The scandal that has engulfed Volkswagen in the US over using a so-called “defeat device” to sidestep emission standards is shaping as a global setback for diesel-powered cars.
The makers of diesel-power cars have marketed them as being “greener” than petrol-power because they get better mileage, and produce less carbon dioxide.
However, diesel-engines produce more overall air-pollution because they emit more nitrogen oxides and small particulates, which are linked to health risks such as respiratory conditions such as asthma.
The US Environmental Protection Agency has alleged that some Volkswagen and Audi diesel cars included software that circumvented EPA emissions standards for certain air pollutants.
It has alleged that a sophisticated software algorithm on certain Volkswagen vehicles detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test.
“This results in cars that meet emission standards in the laboratory or testing station, but during normal operation, emit nitrogen oxides, or NOx, at up to 40 times the standard,” the US EPA said.
In Australia, the Department of Infrastructure and Regional Development says it is monitoring developments in the US and their implications for VW vehicles sold in Australia.
“The Department is seeking urgent clarification from Volkswagen Group Australia, as to whether vehicles supplied to the Australian market use similar software to that used in the US,” a spokesperson said.
The Australian Competition and Consumer Commission says it is not yet clear on what representations were made by VW to Australian consumers on vehicle emissions.
“The ACCC is making enquiries to determine if consumers might have been exposed to misleading claims,” said a spokesperson. “The ACCC is also considering the rights of consumers under the Australian Consumer Law.”
An international investment manager and researcher, Bernstein, has argued that the scandal “probably does” signal end of diesel, which would have most impact in Europe where more than half of new cars have diesel engines.
“The move against VW is going to act as a catalyst to speed up the fall in diesel market share in Europe and halt it the US,” Bernstein said in a note to clients.
“In fact, regulators will not be much more conservative about what they permit and much tougher real-world tests may either produce too difficult – or too expensive – for diesel to meet.”
Diesel power on the rise in Australia
In July, the Australian Bureau of Statistics said about 14 million petrol-powered vehicles were registered in Australia in 2015, accounting for about 78 per cent of our total vehicle fleet.
In comparison, there were 3.6 million diesel-powered vehicles in Australia, accounting for almost 20 per cent of the fleet, including many trucks and some sports utility vehicles (SUVs).
But the ABS data shows that diesel is becoming more popular in smaller vehicles in Australia. Over the last five years, the number of diesel-powered passenger cars has grown by 96 per cent by 63 per cent in light commercial vehicles.
Two Australian public health experts, Adrian Barnett and Luke Knibbs, argued yesterday in this article for The Conversation website that diesel exhaust fumes can cause cancer in humans.
They noted that VW has said that 11 million cars could be affected worldwide but that it was unclear whether this included Australia.
The two scientists called for random on-road testing to see whether there is a problem in Australia with new diesel vehicles rorting pollution controls.
“Random tests would inconvenience a small number of people and testing two to three hundred diesel vehicles would make it clear if there was a big problem,” they said.
“It would be relatively low cost, but would need technical experts as well as the help of the police.”
In the longer term, they suggest adding a vehicle emission test to the roadworthy certificate needed to sell a car, or requiring an annual or bi-annual test of vehicle emissions as done in California and the United Kingdom.’
“Our previous research showed that when the price of diesel fell in Brisbane there was an increase in air pollution across the city likely driven by increased use, whereas there was no increase in air pollution for cheaper petrol,” they said.
“Ideally, there would be no diesel vehicles in urban areas except for people who truly needed them for work. The mayors of Paris and London have both expressed a desire to rid their cities of diesel vehicles.”
“The main source of exposure to poor quality air for many city-dwelling Australians is traffic pollution. Cleaning the air by increasing the number of cleaner vehicles has the potential to greatly improve health, including reducing asthma admissions to hospital, reducing strokes and even deaths.
“Having more dirty diesel vehicles on the road is about the worst thing that could happen in Australian cities. VW has a lot of questions to answer.”
VW share price plummets
The scandal has already hit the VW share prices and has raised broader questions about whether safety and quality problems multiply when global car makers get too big.
Toyota overtook General Motors in 2009 to become the world’s number one car maker. This year, VW overtook Toyota in top spot.
Then consider that Toyota last year agreed to pay $US1.2 billion to settle claims that it concealed a problem in its vehicles that caused them to accelerate suddenly, which was linked to 12 deaths in the US.
This month, General Motors agreed to pay $US900 million for its handling of an ignition-switch defect in the US that was linked to 124 deaths from regulators and the public.
VW has seen its share prices slashed, but has yet to feel the full repercussions of the scandal. The same is true for diesel.