
What really happened at Volkswagen - tormeh
http://www.economist.com/news/books-and-arts/21722818-why-emissions-scandal-still-hangs-over-german-carmaker-what-really-happened-vw?fsrc=scn/tw/te/bl/ed/thevolkswagenscandalwhatreallyhappenedatvw
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payne92
Regarding the other comments here: this is a book review, not a general
analysis of emissions cheating.

I am about halfway through the book right now (so far, very highly
recommended).

There is a lot more in the book than is captured in this review. VW's history
is extremely interesting, and the company has unique organizational aspects
(even by German standards).

And related, an excellent, detailed technical summary of cheating
implementations, including the historical evolution across manufacturers:
[https://cseweb.ucsd.edu/~klevchen/diesel-
sp17.pdf](https://cseweb.ucsd.edu/~klevchen/diesel-sp17.pdf)

~~~
Tomte
"Unique" is very right:
[https://en.m.wikipedia.org/wiki/Volkswagen_Act](https://en.m.wikipedia.org/wiki/Volkswagen_Act)

------
msnower
The "autocratic" management style seems to be the biggest cause of this issue.
I'd be surprised if members of upper management didn't have a sense of what's
going on.

It reminds me of the events leading NASA Challenger disaster. The engineers
and lower management employees were totally ignored by upper management in
that scenario.

Though, I should mention, I haven't read any books about the VW scandal yet.

~~~
Animats
_The "autocratic" management style seems to be the biggest cause of this
issue._

Unclear. The author of the book takes that position. The author seems to be
hostile to worker ownership or state ownership.

Companies with multiple classes of stock to deprive the stockholders of voting
control can have a much worse autocratic leader problem. Google and Facebook
are set up that way, of course. Here's the list of the 28 S&P 500 companies
with restricted voting rights.[1] As a group, they underperform the full S&P
500. Some of those companies that aren't doing well face shareholder
litigation. Viacom's minority shareholders did manage to get rid of Sumner
Redstone, but he was 93 and really had to go.

For many decades, no big company did this, because the NYSE didn't allow such
companies to be listed. (Except for Ford and Hershey, which predated that
rule; they were grandfathered in.) It's still rare, but now companies can get
away with it.

[1]
[https://s.thestreet.com/files/tsc/v2008/photos/contrib/uploa...](https://s.thestreet.com/files/tsc/v2008/photos/contrib/uploads/a982bf14-396f-11e6-8a30-933f82343784.JPG)

~~~
blazespin
I wonder if there is a dropoff in returns for companies with voting control.
Google and FB have been pretty good in their early years so far.

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mnm1
Like VW is the only company that cheated on emissions? Fiat Chrysler, Daimler,
GM, Mitsubishi, Renault, and the list keeps growing. The interesting story is
why the whole industry is allowed to get away with cheating. And it's got
nothing to do with Hitler.

~~~
macintux
In fairness, the violations in the other cases I've seen (and I admit I
haven't paid all that close attention) seem to be much more marginal.

~~~
rasz
There was a program on national French TV almost a full year before VW case
blew up, they tested PSA, Renault and Fiat cars and _every single one_ was
several times above the norm.

also [http://www.cnbc.com/2017/04/24/reuters-america-
update-1-fren...](http://www.cnbc.com/2017/04/24/reuters-america-
update-1-french-prosecutors-open-peugeot-diesel-cheating-probe.html)

------
Kluny
The first couple paragraphs is light-on-facts shade throwing. I didn't read
the rest. My first impression was not one of even-handed journalism.

~~~
logicallee
what the hell is "throwing shade"? I've seen this expression crop up
everywhere but literally only in the past few months. Is it new? Recent surge
in popularity? What is this.

~~~
SeanBoocock
Gimlet Media's "Reply All" podcast has a fascinating episode partially devoted
to the etymology of "yass", "throwing shade" and other phrases:
[https://gimletmedia.com/episode/69-disappeared/](https://gimletmedia.com/episode/69-disappeared/)

~~~
logicallee
thanks. I listened to the relevant part.

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asmithmd1
When I first heard about the cheating I saw VW engineers (both management and
practitioners) as totally at fault. I thought they were directly detecting
that the vehicle was undergoing a test and modifying the engine computer in
response. I later found out they were changing the computer algorithm only
when the inputs to the throttle and gearshift matched the test protocol. To me
this seems like a legitimate way to "cheat." They are using TDD and are
passing the test. The test writers should have thrown in a secret or random
test as well as the pre-defined tests.

~~~
nathanvanfleet
Laws don't work that way

~~~
asmithmd1
In this case the law is written precisely like a unit test:

[https://en.wikipedia.org/wiki/New_European_Driving_Cycle](https://en.wikipedia.org/wiki/New_European_Driving_Cycle)

[https://en.wikipedia.org/wiki/FTP-75](https://en.wikipedia.org/wiki/FTP-75)

The problem with the testing is that it also followed the exact same unit
test. I have not read the law, but they certainly violated the spirit of the
law if not also the letter.

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wiz21c
FTA :

>>> He delves into VW’s origins, when Adolf Hitler ordered the construction of
a “people’s car”, or Volkswagen in German. VW set up shop in the German
countryside. Wolfsburg bred a “headquarters mentality” that insulated the firm
from outside influence. Unprecedented union power, handed over in the 1960s as
the price the federal government paid for floating the firm on the
stockmarket, and the sway of the state of Lower Saxony, which retained a 20%
voting stake in the company, gave outside shareholders little say.

So basically, union power and government involvement (and lack of private
investors) lead to cheating ?

come on...

~~~
LoSboccacc
no, it's in your quote, Hitler did it /s

that's just some comtext blurb, you're extrapolating too much out of it

~~~
wiz21c
>>>> Unprecedented union power, handed over in the 1960s as the price the
federal government paid for floating the firm on the stockmarket

Unless I'm missing something, this is roughly 15 years after Hitler
disappeared. Or my english skills are truly fading away :-(

------
rurban
Oh no, another VW hit piece, attacking the biggest US competitor.

It is definitely NOT what really happened with the emissions scandal, as it
omits the most important facts, how this cheating scandals began, and how it
spread out.

The first emission cheating scandals happened with US carmakers, then the US
and EU emission testing laws deviated, allowing the US to cheat with their
drivers, giving national carmakers the advantage, whilst EU and Asia committed
to reproducible tests. But only on one model out of R&D, and not every single
engine coming out of production. And then of course the tricks began to detect
the tests, probably at Audi (certainly not VW), with Bosch being the one who
needs to take the blame. They implemented it. Then many others detected the
same tricks, and either used the sophisticated cycle detection in the Bosch
ECU or used simplier timers. In the last list I saw 50% of all tested engines
cheated with the NOx emissions, and VW was not even at the top of the numbers.

~~~
matt4077
Hello! Just the other day I argued that the EU's new antitrust case against
Google isn't economic nationalism, so allow me to even the score :)

VW's conduct both in implementing these cheats, as well as resisting the
investigations into them (to this day!) was obviously, morally indefensible,
and totally stupid. Health statistics put the most likely number of premature
deaths caused by it somewhere in the 4-digits, in the US alone.

The absolute amount of the fine must have punitive component large enough to
make it obvious that such crimes don't pay. At the same time, it wold have
been unconscientious to level a fine that would bankrupt VW. I believe the US
did a pretty good job.

It also shows a deep misunderstanding of the processes by which the Federal
Government works. These fines are not determined by some Trump-like egomaniac
impulsively acting on his emotions. Nor is the EPA known to be a fan club of
US car manufacturers.

Why only VW? It's quite easy: these manipulations are really only relevant to
Diesel engines, which for some reason became a fetish for manufacturers in
Germany only. VW sells more Diesel cars in the US than all other companies
together.

~~~
rurban
Whow, so many mistakes.

"VW's conduct both in implementing these cheats": No Bosch implemented these
cheats. If there was help or demand from outside, it was Audi, not VW.

"Why only VW? VW sells more Diesel cars in the US than all other companies
together."

The fines should be on all manifacturers of the cheaters. From the list of the
affected engines I see not a single one being targeted. The relevant VW
engines are all manifactured by Audi, the relevant cheats were manifactured by
Bosch, the other relevant cheaters involve everyone: Audi, Daimler, BMW,
Skoda, Volvo, VW, Jaguar, Land Rover, Citroen, Mazda, Peugeot, Hyundai, KIA,
Toyota, Ssangyong, Infinity, Fiat, Ford, Mitshubishi, Seat, Vauxhall,
Chevrolet, Dacia, Honda, Nissan, MG, Porsche, Renault, ... you name it.
[https://www.theguardian.com/business/2016/apr/23/diesel-
cars...](https://www.theguardian.com/business/2016/apr/23/diesel-cars-
pollution-limits-nox-emissions)

Only those 7 diesel cars meet the Euro 6 NOx limits, the other 97% not.

    
    
      * Audi	A5	2014
      * BMW	3 Series	2013
      * Skoda	Superb	2016
      * Volkswagen	Golf SV	2015
      * Volkswagen	Passat	2016
      * Volkswagen	Scirocco 2015
      * Volkswagen	Touran	2016
    

Note that this mostly consists of VW cars meeting the limits, all others not.
A good technical overview is summarized here:
[http://www.theicct.org/sites/default/files/publications/ICCT...](http://www.theicct.org/sites/default/files/publications/ICCT_NOx-
control-tech_09032015.pdf)

