In this report: High-level four-ring emissions-cheating board-level retards at Audi jump in the pool and swim for Dieselgate gold
UPDATE: Four days after this video was published, the Australian Federal competition watchdog, the ACCC, began Federal court proceedings against Audi Australia, Audi AG and Volkswagen AG for allegedly deceptive dieselgate conduct.
Read the release here >>
Check out more on this incredible pan-global scandal in my exclusive reports:
- How Volkswagen Betrayed the World >>
- Dieselgate temper tantrum >>
- VW in Oz: the case for 'don't buy' >>
Explosive testimony in an obscure German labour court places Audi CEO Rupert Stadler at the centre of the dieselgate scandal spotlight, and might see him don the golden parachute and take the walk of CEO shame past the Zyclon B canisters, the showers, and down the long hall to gilt-edged obscurity.
I’m John Cadogan, the founder of AutoExpert.com.au - the place where Aussie new car buyers save thousands on their next new car. Hit me up here >> for that.
And now, for the latest on those emissions-cheating Teutonic four-ring mother-lovers:
ENGINEER DROPS THE BOMB
Ulrich Weiss, a leading diesel development engineer at Audi, was put on ice in November 2015 in the wake of dieselgate - suspended with full salary of nearly US$500,000, so not exactly thrown in a cell at Gitmo.
Audi finally fired Mr Weiss in mid-February, along with three other Audi engineers. But Mr Weiss wants his cushy Audi powertrain engineering job back. And in this German labour law courtroom skirmish Mr Weiss recently deployed a dieselgate gravity bomb.
And by ‘dieselgate gravity bomb’ I mean a document he’d stored for safe-keeping - literally, in a safe - that indicated Audi CEO Rupert Stadler ordered engineering bigwigs like Mr Weiss to cheat emissions laws in Hong Kong - at exactly the same time US investigators were getting to the bottom of dieselgate. What unfortunate timing, with the benefit of hindsight.
Q7 TAKES THE PISS
The problem was the the big, fat, stinking Q7, which belched much more than the mandated maximum oxides of nitrogen for Hong Kong regulators to approve. The Q7 drank Adblue - also known as urea - like a piss-thirsty sailor on shore leave.
We’re talking eight incredible litres of glorified piss to clean up the Q7’s emissions - every thousand kilometres. That’s a lot of sexed-up piss.
I’m tipping nobody in the market for a Q7 likes to think too hard about that, or worse, make - literally - a piss stop at the dealer every couple of weeks. No matter whose kidneys it was ultimately filtered through.
(This week’s flavour: Homeless man...)
Allegedly, Audi’s head of powertrain development, Dr Thomas Heiduck, turned the thumbscrews on Mr Weiss, demanding an engineering cheat to cure the Q7’s overenthusiastic capacity to imbibe glorified piss. Weiss pushed back and demanded the order to cheat, in writing.
Dr Heiduk went into hurried conference with Audi’s top sociopaths (personal opinion) … it’s probably better to call them what they are: board members. Dr 'Duk apparently returned in due course with the documentary gravity bomb - a signed directive to cheat that apparently implicates not just Audi CEO Rupert Stadler, but also board members Ulrich Hackenberg (Mr R&D), Werner Zimmerman (Quality Assurance) and Michael Neumayer (product management).
You sociopathic shitheads. (Personal opinion.)
There’s never a good time for this kind of expose, of course. But seeing as Hong Kong is actually part of China now, and seeing as Audi’s sales are circling the drain in China following dieselgate (down 35% year on year for January), and seeing as Rupert Stadler seems to have caused this problem...
And seeing as Audi is currently at war with its Chinese dealers, who want $4 billion in compensation to cover their recent losses, it seems to me Audi could soon be prospecting for a new CEO. Do you have what it takes?
WANTED: NEW CEO?
The successful applicant would ideally demonstrate several years of success at board level in a related criminal enterprise. Experience trading illicit drugs or weapons would be favourably viewed, but those with a strong track record in other organised crime fundamentals such as gambling, human trafficking and/or money laundering would also be considered.
The successful applicant must pass a standardised psychology test and meet Audi’s exacting minimum requirements for sociopathy and narcissism. Strong capacity for delivering pathological lies will be a viewed as a distinct advantage.
Of course, those burdened by normal human levels of empathy or a profound sense of social justice need not apply.
AUDI OZ's: BREATHTAKING BULLSHIT
In its effort helpfully to contextualise the scandal to Australian customers, under the rubric of ‘What Happened?’, Audi Australia explains on its website, below. (But allow me to translate, because the language is nothing short of outrageous bullshit. Starting with the term: ‘what happened’ - what a disingenuous chunk of downplaying bullshit. But - full points - for an attack by stealth that so neatly sidelines any obligation for humility, apology or contrition. Personally I think: ‘How we tried to fuck you over, but got caught’ might be more honest.)
Audi Oz Version:
“Software installed in the engine control units of some Audi vehicles fitted with an EA189 diesel engine permitted different nitrogen oxide emissions (NOx) depending on whether the vehicle was operating under a laboratory test cycle or operating outside of the test cycle.”
“We took the board-level management decision that emissions laws didn’t simply apply to us and therefore we pumped up the toxic emissions in our diesels, prioritising our profit over your health, and we remain very, very sorry we got caught.”
That’s fair and balanced. And I have to say: Audi must hate having anything related to dieselgate on its website. It’s only there to ameliorate potential new customer concerns.
So if you are on the cusp of being seduced by the glorified Volkswagen that is the four rings, realise that this is a company completely unafraid to break the law and poison you if it means more profit for them.
PROFIT & PRODUCTION
One of the major communications imperatives for the Volkswagen Group has been, and remains, to distance Audi from the dieselgate scandal. And that’s purely down to protecting the profit. Because Audi punches so incredibly far above its weight in the Volkswagen profit stakes.
In 2014, the Volkswagen Group sold 10.2 million vehicles in total - across all the brands - and it made 11.1 billion Euros in profit. Audi’s share of production was just 1.8 million vehicles - but the profit was a massive 5.2 billion Euros. So Audi generates 47 per cent of Volkswagen Group’s profits, and it manages to do that with just 18 per cent of the cars.
And that’s why it’s so important to Volkswagen to distance Audi from dieselgate. If Audi can emerge squeaky clean - or at least at arm’s length - almost half the profit is safe.
If you’re not big on mathematics, it’s like this: If you take Audi out of the Volkswagen Group’s balance sheet, they’re making an average profit of about $1100 Australian dollars per car. And if you think about Audi in isolation, it’s making $4400 Australian dollars in profit per cer, on average.
Audi is four times as profitable - per car - on average, compared with the rest of the Volkswagen Group. This is why the Volkswagen Group is doing everything it can to keep Audi apparently at arm’s length from this morally reprehensible scandal - even though Audi is actually in it up to its neck.
Annual production, 2014: 10.2 million vehicles
Share of production:
100 per cent
Profit, 2014 (Euros):
Share of the profit:
100 per cent
Profit per vehicle (Euros):
Annual production, 2014:
1.8 million vehicles
Share of production:
18 per cent
Profit, 2014 (Euros):
Share of the profit:
47 per cent
Profit per Audi (Euros):
Frankly it’s amazing how far you can pump up the price of a Volkswagen Golf when you primp its hair and makeup, and slap four rings on, front and rear. And then sell it to upmarket idiots as an A3. Audi is absolutely critical to the Volkswagen Group’s profits during this fiasco.
An immense gulf separates the the truth when it comes to vehicles like the Audi A3 and Volkswagen Golf. If you landed here this morning from Alpha Centauri. you would not be able to tell them apart - except of course for the price. The same car, essentially - only nearly $10,000 more if you want the four rings up the pointy end.
That's an incredible 30 per cent more ... and it's nearly all profit.
What a pity, then, that the golden parachute of anonymity - the gilt-edged non-disclosure agreement - was not extended to Ulrich Weiss, the engineer with the signed gravity bomb, in German labour court. Marched to the end of the plank, not with a gun at his head, but by virtue of a document that seems to indicate board level collusion to prioritise profit over health. Again.
But you have to admire Audi: daring enough to lightly restyle a Volkswagen Golf and quadruple the profit. Unafraid to vorsprung durch technik the shit out of internal combustion - even if it means killing people like you in the process. Confident to believe they are well above the law of any nation-state.
You have to wonder: how many more gravity bombs are out there? The glossy marketing, the purported green credentials, the emotional outreach to customers. And on the other side of the ethical Grand Canyon: a stark landscape where the only imperative is pumping up the profit, at any cost. I’m pretty sure this is a ‘smoke/fire’ situation, metaphorically.
8 MARCH UPDATE:
ACCC TAKES AUDI AND VOLKSWAGEN TO COURT
ACCC takes action against Audi over diesel emission claims
8 March 2017
The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against German company Audi Aktiengesellschaft (Audi AG), its Australian subsidiary Audi Australia Pty Ltd (Audi Australia), and their owner, German company Volkswagen Aktiengesellschaft (VWAG).
The ACCC alleges that Audi AG and Audi Australia engaged in misleading or deceptive conduct, made false or misleading representations and engaged in conduct liable to mislead the public in relation to certain diesel vehicle emission claims, and that VWAG was knowingly concerned in this conduct.
The ACCC alleges that between 2011 and 2015:
Audi AG engaged in misleading conduct by not disclosing the existence and operation of ‘defeat’ software in certain Audi branded vehicles. The software caused the vehicles to produce lower nitrogen oxide (NOx) emissions when subject to test conditions in a laboratory than during normal on-road driving conditions.
Both Audi AG and Audi Australia engaged in misleading conduct by representing that the vehicles complied with all applicable regulatory requirements for road vehicles in Australia when, because of the defeat software, that was not the case.
Using information provided by Audi AG, Audi Australia marketed the vehicles in Australia as being environmentally friendly, producing low emissions and complying with stringent European standards when this was not the case under normal driving conditions.
VWAG designed and supplied the engines and defeat software to Audi AG for installation in the affected vehicles.
“Consumers expect that there is some relationship between the performance of the car as set out in the sales brochure and their day to day on-road use. We allege that the installation of software which allows the vehicle to meet testing standards but then causes the vehicles to operate differently on the road, and associated representations about the vehicle and its performance, breach the Australian Consumer Law,” ACCC Chairman Rod Sims said.
The ACCC is seeking declarations, pecuniary penalties, corrective advertising, orders relating to the future use of findings of fact and costs.
Skoda-branded vehicles are also affected by the Volkswagen diesel emissions issue. The ACCC has decided not to pursue further action against Volkswagen (which owns the Skoda brand in Australia) at this time in relation to these Skoda vehicles, noting the lower volume of sales in Australia, the continuing class actions seeking damages for affected consumers and the proceedings which the ACCC has already commenced against Volkswagen in respect of Volkswagen and, now, Audi vehicles.
Notes to editors
The Audi branded vehicles covered by these proceedings are:
- A1 3 Door – 2011 to 2013
- A1 Sportback – 2012 to 2015
- A3 Sportback – 2011 to 2013
- A4 Allroad – 2012 to 2015
- A4 Avant – 2011 to 2015
- A4 Sedan – 2011 to 2015
- A5 Cabriolet – 2012 to 2015
- A5 Coupe – 2012 to 2015
- A5 Sportback – 2012 to 2015
- A6 Avant – 2012 to 2015
- A6 Sedan – 2011 to 2015
- Q3 SUV – 2012 to 2015
- Q5 SUV – 2011 to 2015
- TT Coupe – 2011 to 2014
The Australian Design Rules implement international standards that regulate the emission of NOx from motor vehicles. NOx can cause respiratory illnesses and is particularly harmful to vulnerable consumers such as the young, the elderly, and those with pre-existing respiratory conditions.
Audi Australia has supplied more than 12,000 affected vehicles to Australian consumers.
These proceedings are in addition to the proceedings that the ACCC instituted on 1 September 2016 against VWAG and its Australian subsidiary, Volkswagen Group Australia Pty Ltd (VGA), and relate to the same alleged conduct.
The ACCC’s action against VWAG and private class actions seeking redress for consumers affected by this conduct are currently before the Federal Court.
In December 2016, VGA and Audi Australia announced the implementation of a recall designed to remediate the diesel vehicles affected by the emissions software issue. The recall involves a software update and in some cases, a minor hardware upgrade, for the affected vehicles. The recall is voluntary and if consumers choose not to have the recall update applied to their vehicle, they do not waive their legal rights under the Australian Consumer Law.
VWAG is the world’s second-largest car manufacturer by sales volume in the world. Audi AG and VGA are subsidiaries of VWAG. Audi Australia operates in Australia independently from VGA.
View this release on the ACCC's website >>