VW Management Knew About Emissions Issue a Year Before Scandal Broke

Volkswagen's top brass was informed of illegal practices involved with its diesel car production almost a year before the emissions scandal went public.

In a March 2 statement, the automaker admitted that former CEO Martin Winterkorn was told of the "emissions cheating" software in a 2014 email. The issue became public in September 2015.

"On 23 May 2014, a memo about the [International Council on Clean Transportation-sponsored] study was prepared for Martin Winterkorn, then-chairman of the management board of Volkswagen AG. This memo was included in his extensive weekend mail. Whether and to which extent Mr. Winterkorn took notice of this memo at that time is not documented," the auto manufacturer said. The statement came in response to a suit by shareholders.

Another memo discussing defect issues was issued in November 2014, the company said, but neither of these memos would necessarily served as tip-offs for the looming emissions scandal. "According to current knowledge, the diesel matter ... was treated as one of many product issues facing the company," not as an indication of the scope of the issue at the time, the company said.

The statement further clarifies that Winterkorn and Volkswagen Chairman Herbert Deiss were both briefed of the problem before the news broke. In July 2015 that year, VW executives attended a company meeting that focused on "damage and product issues," in which the emissions software was discussed. It wasn't until August 2015, however, when they met with technicians, that the executives realized the installed software "constituted a prohibited defeat device under U.S. law" and took steps to inform the Environmental Protection Agency and the California Air Resources Board.

VW's public statements on who knew about and authorized the use of emissions-cheating software have expanded over the past year. In October 2015, VW America CEO Michael Horn said in a U.S. congressional hearing that the software was installed by "a couple of software engineers who put this in for whatever reasons," and that the company had not been able to identify the individuals. "This was not a corporate decision, from my point of view, and to my best knowledge today," Horn told representatives of the Congressional Energy and Commerce Committee.

According to the most recent release, the company has begun to narrow down who may have made the final decision to install the software in select models. It has not yet explained, however, how or why the a manufacturer with global oversight of its green policies and technology could have been unaware of an installed device that would dramatically change the performance of its most popular flagship models.

Image: Rocco Demas