Germany orders scandal-hit VW to recall 2.4 million vehicles


German authorities tightened the screws on Volkswagen on Thursday, saying they would order it to recall 2.4 million vehicles across the country that are fitted with pollution-cheating software.

As the embattled auto giant continues to struggle to resolve its deepest-ever crisis, the authorities appear to be losing patience.

“We are going to issue the order” to recall 2.4 million vehicles, a spokesman for the KBA or federal transport authority told AFP.

And to make sure that order is carried out, the KBA would oversee the operation, he added.

VW, the world’s biggest carmaker in terms of sales, was plunged into a crisis of global proportions last month, when it was forced to admit that it had fitted 11 million diesel cars worldwide with devices aimed at cheating pollution tests.

The revelations rocked the automobile sector around the world and cost VW Chief Executive Martin Winterkorn his job.

In addition to the costs of recalling so many vehicles, the once-respected automaker now faces billions of dollars in potential fines and legal costs, not to mention the still incalculable fallout in terms of lost sales and customer trust.

The company has set aside €6.5 billion in the third quarter, but new Chief Executive Matthias Mueller said that would likely only meet repair costs.

Last week, VW put forward a plan to begin recalling the vehicles from January 2016.

Neither the KBA nor the German transport ministry had commented so far on VW’s road map to solve the scandal.

But Transport Minister Alexander Dobrindt told journalists in Berlin that given the scale of the recall action in Germany, it was right that the KBA oversee it.

“The dimensions mean that monitoring and oversight are necessary,” Dobrindt said.

Previously, the number of cars in Germany that had been equipped with the pollution-cheating software had been put at 2.8 million.

The slightly reduced number of 2.4 million reflected the fact that some of those vehicles were no longer on the road, Dobrindt explained.

The KBA had given VW until the end of October to come up with the technical solution for the 2-liter diesel engines, where a simple software change would suffice, the minister continued.

For the 1.2-liter and 1.6-liter engines, the carmaker had until the end of November to present its solutions.

According to the mass-circulation daily Bild, the German authorities were running out of patience with VW and felt the carmaker’s own proposals for a voluntary recall were not enough.

But minister Dobrindt told reporters that VW was cooperating “constructively,” while the auto giant for its part was not immediately available to comment.

Ties between politicians and the auto industry are traditionally very close in Germany and politicians have been reluctant to attack VW openly since the scandal broke, as it is seen as a flagship of German industry and is a major employer. The regional state of Lower Saxony where VW is headquartered holds a stake in the group.

VW chief Mueller said last week that the recall would begin in January and take the rest of the year to complete, angering groups such as environmental activists Greenpeace for taking too long.

But Dobrindt confirmed the timetable on Thursday, not least because the technical solutions for the 1.2- and 1.6-liter engines would only be ready for installation in September 2016.

Numerous national probes have been launched across the globe as investigators seek to find the masterminds and culprits behind the scam.

Aside from the millions of vehicles affected in Germany, more than 1 million could be hit in Britain and nearly a million in France.

According to the weekly magazine Der Spiegel, as many as 30 VW managers could be implicated in the affair, while VW dismissed that number, insisting that only a “small group of people” were involved.

But the scandal could also have wider repercussions for the German economy as a whole and its pristine engineering reputation, some experts fear.

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