 percent for a second straight day on Tuesday.
The cars affected by the recall in the U.S. include Golf, Passat, Jetta, and Beetle models from 2009-2015 equipped with 2-liter diesel engines. These engines had software that would recognize emissions evaluations and turn on an emission control system during the regulatory tests, but kept them off during normal driving spewing up to 40 times the allowed amount of the smog-causing pollutant nitrogen oxide.
More from the Times:
Volkswagen did not immediately disclose where else in the world the other cars have been sold, but many are thought to be in Europe—where the use of diesel engines is much higher than in most other parts of the world, and where Volkswagen has sold many cars containing the tampered engines, known as Type EA 189 engines. The company said on Tuesday that “a noticeable deviation between bench-test results and actual road use was established” for the engines.
In a statement, Volkswagen said that it “does not tolerate any kind of violation of laws whatsoever” and it would try to “win back lost trust and to avert damage to our customers.”
The Times also reported on Monday how the Environmental Protection Agency played a crucial role in getting the company to admit the intentional fraud:
VW made the admission only when the Environmental Protection Agency took the extraordinary action of threatening to withhold approval for the company’s 2016 Volkswagen and Audi diesel models, according to letters sent to company officials by the E.P.A. and California regulators.
A Seattle law firm announced on Monday that it was filing a class-action lawsuit on behalf of clients in 20 states—and that it planned to cover the entire country by the end of the week—for allegedly fraudulently marketing the cars to consumers as "clean diesels.”