Volkswagen was Accused of Cheating US Emissions Tests by Installing Illegal Software in its Diesel Cars On September 18

Date: 2015-09-23

Abandoning NOx control to achieve high thermal efficiency

Volkswagen rigged emissions data for its diesel cars in the US and we believe the reason is not that Volkswagen lacks emissions control technologies. Facing strong competitive pressure in the US market, Volkswagen may have wished to achieve a competitive edge in engine performance and fuel economy by foresaking emissions standards.

Volkswagen hasn’t been very successful in the US market and we believe US consumers do not favor the appearance and the chassis set-up of Volkswagen’s cars. US consumers are also less enthusiastic about diesel cars compared with European consumers. Therefore, Volkswagen’s appeal to US consumers lies only in the excellent engine performance and low fuel consumption.

For diesel engines, emissions of both PM and NOx must be controlled in order to meet emissions regulations. Excess PM emissions make the vehicle’s exhaust noticably darker and more opaque, making it easy to get caught. However, NOx emissions are colorless transparent gases and excess NOx emissions are more difficult to discover. The EPA accuses Volkswagen of having NOx emissions 10~40 times the acceptable level; acceptable NOx emissions under the Euro I standard are only 8x that of Euro VI. This suggests that the NOx emissions of Volkswagen’s cars to be recalled do not even meet Euro I; in other words, Volkswagen completely abandoned NOx control in those cars.

The major reason why diesel engines produce NOx emissions is that oxygen and nitrogen undergo a chemical reaction during combustion under high temperature and high pressure. The excessive NOx emissions of Volkswagen’s diesel cars suggest that Volkswagen set its diesel engines’ working conditions under extremely high pressure and temperature; combustion under high pressure and temperature can help improve thermal efficiency, leading to better fuel economy.

Organizational behavior instead of individual behavior

The use of two separate control procedures for laboratory testing and actual consumer driving has become an open secret in the auto sector. Therefore, testing procedures were also modified to increase the difficulty for software to identify testing procedures.

Under normal circumstances, R&D staff don’t have the motive to take such risks. We believe that installation of this kind of “special-purpose software” in the engine control system requires the collaboration of the marketing department, product R&D and quality control at least. Therefore, Volkswagen’s fraud scandal should be considered organizational behavior rather than individual behavior.

After the scandal, Volkswagen also started an external investigation, which further suggests that Volkswagen’s management realizes this is an organizational problem.

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