[BartSimpson]

No link. The source material is in German and behind a paywall.

$1:

The German auto scandal just got much bigger according to a new report by the Spiegel.

Audi, BMW, Daimler, Volkswagen, and Porsche colluded in all aspects of diesel technology.

Effectively, the five corporations acted as one via a series of secret working groups that met several times a year.

The Spiegel broke the story with its report on the Auto Syndicate Scandal.

The story is in German, and it’s also behind a pay wall. Eurointelligence has a nice Email report:

Spiegel magazine has an absolutely shocking account of a cartel between the five motor companies – VW, Daimler, BMM, Porsche, and Audi. The original article is worse than any summary we have read because of the many details the two authors have dug up in a large investigation. Coming on top of the diesel emissions scandal, the reputation of the German car industry has been reduced to that of a criminal organization. Unlike the authors, we are less worried about the fines, which will be large, than about the long-term commercial impact.

This is one of the largest cartel cases in German history. The meetings started in the 1990s. The car makers created 60 working groups, each specializing on a different part of the car. For example, they agreed on the maximum speed at which a sunroof opens or closes while the car is in motion, or the maximum size of the tank for the AdBlue chemical which reduces certain toxic emissions. There were working groups for brake systems, for seats, for suspension, for clutches, and naturally also for diesel and petrol engines.

The working groups met several times a year in the cities where the car companies have their HQ’s, like Munich, Stuttgart, or Wolfsburg; as well as during the large European motor shows in Frankfurt, Geneva, and Paris. They also held teleconferences in between meetings. They were quite cocky. An Audi email reads:

“Hello everybody, please find attached the date for the ‘secret’ meeting in Munich.”

The authors, two of Germany’s most renowned business journalists, said the cooperation has gone so far that these companies can no longer be regarded as in competition with one another but as a single Deut­sche Au­to­mo­bil AG.

All the companies, except BMW, have admitted the meetings when questioned by the EU Commission and the Federal Cartel Office.

When industries decline, this type of behavior is very common in the penultimate phase. The industry profits are still high. The companies are still benefitting enormously from past inventions and product developments. As we now know, the German car industry was able to maintain their predominance beyond the natural sell-by date through a cartel. They are approximately at the same stage where Detroit was just before 1967.

The problem with the German car industry specifically is that they bet the house on diesel technology, and used their influence on the German government to prevent more stringent testing of emissions. The function of the cartel was to maintain profit margins, and in particular to secure the predominance of the diesel technology.

The German public had an extraordinary degree of trust in the industry, partly also because German auto journalists failed to do their job since they were part of the cartel.

The next ten years will see two significant developments, for which the German car industry is not prepared: one is the gradual switch towards hybrid and electrical engines, and the other is the advent of artificial intelligence. The German car industry has a lot of patents for electric engines, but they are globally not the leading force. And now their reputation is tarnished.

We don’t expect rapid falls in sales immediately but see an unrecoverable loss of reputation in the long-term because we are confident to predict that the industry will not clean up the mess it has created. Rather, it will seek a cover-up or direct protection from the government. The tendency will be to sit this out, and the government will avoid an open confrontation given the many jobs that depend on that industry. This may delay the onset of a crisis for a while, but will ultimately accelerate it.

Merkel to the Rescue?

Massive fines are on the way but Merkel will do whatever she can to reduce the fines and the impact.

The amazing thing to me is how long these corporations got away with this.

Trust is lost and diesel is toast. The latter was true even without this latest scandal.

[BartSimpson]

One nice thing out of this is one of my wife's childhood friends who has a 'clean diesel VW' and who used to look down her nose at us plebians with our gas-powered Volvo has been remarkably silent the past few years.

Also on the upside: No more having to suffer while driving behind some stinky diesel compact.

[DrCaleb]

A little story by Der Spiegel:

http://www.spiegel.de/wirtschaft/sozial ... 59052.html

and some more bits in English:

http://www.motortrend.com/news/vw-plead ... ettlement/

It's fun to watch people getting caught cheating on an exam.

[Canadian_Mind]

I hope diesel cars are toast. Would be nice to see diesel's price drop a bit.

[BartSimpson]

DrCaleb DrCaleb:

A little story by Der Spiegel:

http://www.spiegel.de/wirtschaft/sozial ... 59052.html

and some more bits in English:

http://www.motortrend.com/news/vw-plead ... ettlement/

It's fun to watch people getting caught cheating on an exam.

Interesting is that it looks like the German government is involved, too. The auto companies needed government help to defraud the EU.

Merkel defrauding the EU.

Heh.

[raydan]

Nothing to see here... move along... just the price of doing business.

[herbie]

So guess what's coming next?
Diesels that use gasoline...

[DrCaleb]

herbie herbie:

So guess what's coming next?
Diesels that use gasoline...

They'll just scrap the oil burner, and go straight to full electric.

[raydan]

DrCaleb DrCaleb:

herbie herbie:

So guess what's coming next?
Diesels that use gasoline...

They'll just scrap the oil burner, and go straight to full electric.

...and burn coal to produce the electricity.

[DrCaleb]

raydan raydan:

DrCaleb DrCaleb:

herbie herbie:

So guess what's coming next?
Diesels that use gasoline...

They'll just scrap the oil burner, and go straight to full electric.

...and burn coal to produce the electricity.

Easier to control emissions when they are centralized than from millions of tailpipes. Besides, much of non-nuclear Europe is transitioning to renewable. So there will be a greater benefit in the future.

[herbie]

raydan raydan:

DrCaleb DrCaleb:

herbie herbie:

So guess what's coming next?
Diesels that use gasoline...

They'll just scrap the oil burner, and go straight to full electric.

...and burn coal to produce the electricity.

Or hopefully there will be people not as stupid as Trump and we can use that LNG that they won't be exporting in the interim and the power from Site C it was gonna get for under market price.

[Freakinoldguy]

Apparently Volkswagen isn't the only miscreant to doctor their emissions programming to get the result they want.

The following are under investigation for doing the same thing.

$1:

Daimler:

In February of this year, a group of U.S. Mercedes owners filed a class-action lawsuit, alleging that the automaker's BlueTEC diesel-powered vehicles shut off their emissions controls in real-world driving. A second class-action suit filed in April characterized the software as a "defeat device" akin to Volkswagen's TDI cheat.

Fiat:

In February of this year, a group of U.S. Mercedes owners filed a class-action lawsuit, alleging that the automaker's BlueTEC diesel-powered vehicles shut off their emissions controls in real-world driving. A second class-action suit filed in April characterized the software as a "defeat device" akin to Volkswagen's TDI cheat.

PSA and Renault:

In early January, French antifraud authorities raided Renault headquarters after testing inspired by Volkswagen's diesel debacle found many Renault diesel models emitted more than the legally permissible maximum in real-world driving. Officials found no evidence of a "defeat device" after searching engineers' computers, though the automaker recalled nearly 16,000 European-market diesel-powered SUVs and offered a "voluntary" software fix to reduce the NOx emissions of nearly 700,000 diesel-powered vehicles.

Meanwhile, French rival PSA, maker of Peugeot and Citroën, faced near-identical antifraud raids by the same agency in April, triggered by similar real-world emissions test findings. France's antifraud office, known as DGCCRF, set up a commission in October 2015 to test 100 vehicles produced by that nation's auto industry in response to the discovery of Volkswagen's TDI cheat. Both Renault and PSA claim to be cooperating with authorities.


Opel:

General Motors German brandcame under fire in mid-May of 2016, after a joint investigation by German news magazine Der Spiegel, ARD television program Monitor, and the environmentalist group Deutsche Umwelthilfe discovered software on diesel-powered Zafira minivans and Insignia sedans that turns off emissions controls during real-world driving. Opel CEO Dr. Karl-Thomas Neumann released an initial statement denying "any illegal software" and insisting that "our engines are in line with the legal requirements;" later, Opel published a lengthy and in-depth statement explaining why the software discovered by the investigation is technically legal.

And astoundingly, while the software does indeed turn off the affected vehicles' emissions controls in most real-world driving scenarios, as Bertel Schmitt points out at Forbes, the software is likely to be found 100-percent compliant with European Union laws.

http://www.roadandtrack.com/new-cars/ca ... -cheating/

The others on this link are there for lying about their MPG which is just about as bad. So if you think that the practice of cooking the results is a Volkswagen phenomenon you're sadly mistaken and after a little research I discovered almost every auto maker is guilty of something along the same lines, including the vaunted Japanese brands.

https://www.extremetech.com/extreme/216 ... e-vehicles

[bootlegga]

Canadian_Mind Canadian_Mind:

I hope diesel cars are toast. Would be nice to see diesel's price drop a bit.

I had a 2006 Jetta TDI (not one of the newer clean diesels) and it was incredible - lots of get up and go, great fuel economy and comfortable for road trips. In the summer, diesel usually drops to lower than regular gasoline, so the fuel savings are even better.