Attention: TDR Forum Junkies [TABLE="width: 600, align: center"]
THE VW FIASCO
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In a TDR website conversation started on September 18 by “Wayne,” there are numerous (it keeps growing) posts under the thread, “Massive Emissions Trouble for VW.” I would encourage you to login and read the text. Great insight and discussion.
At page 4 or 5, TDR members start to wonder what it might mean to us. Stricter emissions tests? Recall notices where your registration is tied to the dealer’s performance of the recall?
My take? How about a recall notice that, if not performed, would result in a fine by the EPA direct to the owner? If this seems a little far-fetched, you may want to step back to the late ‘90s and read about some of the smoke-and-mirror kind of activity that occurs in these settlements, continue on as we investigate the past.
I really cringe when the bubble-headed bleached blonde comes on at 5 o’clock, she can tell you about the plane crash with a gleam in her eye.
It’s, interesting when people die give us “Dirty Laundry” *
* Don Henley, 1982 “Dirty Laundry”
No doubt the Volkswagen diesel/emissions news stories have your attention. As the news outlets grasp to broad-brush the diesel industry, they bring up previous industry run-ins with various government agencies. Just this morning the bubble-headed news reader proceeded to remind the audience of the “billion dollar fine levied against the big-rig manufacturers back in the late 1990’s.” I’m guessing he had to use a “billion dollar” number to get your attention. In fairness, he was only repeating the sensational headlines from back in the day.
Now we’ve only discussed the token $83 million in civil penalties. That is a far cry from $1 billion. So I went to the EPA website to research the missing $917 million. (Thank you to TDR members for the link.) Here is what the EPA press release said:
Total Settlement:
[TABLE="width: 500, align: center"]
$25 million civil
$35 million projects
$25 million civil
$35 million projects
$12.5 million civil
$12 million projects
$13 million civil
$18 million projects
$2.9 million civil
$.5 million projects
$5 million civil
$9 million projects
$83.4 million civil
$109.5 million projects
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Yes, those numbers add up to $83.4 million and $109.5 million respectively. And if you look at the definition of “projects like development of new emission-control technologies” that, my friends, is the definition of corporate research and development. Change a line item on the corporate balance sheet, and you’re good to go.
Now where is the “At least $850 million” number? That’s where fuzzy math kicks in. Here is another quote from the press release that explains the $850 million:
Got it. Let’s analyze the statement, “Estimates to introduce cleaner new engines.” If it were a new engine, I estimate that the customer paid for the technology. Acquaintances at Cummins recall that “rebuild of older engines” was not enforced. There was no recall of pickup trucks.
So the truth about the $850 million ... it looks to me like it was “paid” by the customer, but since the $850 million was an “estimate by the EPA that the manufacturers would have to spend to introduce the cleaner engines,” the $850 million was never collected by the government.
As a final footnote to this activity in the late 1990’s, in an old EPA press release I learned that the “One Billion” fine was the third significant Clean Air Act settlement from 1995 – 1999. Previously they had levied fines of $45 million for GM/Cadillac, $7.8 million against Ford $267 million against Honda. So the “One Billion” headline certainly made the news, especially in an election year.
Sorry, I couldn’t resist the easy bashing of the Volkswagen Group. Audi has been using this advertising campaign since 2007. Unlike the bubble-headed news reader report of the “misgivings of the big-rig manufacturers,” the folks at Volkswagen are in BIG trouble. Here is a news outlet that strives to keep it factual: www.thetruthaboutcars.com
What individual $25,000 fine, you ask?
Here is the legal verbiage from issue 83, page 44:
“tampering.”
Geez, this is going to be BIG!
Robert Patton
Editor, Turbo Diesel Register
THE VW FIASCO
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What I Learned at the Turbo Diesel Register (TDR) Website
Robert Patton
Editor, Turbo Diesel Register
Robert Patton
Editor, Turbo Diesel Register
In a TDR website conversation started on September 18 by “Wayne,” there are numerous (it keeps growing) posts under the thread, “Massive Emissions Trouble for VW.” I would encourage you to login and read the text. Great insight and discussion.
At page 4 or 5, TDR members start to wonder what it might mean to us. Stricter emissions tests? Recall notices where your registration is tied to the dealer’s performance of the recall?
My take? How about a recall notice that, if not performed, would result in a fine by the EPA direct to the owner? If this seems a little far-fetched, you may want to step back to the late ‘90s and read about some of the smoke-and-mirror kind of activity that occurs in these settlements, continue on as we investigate the past.
Misinformation
I really cringe when the bubble-headed bleached blonde comes on at 5 o’clock, she can tell you about the plane crash with a gleam in her eye.
It’s, interesting when people die give us “Dirty Laundry” *
* Don Henley, 1982 “Dirty Laundry”
No doubt the Volkswagen diesel/emissions news stories have your attention. As the news outlets grasp to broad-brush the diesel industry, they bring up previous industry run-ins with various government agencies. Just this morning the bubble-headed news reader proceeded to remind the audience of the “billion dollar fine levied against the big-rig manufacturers back in the late 1990’s.” I’m guessing he had to use a “billion dollar” number to get your attention. In fairness, he was only repeating the sensational headlines from back in the day.
Been There, Done That
TDR members, we’ve been there, done that. The truth about the big-rig manufacturers and the EPA and Department of Justice is found in Issue 78, page 47. Here is the story from TDR’s Jim Anderson from a book review of Red, Black and Global: Cummins Corporate History 1995-2010.
“One of the book’s chapters deals with the famous consent decree debacle of 2000, where the EPA and US Justice Department charged six engine makers with failure to meet exhaust emission standards. The whole case revolved around the single word urban in the emissions regulations that all engine makers must meet. Though the engine makers met the letter of regulations, the EPA and DOJ contended the makers did not meet the spirit of the law. However, the engine makers were fined a token civil penalty amount of $83 million and were made to provide revised engine control software that brought all existing engines into compliance, thus allowing the government agencies to save face. The makers were also required to meet the next tier of upcoming emissions standards 18 months early, which required a massive effort on their part to meet. Cummins was the only maker to do so without problems, while Caterpillar paid a penalty on every engine they built after the due date. The EPA revised their regulations to close the loophole and everybody was once again happy.”
Folklore has it that the engine’s control modules (remember, this is mid-1990’s engine control technology) knew when the truck was driving at a steady state (on the highway/interstate), and the engine’s emissions of NOx were higher in this non-urban drive cycle than the on-off throttle that the engine would see in an urban setting. In urban settings the engines met the letter-of-the-law. Additional folklore: the EPA had knowledge of these engine settings. My opinion: as evidence by the “lack of the fine” levied and the terms “directed toward research“, I would have to agree that all parties knew what was going on. Some thought the insignificant EPA/DOJ fine was a bit of grandstanding and political posturing. (There was an election later that year.)
Now we’ve only discussed the token $83 million in civil penalties. That is a far cry from $1 billion. So I went to the EPA website to research the missing $917 million. (Thank you to TDR members for the link.) Here is what the EPA press release said:
Total Settlement:
- $83.4 million in civil penalties, the largest civil penalty for an environmental violation
- $109.5 million for additional environmental projects like development of new emission-control technologies
- At least $850 million to produce significantly cleaner engines, including engines that have their emissions reduced by 80% compared to current levels 15 months before those standards are scheduled to take effect
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- Caterpillar
- Cummins
- Detroit Diesel
- Mack
- Navistar
- Volvo
- Total
$83.4 million civil
$109.5 million projects
[/TABLE]
Yes, those numbers add up to $83.4 million and $109.5 million respectively. And if you look at the definition of “projects like development of new emission-control technologies” that, my friends, is the definition of corporate research and development. Change a line item on the corporate balance sheet, and you’re good to go.
Now where is the “At least $850 million” number? That’s where fuzzy math kicks in. Here is another quote from the press release that explains the $850 million:
“In addition, EPA estimates that the companies will spend collectively more than $850 million to introduce cleaner new engines, rebuild older engines to cleaner levels, recall pickup trucks that have defeat devices installed and conduct new emissions testing.”
Got it. Let’s analyze the statement, “Estimates to introduce cleaner new engines.” If it were a new engine, I estimate that the customer paid for the technology. Acquaintances at Cummins recall that “rebuild of older engines” was not enforced. There was no recall of pickup trucks.
So the truth about the $850 million ... it looks to me like it was “paid” by the customer, but since the $850 million was an “estimate by the EPA that the manufacturers would have to spend to introduce the cleaner engines,” the $850 million was never collected by the government.
As a final footnote to this activity in the late 1990’s, in an old EPA press release I learned that the “One Billion” fine was the third significant Clean Air Act settlement from 1995 – 1999. Previously they had levied fines of $45 million for GM/Cadillac, $7.8 million against Ford $267 million against Honda. So the “One Billion” headline certainly made the news, especially in an election year.
Audi, Truth in Engineering?
Sorry, I couldn’t resist the easy bashing of the Volkswagen Group. Audi has been using this advertising campaign since 2007. Unlike the bubble-headed news reader report of the “misgivings of the big-rig manufacturers,” the folks at Volkswagen are in BIG trouble. Here is a news outlet that strives to keep it factual: www.thetruthaboutcars.com
What This Means To You?
Hopefully, not a darned thing as I don’t believe games were played with the Ram/Cummins engine. For the Volkswagen crowd here’s one to think about. Eventually the Volkswagen owner gets a recall notice to flash his ECU. He feels this would cause a hit to the car’s fuel economy and chooses not to respond to the recall. As mentioned by TDR members, several states already have performance of a recall linked to your yearly automotive registration. If not performed, I wonder if an owner becomes liable for the “individual $25,000 fine”?
What individual $25,000 fine, you ask?
Here is the legal verbiage from issue 83, page 44:
“November 1999, issue 26, pages 32-33: “Uprates, Emissions, Aftermarket Parts and Your Warranty.” This 13 year old article spells out the basics:
[*=1]Tampering with emission control devices is a violation of Section 205/203(a) of the Clean Air Act and penalties of up to $25,000 per day of violation can be levied. Did we not live through the first catalytic converters on automobiles back in 1974?
“tampering.”
Geez, this is going to be BIG!
Robert Patton
Editor, Turbo Diesel Register
