VW’S CEO was told about emissions software months before scandal - Der Spiegel

Volkswagen Chief Executive Herbert Diess was told about the existence of cheating software in cars two months before regulators blew the whistle on a multi-billion exhaust emissions scandal, German magazine Der Spiegel said.

Der Spiegel’s story, based on recently unsealed documents from the Braunschweig prosecutor’s office, raises questions about whether VW informed investors in a timely manner about the scope of a scandal which it said has cost it more than US $ 27 billion in penalties and fines.

The Braunschweig prosecutor’s office was not reachable for comment on Saturday.

Volkswagen’s senior management, which has denied wrongdoing, is being investigated by prosecutors in Braunschweig, near where Volkswagen is headquartered, to see whether the company violated disclosure rules.

U.S. regulators exposed VW’S cheating on September 18, 2015.

Responding to the magazine report, the carmaker reiterated on Saturday that the management board had not violated its disclosure duties, and had decided to not inform investors earlier because they had failed to grasp the scope of the potential fines and penalties.

Citing documents unsealed by the Braunschweig prosecutor’s office, Der Spiegel said Diess was present at a meeting on July 27, 2015 when senior engineers and executives discussed how to deal with U.S. regulators, who were threatening to ban VW cars because of excessive pollution levels.

Diess, who was VW’S brand chief at the time, became chief executive of Volkswagen Group in April this year. Volkswagen also owns the Scania, Skoda, Audi, Porsche, Bentley, Bugatti, Lamborghini and Ducati brands.

The U.S. Environmental Protection Agency (EPA) had found unusually high pollution levels in VW’S vehicles and was threatening to withhold road certification for new cars until VW explained why pollution levels were too high. Diess, who had defected from BMW to become head of the VW brand on July 1, 2015, joined the July 27 meeting with Volkswagen’s then Chief Executive Martin Winterkorn to discuss how to convince regulators that VW’S cars could be sold, a VW defence document filed with a court in Braunschweig in February, shows.

Volkswagen on Saturday said both Winterkorn and Diess declined to comment given the ongoing proceedings. A spokesman for Martin Winterkorn declined to comment on Saturday. Winterkorn’s lawyer Felix Doerr, could not be reached for comment.

Following this meeting, Winterkorn asked Diess whether BMW too had installed “defeat devices” in its cars, Der Spiegel said.

In the United States, legal engine management software is described as an “auxiliary emissions device” while the term “defeat device” is used to describe only illegal software.

Diess is said to have answered that BMW had not made use of such software, Der Spiegel said.