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VOLKSWAGEN’S EMISSIONS CHEATING 

ALLEGATIONS: INITIAL QUESTIONS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON OVERSIGHT AND 

INVESTIGATIONS 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

OCTOBER 8, 2015 

Serial No. 114–85 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

TIM MURPHY, Pennsylvania 

Chairman 

DAVID B. MCKINLEY, West Virginia 

Vice Chairman 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

H. MORGAN GRIFFITH, Virginia 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

JOE BARTON, Texas 

FRED UPTON, Michigan (ex officio) 

DIANA DEGETTE, Colorado 

Ranking Member 

JANICE D. SCHAKOWSKY, Illinois 

KATHY CASTOR, Florida 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

JOSEPH P. KENNEDY, III, Massachusetts 

GENE GREEN, Texas 

PETER WELCH, Vermont 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(II) 

(III) 

C O N T E N T S 

Page 

Hon. Tim Murphy, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. Diana DeGette, a Representative in Congress from the State of Colorado, opening statement ...................................................................................... 4 

Prepared statement .......................................................................................... 6 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 7 

Prepared statement .......................................................................................... 8 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 10 

Prepared statement .......................................................................................... 11 

WITNESSES

Michael Horn, President and Chief Executive Officer, Volkswagen Group 

of America ............................................................................................................. 13 

Prepared statement .......................................................................................... 16 

Answers to submitted questions ...................................................................... 104 

Christopher Grundler, Director, Office of Transportation and Air Quality, 

Office of Air and Radiation, Environmental Protection Agency ....................... 54 

Phillip Brooks, Director, Office of Civil Enforcement, Air Enforcement Division, Office of Enforcement and Compliance Assurance, Environmental Protection Agency 1

Prepared statement 2 ........................................................................................ 57 

Answers to submitted questions 3 ................................................................... 121 

SUBMITTED MATERIAL

Subcommittee memorandum .................................................................................. 77 

Comments by Vermont residents regarding Volkswagen cheating allegations, 

undated, submitted by Mr. Welch ...................................................................... 83 

Article of September 28, 2015, ‘‘Who’s Minding the Cars?,’’ by Kellie Mejdrich, 

CQ Weekly, submitted by Ms. Castor ................................................................ 88 

Letter of September 18, 2015, from the Air Resources Board to Volkswagen 

AG, et al., submitted by Mr. Murphy ................................................................. 89 

Letter of September 18, 2015, from the Environmental Protection Agency 

to Volkswagen AG, et al., submitted by Mr. Murphy ....................................... 92 

Letter of September 29, 2015, from Mr. Upton, et al., to Michael Horn, 

President and Chief Executive Officer, Volkswagen Group of America, submitted by Mr. Murphy ......................................................................................... 98 

Letter of September 29, 2015, from Mr. Upton, et al., to Gina McCarthy, 

Administrator, Environmental Protection Agency, submitted by Mr. Murphy ......................................................................................................................... 101 

1Mr. Brooks did not make an oral statement for the record. 

2Mr. Grundler and Mr. Brooks submitted a joint written statement for the 

record. 3The Environmental Protection Agency answered questions submitted to Mr. 

Grundler and Mr. Brooks. 

(1) 

VOLKSWAGEN’S EMISSIONS CHEATING 

ALLEGATIONS: INITIAL QUESTIONS 

THURSDAY, OCTOBER 8, 2015 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:01 a.m., in room 

2123 Rayburn House Office Building, Hon. Tim Murphy (chairman 

of the subcommittee) presiding. 

Members present: Representatives Murphy, McKinley, Barton, 

Burgess, Blackburn, Griffith, Bucshon, Flores, Brooks, Mullin, Collins, Upton (ex officio), DeGette, Schakowsky, Castor, Tonko, 

Yarmuth, Clarke, Kennedy, Green, Welch, and Pallone (ex officio). 

Staff present: Gary Andres, Staff Director; Sean Bonyun, Communications Director; Leighton Brown, Press Assistant; Rebecca 

Card, Assistant Press Secretary; Karen Christian, General Counsel; James Decker, Policy Coordinator, Commerce, Manufacturing, 

and Trade; Andy Duberstein, Deputy Press Secretary; Brittany Havens, Legislative Associate, Oversight; Ben Lieberman, Counsel, 

Energy and Power; Paul Nagle, Chief Counsel, Commerce, Manufacturing, and Trade; John Ohly, Professional Staff Member, Oversight and Investigations; Tim Pataki, Professional Staff Member; 

Mark Ratner, Policy Advisor to the Chairman; Chris Santini, Policy 

Coordinator, Oversight and Investigations; Dan Schneider, Press 

Secretary; Peter Spencer, Professional Staff Member, Oversight 

and Investigations; Dylan Vorbach, Staff Assistant; Greg Watson, 

Legislative Clerk; Christine Brennan, Democratic Press Secretary; 

Jeff Carroll, Democratic Staff Director; Tiffany Guarascio, Democratic Deputy Staff Director and Chief Health Advisor; Meredith 

Jones, Democratic Director of Communications, Member Services, 

and Outreach; Rick Kessler, Democratic Senior Advisor and Staff 

Director, Energy and Environment; Chris Knauer, Democratic 

Oversight Staff Director; Una Lee, Democratic Chief Oversight 

Counsel; Elizabeth Letter, Democratic Professional Staff Member; 

and Adam Lowenstein, Democratic Policy Analyst. 

OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA 

Mr. MURPHY. Thank you, and good morning. We now convene 

this hearing of the Oversight and Investigations Subcommittee on 

Volkswagen Emissions Cheating Allegations: Initial Questions. 

2 

Let me start off by saying my first car was a Volkswagen. It was 

a 1976 Volkswagen Beetle. I learned a lot about cars and internal 

combustion engines. I could take that thing apart and put it back 

together, and it actually continued to work. I did all the maintenance myself, because the Beetle and the Volkswagen had a legacy 

as the people’s car, to be people-friendly. 

I loved that car, loved it a lot, not so much as to call it Brad, 

but I loved that car. 

[Laughter.] 

But I trusted the car to get me around, and I trusted that Volkswagen would continue to build a reliable car. That word ‘‘trust’’ 

alone, as you know, is a key factor in building customer loyalty, 

and that trust is what helped the Volkswagen because we believed 

this company looked out for customers first. 

Then, just three weeks ago, car owners around the world were 

shocked to learn that Volkswagen AG, the world’s largest automaker, admitted that it installed software for a number of years 

in millions of its diesel models that effectively defeated emissions 

controls during routine driving. This news followed the Environmental Protection Agency’s public announcement on September 

18th that it had sufficient evidence to support allegations that VW 

was cheating on its emissions tests. 

As EPA reported at the time, when the cars were subject to emissions testing, the diesel vehicles switched into an operational mode 

designed specifically to pass the test and, then, switched back to 

a different mode during normal driving, a mode that emitted nitrogen oxides up to 10 and 40 times the Federal limits. 

In the United States alone, some 482,000 Volkswagen and Audi 

models were affected by the cheating software. Worldwide the software was used in an estimated 11 million vehicles involving several VW lines. 

In the wake of this apparently massive deception, the Energy 

and Commerce Committee opened a bipartisan investigation to get 

answers for the American public. This investigation will seek to understand the facts and circumstances surrounding the VW actions, 

the impact of its decisions, and related issues about emissions compliance generally. 

At this morning’s hearing we will receive testimony from the 

head of Volkswagen’s American operations, Mr. Michael Horn, and 

from EPA officials tasked with ensuring the automobiles on American roads meet Federal environmental standards. 

In addition, this subcommittee intends to pursue answers to critical initial questions concerning the troubling revelations about 

VW’s actions, what happened, who was involved, and, most importantly, why. 

Let me acknowledge that Mr. Horn is appearing before us voluntarily today, and I can say that I expect that he and the Volkswagen organization will continue to cooperate with our inquiry. 

This means providing documents and information to the committee 

as quickly as possible, including documents that have already been 

discussed publicly in connection with Volkswagen’s various Board 

meetings in Germany. 

As I said before, there are a number of core questions that we 

will begin to pursue today, both for Volkswagen and for the EPA, 

3 

most critically, what happened, who was involved, why were these 

actions taken. We also have a number of questions concerning the 

impact of these decisions on customers, family-owned dealerships, 

and the American public. 

I hope today Mr. Horn can provide some important context for 

us and expand upon the facts he represents in his testimony. We 

will look to him to explain the current understanding of VW executives about what exactly was done to these engines and was it done 

to deliberately deceive Government regulations and regulators. And 

what is VW doing to fix the problem and make whole those who 

have been affected by the actions. 

At some point prior to 2009, VW made a choice to move forward 

with engines that evidence now suggests were not compliant with 

U.S. emissions standards. The illegal software was initially deployed in the first generation of these diesel engines, which account 

for approximately 340,000 of the affected vehicles. However, despite apparent advancement in their emissions control systems in 

two future generations of these engines, the software remained in 

place. And if the technology was improving, what did the company 

understand about the software cheat and what does this mean for 

fixing these vehicles? Will some be easier than others? 

Of course, for EPA, we have questions about its compliance and 

recall programs. I hope we can get some clear answers today from 

that agency. Why did EPA standard compliance tests and audits 

fail to detect problems, especially in older technology? What is EPA 

doing to ensure any fix it requires of the automaker does not negatively affect vehicle performance? 

There is some need for a sense of proportion regarding this matter. The 480,000 or so VW vehicles implicated in this scandal represent only .2 percent of the cars and light trucks on the United 

States highways. And so far, we have no evidence that the software 

similar to what was used by VW is present in any other U.S. vehicles. 

The EPA’s ongoing testing will help address this question, but I 

hope our witnesses from VW and EPA can understand where confidence has been shaken. At root, the behavior to which VW admitted represents a fundamental violation of public trust, and reverberations of this violation can be seen across the United States and 

across the world, as people grapple with the implications. 

We need to develop a clear understanding of the facts and circumstances surrounding this case, and this hearing will be a first 

important step towards that goal. 

[The prepared statement of Mr. Murphy follows:] 

PREPARED STATEMENT OF HON. TIM MURPHY

Just under three weeks ago, car owners around the world were shocked to learn 

that Volkswagen AG, the world’s largest automaker, admitted that it had installed 

software for a number of years in millions of its diesel models that effectively defeated emissions controls during routine driving. 

This news followed the Environmental Protection Agency’s public announcement 

on September 18th that it had sufficient evidence to support allegations that VW 

was cheating on its emissions tests. 

As EPA reported at the time, when the cars were subject to emissions testing, the 

diesel vehicles switched into an operational mode designed specifically to pass the 

tests, and then switched back to a different mode during normal driving-a mode 

that emitted nitrogen oxides up to 10 and 40 times the Federal limits. 

4 

In the United States alone, some 482,000 Volkswagen and Audi models were affected by the cheating software. Worldwide, the software was used in an estimated 

11 million vehicles, involving several VW lines. 

In the wake of this apparently massive deception, the Energy and Commerce 

Committee opened a bi-partisan investigation to get answers for the American public. This investigation will seek to understand the facts and circumstances surrounding VW’s actions, the impact of its decisions, and related issues about emissions compliance generally. 

At this morning’s hearing we will receive testimony from the head of Volkswagen’s American operations, Mr. Michael Horn, and from EPA officials tasked with 

ensuring the automobiles on American’s roads meet Federal environmental standards. In addition, this subcommittee intends to pursue answers to critical initial 

questions concerning the troubling revelations about VW’s actions-what happened; 

who was involved; and most important, why? 

Let me acknowledge that Mr. Horn is appearing before us voluntarily today and 

say that I expect that he and the Volkswagen organization will continue to cooperate with our inquiry. This means providing documents and information to the committee as quickly as possible, including documents that have already been discussed 

publicly in connection with Volkswagen’s various board meetings in Germany. 

As I said before, there are a number of core questions we will begin to pursue 

today, both for Volkswagen and for EPA. Most critically: what happened; who was 

involved; and why were these deceptive actions taken? And we also have a number 

of questions concerning the impact of these decisions on customers, family-owned 

dealerships, and the American public. 

I hope today Mr. Horn can provide some important context for us and expand 

upon the facts he represents in his testimony. We will look to him to explain the 

current understanding of VW executives about what exactly was done to these engines, and was it done to deliberately deceive the Government regulators? And what 

is VW doing to fix the problem and make whole those who have been affected by 

its actions? 

At some point prior to 2009, VW made a choice to move forward with engines that 

evidence now suggests were not compliant with U.S. emissions standards. The illegal software was initially deployed in a first generation of these diesel engines 

which account for approximately 340,000 of the affected vehicles. However, despite 

apparent advancements in their emissions control systems in two future generations 

of these engines, the software remained in place. If the technology was improving, 

what did the company understand about the software cheat? And what does this 

mean for fixing these vehicles? Will some be easier than others? 

Of course, for EPA we have questions about its compliance and recall programs. 

I hope we can get some clear answers today from that agency. Why did EPA’s standard compliance tests and audits fail to detect problems, especially in the older technology? What is EPA doing to ensure any fix it requires of the automaker does not 

negatively affect vehicle performance? 

There is some need for a sense of proportion regarding this matter. The four hundred eighty thousand or so VW vehicles implicated in this scandal represent only 

.2% of the cars and light trucks on U.S. highways and so far we have no evidence 

that software similar to what was used by VW is present in any other U.S. vehicles. 

EPA’s ongoing testing will help address this question. But I hope our witnesses from 

VW and EPA can understand why our confidence has been shaken. 

At root, the behavior to which VW admitted represents a fundamental violation 

of public trust. And the reverberations of this violation can be seen across the 

United States and across the world as people grapple with the implications. We 

need to develop a clear understanding of the facts and circumstances surrounding 

this case. And this hearing will be a first, important step towards that goal. I now 

recognize the ranking member of the subcommittee, Ms. DeGette, for 5 minutes. 

Mr. MURPHY. I now recognize the ranking member of the subcommittee, Ms. DeGette, for 5 minutes. 

OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF COLORADO 

Ms. DEGETTE. Thank you, Mr. Chairman. 

In the spirit of bipartisanship of this investigation, I will tell you 

my first car was also a Volkswagen. It was a 1960 VW Beetle with 

5 

a ragtop sunroof that I inherited from my grandmother. And I will 

tell you that that 1960 Beetle, I still miss that car. It didn’t have 

any lines of computer code required to operate that vehicle. 

In this situation, fast forward to today, we know some things, 

but we don’t know enough. And that is why I am glad we are having this investigation. 

We know that in May 2014 West Virginia University published 

a study commissioned by the International Council on Clean Transportation that found that on-road emissions from Volkswagen cars 

were well above VW standards. They also did not match the emissions outputs found under testing conditions. 

We know that VW tried to justify this discrepancy to regulators 

with explanations of technical issues and unexpected in-use conditions. We know that in December 2014 VW initiated a voluntary 

recall of nearly half a million vehicles to resolve, among other 

things, the emissions issues. Yet, when the California Air Resources Board tested the fixed vehicles, they found that the emissions were still above the legal standards. 

And we know that, by July of this year, the EPA and CARB told 

VW that they would not approve the company’s 2016 model year 

diesel vehicles for sale unless the emissions could be explained. VW 

was essentially forced to come clean, and they ultimately confessed 

that they had installed a defeat device in their diesel cars designed 

to circumvent EPA emission standard for certain air pollutants. 

We know that this defeat device sensed when the vehicles were 

undergoing emissions testing and ensured emissions control systems were operating to pass. And we know that during normal 

road use the emissions controls were reduced and the cars were 

producing up to 40 times more nitrogen oxide than is allowed by 

emissions standards. We know that almost half a million cars in 

the United States might be affected by this. 

Now, Mr. Horn, I am glad you have come today to testify here 

because, while we know all of the things I just talked about, there 

are a lot more things we don’t know and that we need answers for. 

For example, VW hasn’t revealed how the defeat device affects the 

engine, why it was installed, and how it was able to evade emissions tests. You haven’t revealed when and how the engines 

equipped with this defeat device will be fixed. You haven’t told us 

whether this fix will affect fuel economy or performance of the vehicles. 

You haven’t revealed what Volkswagen told regulators over the 

last year, as EPA and the California Board were trying to figure 

out why the vehicles’ emissions were out of compliance. You 

haven’t revealed whether the voluntary recall that VW set in place 

in 2014 was just merely a ruse. Was the VW Group of America actually trying to find out what was wrong with the cars and fix 

them or did VW know that the cars had defeat devices on them and 

were only trying to buy time with the regulators? 

You haven’t revealed who is responsible for this scheme. We 

don’t know if it came from Germany and who knew about it in the 

United States. 

Now we have all seen the press reports, and we can all speculate 

about what happened here and why. But, until Volkswagen comes 

forward with some answers and provides some assurances that we 

6 

can trust about what they are saying, the American people, the 

regulators, and Congress are all left in the dark. So, I hope, Mr. 

Horn, that you come prepared to answer some of these questions, 

and I also hope that VW will be prepared to work with this committee as we move forward. 

Hundreds of thousands of owners invested money and trust in 

VW. Many of them bought those cars specifically because they were 

seeking environmentally friendly vehicles. Now they are left with 

cars with much higher levels of pollution. They don’t have any answers about when or how their car will be fixed or what kind of 

car they will be left with. 

Earlier this week, I visited a Volkswagen dealership in Denver. 

I saw the pollution control equipment on VW diesel vehicles firsthand. These cars account for almost 25 percent of the sales at that 

particular dealership and a significant percentage of sales at VW 

dealerships in Colorado and across this country. 

Now, because they can’t sell them, these cars are just sitting on 

the lots, which is a scene that is being repeated across the country. 

So, as, Mr. Chairman, you say, it is a small percentage of all the 

cars on the road in the U.S., it is a tremendous economic impact 

to these dealers and, also, to the consumers who don’t know what 

is going to happen to their cars. And so, that is perhaps the key 

answer that I am looking for today: what do we do moving forward? 

Now, Mr. Chairman, this subcommittee has been here before. In 

the last 15 years, we have had Ford and Firestone, Toyota, GM, 

and Takata before this committee. We were able to get information 

from all these companies to help us understand what happened. 

But, most importantly, we have used this information to chart a 

path forward and to help the consumers affected by this event. 

I hope that Volkswagen can similarly tell us today what is happening, and I hope that they will get beyond this series of terrible 

decisions and do something to restore the public trust. 

Thank you, and I yield back. 

[The prepared statement of Ms. DeGette follows:] 

PREPARED STATEMENT OF HON. DIANA DEGETTE

Mr. Chairman, thank you for calling this important hearing. 

Here is what we know so far: 

We know that in May 2014, West Virginia University published a study commissioned by the International Council on Clean Transportation that found that the onroad emissions from Volkswagen’s cars were well above EPA standards. They also 

did not match the emissions outputs found under testing conditions. 

We know that VW tried to justify this discrepancy to regulators with explanations 

of technical issues and unexpected in-use conditions. 

We know that in December 2014, VW initiated a voluntary recall of nearly 

500,000 vehicles to resolve, among other things, the emissions issues. Yet, when the 

California Air Resources Board tested the ‘‘fixed’’ vehicles, they found that the emissions were still far above the legal standards. 

We know that by July of this year, EPA and CARB told VW that they would not 

approve the company’s 2016 model year diesel vehicles for sale unless these emissions issues could be explained. 

VW was forced to come clean, and they ultimately confessed that they had installed a ‘‘defeat device’’ in their diesel cars designed to circumvent EPA emissions 

standards for certain air pollutants. 

We know that this defeat device ‘‘sensed’’ when the vehicles were undergoing 

emissions testing and ensured emissions control systems were operating to pass. We 

know that during normal road use, the emissions controls were reduced and that 

7 

the cars were producing up to 40 times more nitrogen oxide than is allowed by emissions standards. 

We know that almost half a million cars in the United States may be affected. 

VW hasn’t revealed how the defeat device affects the engine, why it was installed, 

and how it was able to evade emissions tests. 

You haven’t revealed when and how the engines equipped with this defeat device 

will be fixed. And you haven’t told us whether that fix will affect the fuel economy 

or performance of the vehicles. 

You haven’t revealed what Volkswagen told regulators over the last year as EPA 

and CARB were trying to figure out why these vehicle’s emissions were out of compliance. 

You haven’t revealed whether the voluntary recall that VW set in place in 2014 

was really a ruse. Was VW Group of America actually trying to find out what was 

wrong with the cars and fix them, or did VW know that the cars had defeat devices 

on them and were only trying to buy time with the regulators? 

You haven’t revealed who is responsible for this scheme. We don’t know who knew 

about it in Germany and who knew about it in the United States. 

We have all seen press reports and we can speculate about what happened here 

and why. But until Volkswagen comes forward with some answers—and provides 

some assurances that we can trust what they’re saying—the American people, the 

regulators, and Congress are left in the dark. So Mr. Horn, I hope you have come 

prepared to answer some of these questions today. 

Hundreds of thousands of owners invested money and trust in VW. Many bought 

them seeking environmentally friendly vehicles. 

Now they are left with cars belching much higher levels of pollution. They don’t 

have any answers about when or how their car will be fixed or what kind of car 

they will be left with. 

Earlier this week, I visited a Volkswagen dealership in Denver. I saw the pollution control equipment on VW diesel vehicles firsthand. These cars account for a significant percentage of sales at VW dealerships in Colorado. Now, scores of these cars 

are just sitting on lots—a scene repeated across the country. 

Mr. Horn, I hope you have answers for drivers and for dealers about what they 

should do with these cars moving forward. 

Mr. Chairman, this subcommittee has been here before. In the last fifteen years, 

we have hauled Ford and Firestone, Toyota, GM, and Takata before this committee. 

We were able to get information from all those companies to help us understand 

what happened in their vehicles. But more importantly, we have used this information to chart a path forward and help the consumers affected by these events. 

I hope that Volkswagen can similarly tell us today what is happening in their diesel cars and how they intend to fix it. 

Volkswagen made a series of terrible decisions and has broken the public trust. 

Today, we need some answers so we can ensure that this will never happen again. 

Mr. MURPHY. The gentlelady yields back. 

I now recognize the chairman of the full committee, the gentleman from Michigan, Mr. Upton, for 5 minutes. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. UPTON. Good morning. Thank you, Mr. Chairman. 

Fahrvergnu ̈ gen, it makes a car a Volkswagen. That ad campaign 

swept the Nation in the ’90s. VW has long enjoyed an almost cultish following, dating back to the Beetle, VW Van, and the Rabbit. 

But, through the years, something apparently became rotten in 

Wolfsburg, and cheating and betrayal became part of that game 

plan. 

There is a lot that we don’t know about VW’s actions or their motivations in attempting to skirt emission standards. But, regardless 

of intent, they have betrayed the trust of regulators, dealers and 

suppliers, and, most important, the driving public. 

Probably the most famous congressional hearing question is, 

‘‘What did you know and when did you know it?’’, asked by Senator 

Howard Baker back in the seventies at Watergate. Now we learn 

8 

that you knew some 18 months ago. So, we add, what did you really do to fix it and come clean versus simply going along? 

Ultimately, this saying rings true: cheaters never prosper. And 

that is why we are here today. We have many questions about how 

we got here and the road ahead. Why would one of the world’s largest automakers go to such lengths to avoid emissions requirements? Who was responsible for these decisions and why did they 

for years, even as the technology improved, continue that path? 

If they were willing to cut corners here, what else have they 

done? How will you fix the flaw and when? Will the fix affect the 

performance of these vehicles? Unraveling these questions will take 

time, and I don’t expect that we are going to discover all the answers today. But if VW is serious about rebuilding this broken 

trust, its leaders will need to demonstrate a serious commitment 

to answer these and many other questions prompted by its actions. 

This requires transparency, cooperation, and clear, consistent 

communication not only with this committee, the EPA, and other 

ongoing investigations, but also with its customers, suppliers, dealers, and the general public. VW will inevitably pay a steep price 

for this dirty little secret. How it responds to the failure will go a 

long way to rebuilding or further eroding the public’s trust. 

VW must also consider what implications these actions have for 

the thousands of Americans that it employs, including their facility 

in Auburn Hills, Michigan. Every single one of us who has ties to 

Michigan is proud of our rich tradition that is so closely intertwined with the success of the automobile. In fact, Michigan is one 

of several States that have launched their own investigations. All 

automakers must advance by imagination and innovation, not by 

gaming the system and breaking the law. 

We will get some additional insight today, but the committee’s 

investigation is just beginning. This hearing is an important step. 

As we receive documents and information, new details are certain 

to emerge. I look forward to getting to the bottom of this issue as 

quickly as possible. 

I take this very personally. As the author of the TREAD Act to 

protect the public, Congress was very clear in our work to protect 

consumers from abuses from automakers, which included steep 

fines and, yes, criminal prosecution. 

VW has betrayed a nation, a nation of regulators, loyalists, suppliers, and innocent customers. It is time to clean it up or get off 

the road. 

[The prepared statement of Mr. Upton follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

Fahrvergnu ̈ gen—it’s what makes a car a Volkswagen. That ad campaign swept 

the Nation in the 1990s. Volkswagen has long enjoyed an almost cultish following 

dating back to the Beetle, VW van, the Rabbit. But through the years something 

apparently became rotten in Wolfsburg, and cheating and betrayal became part of 

the VW game plan. 

There is a lot we still do not know about Volkswagen’s actions, or their motivations, in attempting to skirt emissions standards. But regardless of intent, they 

have betrayed the trust of regulators, dealers and, most importantly, the driving 

public. 

The most famous congressional hearing question is: ‘‘what did you know and when 

did you know it?’’ asked by Senator Howard Baker. Now we learn you knew some 

18 months ago. So we add: What did you really do to fix it and come clean versus 

9 

simply going along? But, ultimately, the saying rings true: cheaters never prosper. 

That’s why we are here today. 

We have many questions about how we got here, and the road ahead. Why would 

one of the world’s largest automakers go to such lengths to avoid emissions requirements? Who was responsible for these decisions and why did they for years, even 

as the technology improved? If they were willing to cut corners here, what else have 

they done? How will you fix this flaw and when? Will the fix affect the performance 

of these vehicles? 

Unraveling these questions will take time and I do not expect we will discover 

all the answers today. But if VW is serious about rebuilding this broken trust, its 

leaders will need to demonstrate a serious commitment to answer these and many 

other questions prompted by its actions. This requires transparency, cooperation 

and clear, consistent communication—not only with this committee, the EPA, and 

other ongoing investigations, but also with its customers, suppliers, dealers, and the 

general public. 

VW will inevitably pay a steep price for its dirty little secret. How it responds 

to this failure will go a long way to rebuilding, or further eroding, the public’s trust. 

VW must also consider what implications these actions have for the thousands of 

Americans it employ, including at their facility in Auburn Hills, Michigan. Every 

single one of us who has ties to Michigan is proud of our rich tradition that is so 

closely intertwined with the success of the automobile. In fact, Michigan is one of 

several States that have launched their own investigations. Recent reports are sickening, and cannot be tolerated. All automakers must advance by imagination and 

innovation—not by gaming the system and breaking the law. 

We will get some additional insight today but the committee’s investigation is just 

beginning. This hearing is an important step. As we receive documents and information, new details are certain to emerge. I look forward to getting to the bottom of 

these issues as quickly as possible. I take this very personally. As the author of the 

TREAD Act to protect the public, Congress was clear in our work to protect consumers from abuses from automakers. 

Volkwagen has betrayed a nation—a nation of regulators, loyalists, and innocent 

customers. Either clean it up, or get off the road. 

Mr. UPTON. I yield the balance of my time to Marsha Blackburn, 

the vice chairman. 

Mrs. BLACKBURN. Thank you, Mr. Chairman. 

Mr. Horn, thank you for being here, and I think it is completely 

appropriate that you come before the committee, that you apologize 

for the actions, and that you and VW take full responsibility for 

what has transpired. It is disappointing. 

I am fully aware that our Governor has been at the Chattanooga 

facility. And I know that the Governor, State legislators, the other 

members of the congressional delegation, and I are quite concerned 

about this. You have got a lot of hard-working, honest Tennesseans 

who were at that Chattanooga facility, and we are quite concerned 

about the actions of a few, a few VW employees, not Chattanoogans 

and not Tennesseans. 

We are going to be very precise with you and VW. It is, as the 

chairman said and as Chairman Murphy has said, it is basically 

the who, what, when, where, how, and why. Why you did it, how 

you did it, when you did it, when you knew, who carried this out. 

Where did this take place? Did it go across the brands? Was it 

pointed at EU regulations? Was it pointed at some of the climate 

regulations? Is the EPA to overburdened to have noticed this? 

This is a systemic failure. And I will also point out some want 

to say it is a safety issue. No, sir, this is an issue of integrity. 

So, we appreciate that you are here. We look forward to hearing 

from you. 

And I want to yield the balance of my time to the vice chair of 

the subcommittee, Mr. McKinley. 

Mr. MCKINLEY. Thank you. 

10 

And thank you, Mr. Chairman, for ordering this meeting. Others 

of you have talked about the car. My first was a 1957 Volkswagen. 

I think I have got everybody beat on that. 

But, listen, there should be zero tolerance for this unethical behavior and flagrant disregard of the U.S. laws, public health, and 

the consumer. That is why this hearing is important to us today. 

The impaired people need to understand what happened, how it 

happened, and how it will be resolved. 

And they feel in West Virginia that they have been deceived. So, 

on Monday there was action taken by the attorney general to file 

action against this. 

I also just want to touch on the University. At West Virginia 

University they use a fraction of the money that we spend with 

EPA, just a fraction of the money, to make this discovery. And they 

found out, as you know, that one of the cars that they tested was 

15 to 35 times more emissions than they were allowed. Another 

was 5 to 20 times more emissions. 

So, Mr. Chairman, I want to touch on the fact that this opportunity about WVU and what its research, how research dollars can 

work. And this is what happened—not the EPA, but this was a university that was able to accomplish this. 

So, I am looking forward to this hearing and getting some clarity 

as to what this is. I thank you very much for holding this session—— 

Mr. MURPHY. Thank you. 

Mr. MCKINLEY [continuing]. And look forward to the conversation. 

Mr. MURPHY. Thank you. 

We now recognize the ranking member of the committee, Mr. 

Pallone, for 5 minutes. 

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY 

Mr. PALLONE. Mr. Chairman, thank you for holding this hearing. 

We are here today because Volkswagen lied. They lied to regulators, they lied to their customers, and they lied to the American 

people. 

We all have many important questions that deserve answers. 

What did Volkswagen do to its cars? Why did they do it? And who 

knew this was happening, both in Germany and here in the United 

States? 

This whole scheme makes me question how much we should 

trust Volkswagen. To be honest, this committee’s investigations 

over the last 5 years make me question how much we should trust 

the auto industry in general. 

Let me remind the committee of the difficult history the American driver has had with the auto industry in recent years. 

In 2010, this committee investigated Toyota’s recall of 9 million 

vehicles worldwide for unexplained cases of sudden unintended acceleration. Dozens of people died in accidents linked to runaway 

Toyota vehicles. Our committee held multiple hearings and, in the 

end, it was determined that Toyota knew about certain problems 

11 

with their vehicles that, if fixed early, would likely have saved 

lives. 

In early 2014, we launched an investigation of General Motors’ 

ignition switches that killed many people. Our committee’s investigation found that individuals within GM knew about the deadly 

ignition defect for nearly a decade before the company initiated a 

recall. 

Later in 2014, we learned of the exploding Takata airbags installed in vehicles made by at least 11 auto manufacturers. The recalls for airbag problems began as early as 2008. Yet, Takata and 

NHTSA continued to investigate whether additional recalls are still 

necessary, and Takata still has not determined the root cause of 

the defect, which has killed a number of people worldwide and injured hundreds more. 

And now, we have Volkswagen, a company that told regulators 

that their vehicles met emission standards, but had actually installed defeat devices to bypass emission controls. 

Over the past 5 years, the world’s three largest automakers have 

come before this committee to admit that they have cheated the 

system and lied to American customers. This seems to be a pervasive culture of deception in the auto industry, and it has to stop 

now. 

Mr. Chairman, the American people need to know that they are 

safe on our roads, and they need to know that when they decide 

to buy a car, they are actually getting what they paid for. The auto 

industry has deliberately chosen to perpetuate lies and mislead 

consumers, but the American public are not crash-test dummies 

and cannot be treated as such. 

Mr. Horn, I understand that you won’t have all the answers here 

today, but please don’t hide behind an internal investigations excuse. It is time for Volkswagen to be forthcoming with its customers, regulators, and Congress about what you did to these cars 

and why. We deserve an explanation. 

[The prepared statement of Mr. Pallone follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Mr. Chairman, thank you for holding this hearing. We are here today because 

Volkswagen lied. They lied to regulators. They lied to their customers. And they lied 

to the American public. 

We all have many important questions that deserve answers. What did Volkswagen do to its cars? Why did they do it? And who knew this was happening, both 

in Germany and here in the U.S.? 

This whole scheme makes me question how much we should trust Volkswagen. 

And to be honest, this committee’s investigations over the last 5 years make me 

question how much we should trust the auto industry. 

Let me remind the committee of the difficult history the American driver has had 

with the auto industry in recent years. 

In 2010, this committee investigated Toyota’s recall of nine million vehicles worldwide for unexplained cases of sudden unintended acceleration. Dozens of people died 

in accidents linked to runaway Toyota vehicles. Our committee held multiple hearings and in the end, it was determined that Toyota knew about certain problems 

with their vehicles that if fixed early would likely have saved lives. 

In early 2014, we launched an investigation of General Motors’ ignition switches 

that killed many people. Our committee’s investigation found that individuals within GM knew about the deadly ignition defect for nearly a decade before the company 

initiated a recall. 

Later in 2014, we learned of the exploding Takata airbags installed in vehicles 

made by at least 11 auto manufacturers. The recalls for airbag problems began as 

12 

early as 2008, yet Takata and NHTSA continue to investigate whether additional 

recalls are still necessary. Takata still has not determined the root cause of the defect, which has killed a number of people worldwide and injured hundreds more. 

And now, we have Volkswagen. A company that told regulators that their vehicles 

met emission standards, but had actually installed defeat devices to bypass emission 

controls. 

Over the past 5 years, the world’s three largest automakers have come before this 

committee to admit that they have cheated the system and lied to American consumers. There seems to be a pervasive culture of deception in this industry and it 

is has to stop now. 

Mr. Chairman, the American people need to know that they are safe on our roads. 

And they need to know that, when they decide to buy a car, they are actually getting what they paid for. The auto industry has deliberately chosen to perpetuate lies 

and mislead consumers. But the American public are not crash test dummies and 

cannot be treated as such. 

Mr. Horn, I understand that you won’t have all the answers here today. But 

please don’t hide behind an internal investigations excuse. It is time for Volkswagen 

to be forthcoming with its customers, regulators, and Congress about what you did 

to these cars and why. We deserve an explanation. 

I yield my remaining time to Rep. Schakowsky. 

Mr. PALLONE. And I would like to yield, Mr. Chairman, my remaining time to Ms. Schakowsky. 

Ms. SCHAKOWSKY. Thank you for yielding, Mr. Ranking Member. 

We will hear a lot from Volkswagen today. We will hear apologies, I’m sure, for Volkswagen’s deliberate deception of the American people and Federal and State public health agencies. We will 

hear a pledge to get to the bottom of this issue without delay and 

to fully cooperate with investigators. We will hear how the use of 

so-called defeat devices is incompatible with Volkswagen’s corporate culture. And I want to tell you, Mr. Horn, I don’t buy it. 

The American people, the EPA, and their counterparts around 

the world have been defrauded by Volkswagen. The company’s 

word isn’t worth a dime. 

The only thing I want to hear today is exactly how will Volkswagen make this right by consumers. Saying it will take time to 

design and implement a fix is insufficient and I think unacceptable. 

People shouldn’t have to wait to get the fuel economy, the low 

emissions, and performance that they already paid for. If they 

wanted, every Volkswagen clean diesel vehicle owner should be 

able to get their money back, all of it. 

The American people deserve answers. Yes, there are a lot of 

questions, but there are also thousands of owners of clean diesel 

Volkswagens out there, and what they are wanting to know is what 

are you going to do for them and when. And I say now. So, I expect 

those answers to be provided today. 

And I yield back to the ranking member of the full committee. 

Mr. PALLONE. Thank you, Mr. Chairman. 

Unless anyone else on this side would like the time, I am going 

to yield back. I yield back, Mr. Chairman. 

Mr. MURPHY. Thank you. The gentleman yields back. 

I also ask unanimous consent that the written opening statements by other members of the committee be introduced into the 

record, and without objection, the documents will be entered into 

the record. 

You are aware that the committee is holding an investigative 

hearing, and when doing so, has the practice of taking testimony 

13 

under oath, Mr. Horn. Do you have any objections to testifying 

under oath? 

Mr. HORN. No. 

Mr. MURPHY. Thank you. 

The Chair then advises you that, under the rules of the House 

and the rules of the committee, you are entitled to be advised by 

counsel. Do you desire to be advised by counsel during your testimony today? 

Mr. HORN. No. 

Mr. MURPHY. Then, in that case, will you please raise your right 

hand and I will swear you in? Stand and raise your hand. 

[Witness sworn.] 

Mr. MURPHY. Thank you. 

Let the record show the witness answered yes. You are now 

under oath and subject to the penalties set forth in Title 18, Section 1011 of the United States Code. 

You may now give a 5-minute summary of your written statement. If you will please make sure your microphone is on and pull 

it close to you, so we can hear you? You have to press the button. 

Is it on? 

STATEMENT OF MICHAEL HORN, PRESIDENT AND CHIEF 

EXECUTIVE OFFICER, VOLKSWAGEN GROUP OF AMERICA 

Mr. HORN. Thank you very much, Chairman Upton, Chairman 

Murphy, Ranking Member Pallone, Ranking Member DeGette, 

other members of the committee. Thank you for inviting me here 

today to testify before the committee. 

My name is Michael Horn, and I am president and CEO of 

Volkswagen Group of America, a subsidiary of Volkswagen AG, 

headquartered in Germany, in Wolfsburg. 

I volunteered to come here before this committee at the very outset of these inquiries in an effort to show our commitment to cooperation. We have not had the opportunity to review all aspects 

of this matter. Indeed, the investigation is just beginning. Therefore, my testimony and my answers to your questions will, by necessity, have to be considered preliminary and based on my best 

current recollection and information. 

On behalf of our company and my colleagues in Germany and me 

personally, I would like to offer a sincere apology, sincere apology 

for Volkswagen’s use of a software program that served to defeat 

the regular emissions testing regime. 

In the spring of 2014, when the West Virginia University study 

was published, I was told that there was a possible emissions noncompliance that could be remedied. I was informed that EPA regulations included various penalties for noncompliance with the emissions standards and, also, that the agency could conduct engineering tests on their own which could include analysis on defeat devices or other auxiliary equipment. 

Let me be very clear about this: While I was told about the EPA 

process, I was not then told, nor did I have any reason to suspect 

or to believe, that our vehicles included such a device. 

I was also informed that the company engineers would work with 

the agencies to resolve the issue. Later in 2014, I was informed 

that the technical teams had a specific plan for remedies to bring 

14 

the vehicle into compliance and that they were engaged with the 

agencies about the process. And you mentioned this, also, in your 

statements. 

On September 3rd, 2015, Volkswagen AG disclosed at a meeting 

with the California Air Resources Board and the U.S. Environmental Protection Agency that emission software in four-cylinder 

diesel vehicles for model years 2009 until 2015 contained a defeat 

device in the form of hidden software that could recognize whether 

a vehicle was being operated in a test laboratory or on the road. 

The software made those vehicles emit high levels of nitrogen oxides when the vehicles were driven in actual road use rather than 

laboratory testing. 

In Volkswagen’s recent, ongoing discussions with the regulators, 

we described to the EPA and CARB that our emissions control 

strategy also included a software feature that should be disclosed 

to and approved by them as an Auxiliary Emissions Control Device, 

which is also called AECD, in connection with the certification 

process. As a result, in order to show that we acted immediately, 

we have withdrawn the application for certification for all model 

year 2016 vehicles and we are now working with the agencies to 

continue the certification process. 

These events—and I fully agree on this—are deeply troubling. I 

did not think that something like this was possible at the Volkswagen Group. We have broken the trust of our customers, dealerships, employees, as well as the public and the regulators. And let 

me be very clear. We at Volkswagen take full responsibility for our 

actions and we are working with all the relevant authorities in a 

cooperative way. 

I am here to offer the commitment of Volkswagen AG to work 

with this committee to understand what happened and how we will 

move forward. EPA, CARB, the U.S. Department of Justice, State 

attorneys general, as well as other authorities are fulfilling their 

duties to investigate this matter, and we are determined to make 

things right. 

This includes accepting the consequences of our acts, providing 

a remedy, and beginning to restore the trust of our customers, 

dealerships, employees, the regulators, and the American public. 

We will rebuild the reputation of a company that more than 2 million people worldwide, including dealers and suppliers, rely upon 

for their livelihoods. 

Our immediate goal is to develop a remedy for our customers. 

While much work is still to be done, I would like to talk today 

about how we get from where we are now to that goal. 

First, we are conducting investigations on a worldwide scale on 

how these matters could have happened. Responsible parties will 

be identified and held accountable. Thorough investigations have 

already begun, but any information development at this stage is 

preliminary. We ask for your understanding as we complete this 

work. 

Second, it is important for the public to know that, as the EPA 

has said, these vehicles do not present a safety hazard and remain 

safe and legal to drive. 

Third, technical teams are working tirelessly to develop remedies 

for each of the affected group of vehicles. These solutions will be 

15 

tested and validated and, then, shared with the responsible authorities for approval. 

There are three groups of vehicles involved, each containing one 

of the three generations of the two-liter diesel engine. Each will require a different remedy, but these remedies can only be our first 

step to our customers. 

Fourth, we will examine our compliance processes and standards 

at Volkswagen and adopt measures to make certain that something 

like this cannot happen again. 

Fifth, we commit to regular and open communication with our 

customers, dealers, employees, and the public as we move forward. 

And as first steps, we have set up a designated service line, Web 

site, micro-site, to be a channel for this communication. And I have 

sent a personal letter to every affected customer. 

I can offer today this outline of a path forward towards the goal 

of making things right. Nevertheless, Volkswagen knows that we 

will be judged not by our words, but clearly by our actions over the 

coming weeks and months. 

These events are fundamentally contrary to Volkswagen’s core 

principles of providing value to our customers, innovation, and responsibility to our communities and our environment. They do not 

reflect the company that I know and to which I have dedicated 25 

years of my life. It is inconsistent that this company involved in 

this emissions issue is also a company that has invested in environmental efforts to reduce the carbon footprint in our factories 

around the world, where our plant in Tennessee is the best factory 

in this respect. 

In closing, again, I apologize on behalf of everyone at Volkswagen. We will fully cooperate with the responsible authorities. We 

will find remedies for our customers and we will work to ensure 

that this will never happen again. 

Thank you again for allowing me to testify today, and I look forward to your questions. Thank you. 

[The prepared statement of Mr. Horn follows:] 

16 

17 

18 

19 

Mr. MURPHY. Thank you, Mr. Horn. 

I now recognize myself for 5 minutes of questioning. 

On September 3rd, 2015, VW admitted to CARB and EPA that 

it had installed defeat devices in certain model year 2009 and 

model year 2015 vehicles. To the best of your knowledge, did VW 

install this software for the express purpose of defeating emissions 

controls? 

Mr. HORN. To our understanding—and this is also part of the investigation—it was installed to this purpose, yes, for this purpose. 

Mr. MURPHY. Now in your written testimony you noted that you 

were made aware of potential emissions compliances in the spring 

of 2014. 

Mr. HORN. Uh-hum. 

Mr. MURPHY. You also noted discussions at the time about penalties for noncompliance and the EPA’s ability to test for defeat devices. At that time were you aware or informed that these vehicles 

contained defeat devices? 

Mr. HORN. No. 

Mr. MURPHY. When did you first learn, then, that VW vehicles 

contained a defeat device? 

Mr. HORN. Around the September 3rd meeting, a couple of days 

before. 

Mr. MURPHY. And then, why were you having discussions about 

defeat devices in the spring of 2014, then, if there was no knowledge or at least a concern that these vehicles contained a defeat device? 

Mr. HORN. So, the University of West Virginia made the study. 

There was a Jetta and Passat in there and another off-road vehicle. 

I don’t want to name the brand now. And the results were communicated. In this context, I was told by our experts in the Auburn 

Hills office—and it was also, you know, just four months into this 

market—that, of course, you know, not complying with emission 

standards is relating to fines, and hefty fines, specifically here in 

the U.S., and that those experts, including the German Technology 

Department, will check on the study and the study results. 

As you also mentioned, it was a small team. Results have been 

published with all the emissions, which went overboard, and that 

they will check this, point 1. 

Point 2 is they would also look with all the responsible departments, and there was a number of experts at the Department in 

Germany, and then, how to possibly fix this. And then, there was 

the notion in this communication that, also, the EPA or the agencies could check also on their own, which to my degree is normally 

around the world that agencies check once in a while on their own, 

for auxiliary devices, including defeat devices. 

At that point of time, I had no understanding what a defeat device was and I had no indication whatsoever that a defeat device 

could have been in our cars. 

Mr. MURPHY. So, let me go back. Mr. Horn, the new Chief Executive, Volkswagen, Mr. Mueller, has been quoted in media reports 

this morning saying that only a few people were involved with the 

deception. Now I have to say that I don’t take much comfort in 

that, especially knowing that Volkswagen has been known for superb engineers and mechanics, who I wonder shouldn’t they have 

20 

picked up on this. But isn’t it true that the technology was installed in the automobiles at least initially because the cars could 

not meet the new, more stringent emissions standards for diesel 

engines? 

Mr. HORN. Yes, to your last question, this appears to be this way, 

and to newspaper articles about possible quotes of Mr. Mueller, I 

don’t want to quote this. 

As I said, also, the investigations are preliminary. One week our 

group revision did the investigation from September 22nd to October 1st. And then, the entire investigations on this matter is 

turned over to an external agency, a law firm called Jones Day, an 

American company, which is now going through the systems, outside advice, outside counsel. 

Mr. MURPHY. I think what we find amazing is that West Virginia 

University discovered this, and your army of brilliant engineers 

and talented mechanics didn’t know something was amiss. And I 

am sure we will have more questions about that. 

But I want to ask you this: in terms of VW’s status for remedying these defeat devices, who is responsible for developing and 

testing the solution? 

Mr. HORN. The responsibility for developing and testing the engine and drivetrain software lies within the Engine and Drivetrain 

Division in Germany, in Wolfsburg, for the two-cylinder, for the 

four-cylinder TDI engines. 

Mr. MURPHY. Now will this require a software patch or changes 

to the actual vehicle’s architecture and hardware? 

Mr. HORN. Yes, thank you for this question. I think we have to 

do a different change now into the three groups of cars. You’ve 

mentioned that roughly 500,000 cars are affected. Out of those, 

round about 430,000 cars are the Gen 1 vehicles, which were the 

very early vehicles, started here in 2009. For those cars, we believe 

that a software-only solution will not be possible because, also, to 

be quite frank and logic, you know, if it would have been possible, 

they would have done it in the first place. 

So, for those cars, we are working on both software and hardware solutions, and there are different strategies about an additional NOx catalytic converter as well as an SCR Urea Tank. But 

this is something which is hardware engineering, which is a little 

bit—it’s complex and it takes time to develop and to test this. This 

is one of the strategies. 

The Generation 2 vehicles, which is just the Passat model, I feel 

there are 90,000 cars here in the U.S. This will be most probably 

a software solution. This is tested now, and could involve one or 

the other, let’s say, sensor. But whatever I explain to you now, anyway, this is being discussed in a timely manner now in the next 

couple of weeks with the California Air Resources Board and the 

CARB. 

For the Generation 3 vehicles, so the actual—— 

Mr. MURPHY. Can I ask, because I have gone way over time—— 

Mr. HORN. Sure, sure. 

Mr. MURPHY. I am sure other colleagues are going to be asking 

some more detailed questions that we will get today. 

Mr. HORN. OK. 

21 

Mr. MURPHY. But I now need to yield 5 minutes. I recognize Ms. 

DeGette for 5 minutes. 

Ms. DEGETTE. Thank you, Mr. Chairman. 

Now, Mr. Horn, your company acknowledged that it installed 

these defeat devices on a number of models dating back to 2009, 

correct? 

Mr. HORN. Sorry, I have a problem understanding with all this 

noise stuff. 

Ms. DEGETTE. Oh, Mr. Chairman, Mr. Chairman, can you please 

have quiet in the room, so Mr. Horn can understand me? 

Mr. MURPHY. Yes. Thank you. 

The room will please be quiet, especially upfront. Thank you. So, 

you are not distracted. Thank you. 

Ms. DEGETTE. All right. I will ask that again. And if I can have 

the clock reset to 5 minutes? 

Mr. Horn, your company has acknowledged that it installed these 

defeat devices on a number of models back to 2009, yes or no? 

Mr. HORN. Yes. 

Ms. DEGETTE. And do you know how the various defeat devices 

installed in the cars actually work at this point? 

Mr. HORN. Personally, no, I’m not an engineer. 

Ms. DEGETTE. Does someone at VW know how these defeat devices work? 

Mr. HORN. I believe this is also within the investigations, and I 

believe that—— 

Ms. DEGETTE. Can you please give us the information when you 

find out? 

Mr. HORN. We will. We will if we have it. 

Ms. DEGETTE. Thank you very much. 

Now you mentioned this West Virginia University study that was 

conducted in May of 2014 which found that there real NOx submissions on several Volkswagen vehicles exceeded EPA standards by 

as much as 35 times. Following publication of that study, VW represented to the California Air Resources Board, or CARB, and to 

the EPA that the increased emissions were due to technical issues 

and unexpected in-use conditions. Correct? 

Mr. HORN. I’m sorry, you guys cough here all the time, and I 

have trouble—— 

Ms. DEGETTE. All right. I will ask the question again. 

Mr. HORN. Thank you. 

Ms. DEGETTE. After that study by West Virginia University, isn’t 

it true that VW told the EPA and the California Board that the increased emissions were due to technical issues and unexpected—— 

Mr. HORN. Yes. 

Ms. DEGETTE [continuing]. In-use conditions? 

Mr. HORN. Yes. 

Ms. DEGETTE. Yes. 

Mr. HORN. True. 

Ms. DEGETTE. And those representations at that time were, in 

fact, incorrect and false, weren’t they, sir? 

Mr. HORN. Yes. 

Ms. DEGETTE. Yes, they were. 

Now, to your knowledge, did anybody at the Volkswagen Group 

of America know at that time that, in fact, those discrepancies 

22 

were due to these defeat devices when they made those representations to the regulators? 

Mr. HORN. To my knowledge at this point of time, no. 

Ms. DEGETTE. No one in the U.S. did? 

Mr. HORN. No. 

Ms. DEGETTE. OK. Now, in December 2014, VW proposed a recall of 500,000 vehicles to resolve the, quote, ‘‘technical issues’’. Is 

that correct? 

Mr. HORN. Uh-hum. 

Ms. DEGETTE. And, in fact, a number of those vehicles were recalled. Is that correct? 

Mr. HORN. Yes, most of them. 

Ms. DEGETTE. But, after they were recalled, the California regulator still said that that fix did not work, isn’t that correct? 

Mr. HORN. That is correct. 

Ms. DEGETTE. Now, to your knowledge, did anyone at the Volkswagen Group of America know about the existence of these defeat 

devices when the company announced that recall in December of 

2014? 

Mr. HORN. To my best knowledge today, no. 

Ms. DEGETTE. Mr. Horn, when did you personally learn of the 

defeat device and under what circumstances? 

Mr. HORN. Around the meeting on September 3rd with CARB 

and EPA. 

Ms. DEGETTE. OK. Now you talked, when the chairman asked 

you about these cars—I am concerned about what we are going to 

do about the 500,000 cars we have on the road in the U.S. And the 

first thing is, as you just testified, about 430,000 of those cars cannot be fixed by a software-only solution. Is that correct? 

Mr. HORN. Yes. 

Ms. DEGETTE. And that is because of the way that the engine is 

designed in these vehicles. Correct? 

Mr. HORN. I would say not the engine is designed, but all the 

after-treatment systems. 

Ms. DEGETTE. Right. And I have got to say, I have got to acknowledge my wonderful dealer Fred Emich, who is here today. 

And he let me come and talk to his wonderful mechanics on Monday. They gave me this chart right here. I tried to take the card 

itself, but it was too heavy and they told me I would have to probably pay them $2,000 if I lost it. So, I decided to take the chart 

instead. 

This is the chart of the exhaust on these 430,000 cars. And as 

I could clearly see, you can’t do a minor little fix to fix this problem. So, what is VW going to do for these 430,000 cars, so that the 

users can use them and so that they can pass the emissions test? 

Mr. HORN. So, from this distance, I can’t see the chart, but I believe it is maybe something out of our service literature or customer literature. 

Ms. DEGETTE. It is the exhaust system for these cars. 

Mr. HORN. Yes, but—— 

Ms. DEGETTE. What can be done to fix that? 

Mr. HORN. There’s two scenarios next to the software adjustments and one scenario—— 

23 

Ms. DEGETTE. But these are for the cars that can’t have, that the 

software adjustments will not work. 

Mr. HORN. We are talking now about Generation 1 cars, the 

430,000 cars. 

Ms. DEGETTE. That’s right. 

Mr. HORN. The picture you have shown and the treatment, software alone doesn’t work because, otherwise, they would have done 

it right in the first place. 

Ms. DEGETTE. Right. So, what are you going to do for those cars? 

Mr. HORN. Two technical scenarios. Either a Urea Tank, SCR 

Tank, to put, add glue in there, or a specific catalyzer for the NOx. 

Two technical scenarios. 

Ms. DEGETTE. OK, but those cars don’t have the Urea Tank right 

now? 

Mr. HORN. No. That’s why it has to—— 

Ms. DEGETTE. So, this would be a major fix, correct? 

Mr. HORN. Yes, ma’am. 

Ms. DEGETTE. Now what is the timeframe VW has set for that 

fix? 

Mr. HORN. We are still working on the timeframe, and it’s too 

early to say when this fix exactly is going to take place. 

Ms. DEGETTE. When are these dealers going to be allowed to sell 

these cars? 

Mr. HORN. The dealers, the issue with the dealers, as Fred 

Emich told you, is that we have not the model year ’16 certified 

and we have stopped sale on our own, on our own—— 

Ms. DEGETTE. Right. When is that going to be fixed? 

Mr. HORN. The model year ’15—— 

Ms. DEGETTE. So you are going to be able to sell those cars? 

Mr. HORN. There are two scenarios. A scenario, we are now trying to get a conditional approval with the EPA until we have the 

final software fix beginning of next year. 

Ms. DEGETTE. The beginning of next year? And in the meantime, 

what are the dealers and the customers supposed to do, the ones 

who have these cars? 

Mr. HORN. Well, in the meantime, no customer can buy a car because it’s not available for them. And with the dealers, we have 

very early started a program to work with them to also help them 

financially and to communicate with them—— 

Ms. DEGETTE. OK, but the 430,000 cars that are already on the 

road, what are those customers supposed to do? Their cars cannot 

pass the emissions test. 

Mr. HORN. The EPA has said, and they have repeated this also 

in their statement, that these cars are legal and safe to drive. 

Mr. MURPHY. Thank you. 

Mr. HORN. Until now, there’s no indication that they didn’t pass 

any emissions test. 

Mr. MURPHY. Thank you. The gentlelady’s time has expired. 

Now we need to recognize the chairman of the full committee, 

Mr. Upton of Michigan, for 5 minutes. 

Mr. UPTON. Thank you, Mr. Chairman. 

I want to go back to the specifics of the defeat device. So, I live 

in Michigan. Where I live we don’t need to test our cars for emisVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
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sions on an annual basis, as many States require. Certainly, in this 

region here in DC I know they do. 

So, how is this defeat device actually set up, so that it was different when an individual drove it down the road versus taking it 

to a service station and getting the emissions sticker that is often 

required in the States that require such? 

Mr. HORN. So, I’m—— 

Mr. UPTON. I’ve been told a couple of things, but I just want to 

know if you can walk—— 

Mr. HORN. I can’t tell you—— 

Mr. UPTON [continuing]. Me through how that could change the 

emissions system. What happens? 

Mr. HORN. I can share my best knowledge, but I’m not an engineer, neither a software engineer. 

Mr. UPTON. Well, I—— 

Mr. HORN. But let me try to explain. Let me try to explain. My 

understanding at this point of time is that the software was designed that the vehicle or the software could detect whether it was 

on a dyno, in a testing laboratory environment, or whether it was 

on the street. 

And one example of this, as experts have explained to me, is that 

the software could detect whether the steering wheel made an 

angle. So, there might have been and there will be other parameters, like maybe speed and, then, change of speed and those 

things. 

Mr. UPTON. Maybe the weight of the driver in the driver’s seat? 

Mr. HORN. I don’t think so, but maybe. I don’t know. 

Mr. UPTON. So, wouldn’t it be easy to develop the software that 

would just remove that? 

Mr. HORN. Yes. This will be, this software will be ready—— 

Mr. UPTON. But, of course, when that happens, the car isn’t 

going to meet the emissions test. 

Mr. HORN. Regarding the model year ’16 and ’15, which were the 

Generation 3 cars, which we are discussing right now with the 

agencies, the defeat device will be either switched off, and from 

January onwards will be completely taken out of the car. And those 

cars will pass the emissions test. 

Mr. UPTON. So, how many vehicles will not pass the emissions 

test, or the ones that you have identified? 

Mr. HORN. Now, I mean, my question—— 

Mr. UPTON. So, you will be able to do that with the later 

versions, right? 

Mr. HORN. We have—— 

Mr. UPTON. But not the earlier versions of the vehicle? They 

won’t be able to pass? By turning off the device, the defeat device, 

there will be a number of cars that, in fact, will not meet the current standards. And that is your big goal. 

Mr. HORN. The burn standards, yes, you’re right. 

Mr. UPTON. And how many of those vehicles are there on the 

road? 

Mr. HORN. Well, we have a total of 500,000: 430,000 Generation 

1 vehicles, 95,000 Generation 2 vehicles, and then, it’s around 

70,000 Generation 1 vehicles. And so, you know, all of these cars 

are out of the legal compliance, clearly. But, as EPA has said, all 

25 

these cars are legal and safe to drive for the owners. So, we are 

not selling the cars, but the owners can legally drive and safely 

drive their cars. 

Mr. UPTON. So, your dealers across the country, they have their 

finance plans, where they have quite an inventory, I would guess, 

of cars that they are now unable to sell. They have paid in advance 

for those under the financing plan that dealers have, and they are 

not going to be able to sell them for a number of months, perhaps 

even as long as six months at a minimum, until the fixes can be 

done. 

What type of remedies are you offering the dealers in terms of 

financial incentives, knowing that they have paid for these cars 

and, frankly, lost a boatload, I would imagine? 

Mr. HORN. Yes, and this is also—— 

Mr. UPTON. That inventory has got to be a pretty big loss. 

Mr. HORN. This is also one of the things which troubles me personally very much because the last one, yes, we’ve worked very 

hard and we’ve brought profitability up and all of those things. 

But I’ll tell you exactly. On Friday, the 18th, the Notice of Violation was communicated. We had a call with the National Dealer 

Counsel. Some of the folks are sitting behind me. On Monday, we 

issued our first financial relief aid. So, we put all the TDIs, used 

cars, CPO cars, and new cars on free flooring. We took all the 

bonus thresholds out for car sales. So, we paid maximum bonus for 

each car sold, and we took also out the customer satisfaction targets objectives and we paid maximum customer satisfaction bonus 

on those cars. And this is more than $1,000, $1,500 per car. 

Coming towards October now, we provided every dealer around 

the U.S. with a discretionary fund, with a discretionary fund which 

was explained to them through the District Managers, the Sales 

Operations Managers, and which was wired to the dealers on October 1st. 

I don’t want to call out the number, but it is a significant amount 

of money in order for them to have flexibility. So, no accountability 

towards us; flexibility to solve the most urgent customer cases or 

to invest or to put the money where they think it would be fit. 

And now, when I come out of this congressional hearing, on Friday we look at the next programs in order how can we help the 

dealers with the cashflow of their cars, for the cash position. Because one thing is very, very clear—and I’m damned sincere about 

this—the dealer profitability of this country is my first objective. 

And I said this on January 1st and I continue to say this. So, this 

is one part. 

And also, on Friday we look very intensively into the customer 

remedies and what we need to do to the customers. And there will 

be the first scenarios on the table. 

Mr. MURPHY. All right. Thank you. The gentleman’s time has expired. 

I now recognize the ranking member of the full committee, Mr. 

Pallone, for 5 minutes. 

Mr. PALLONE. Thank you, Mr. Chairman. 

Mr. Horn, your statements so far don’t give me much confidence 

that we are ever going to see a fix for these vehicles that are impacted. You know, you say that you can’t be fixed by a softwareVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00029 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
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only solution. You don’t have the necessary timetable as to when 

the fix is going to begin. 

Have you been given enough information about how the defeat 

device affects the engine to actually make informed judgments on 

whether the fix will actually work? I mean, how do we know that 

what you are proposing to do is actually going to work? 

Mr. HORN. Whatever I tell you here today is agreed and is coming from the Technical Engineering Department in Wolfsburg. And 

alongside our actions in Europe, we have to have our actions in the 

U.S. And the technical—— 

Mr. PALLONE. No, I understand, but is it fair to say that you 

really don’t know whether you can fix these vehicles to achieve the 

emissions standards? 

Mr. HORN. We know that we can fix these vehicles to achieve 

emission standards. 

Mr. PALLONE. All right. But, then, what happens with regard to 

other things like fuel economy, engine performance? You know, 

people bought these vehicles thinking that they were going to meet 

the emissions standards. They were going to have good fuel economy. They were going to have good engine performance. Can you 

guarantee that any fix you make to the vehicles doesn’t affect fuel 

economy or engine performance or both? 

Mr. HORN. At this point of time, my understanding is, if we correct the nitrogen oxide emissions to the emissions standards, the 

customer will get the MPG on the Monroney label. That’s my current understanding. Whether the full performance of the car—and 

this is something also our chairman, Matthias Mueller, or CEO, 

Matthias Mueller, said in Germany—maybe on top speed they 

might be, 1 or 2 miles per hour might be missing, but this is, of 

course, something which we will share with the agencies. But current understanding is that the customer will keep the Monroney 

label miles per gallon. 

Mr. PALLONE. I mean, the concern I have is, you know, when you 

buy one of these cars, you are relying on not only the emissions 

standards, but the fuel economy is good and the performance is 

good. I think you get to the issue of damages here. In other words, 

if I am an owner and the fix doesn’t achieve good performance, 

good fuel mileage, then I am going to expect to be compensated in 

some way if that is not the case. 

And I just remain concerned that any fix is going to substantially 

change the cars and that it is unfair to the consumers who bought 

the cars and relied on them because they expected them to perform 

a certain way. But you are telling me that the fix will guarantee 

good performance and will guarantee good fuel economy? 

Mr. HORN. I said, to my current understanding, in achieving the 

emissions standards, the Monroney label miles per gallon will be 

achieved. There might be a slight impact on the performance. And 

this is naturally not only the discussions with the agencies, but, of 

course, we will look into compensating our customers. And, of 

course, if there would be significant differences, this would be part 

of the discussion. 

Mr. PALLONE. Well, let me get to another issue. What about the 

impact on clean air? I mean, we know that there’s all kinds of 

health impacts, asthma, other respiratory illnesses that can seriVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
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ously affect people, send them to the hospital that get sick because 

of NOx and these other problems. I mean, you obviously agree that 

NOx pollution can result in serious health and environmental effects. I would assume you would agree with that. 

Mr. HORN. I have also read the EPA statement, that in general, 

and not specifically to Volkswagen, they have indicated that there 

might be respiratory problems which could also lead—I mean, I am 

quoting yesterday, basically—to hospital visits. 

Mr. PALLONE. Well, what are you going to do to rectify that? How 

do you plan to mitigate the harm caused by this excess pollution 

emitted into the air over the last 7 years? My understanding is 

that the NOx emissions from the affected vehicles are up to 40 

times the allowable limit. So, what are you going to do with regard 

to this excess pollution and the impact it may have had? 

Mr. HORN. I think there’s, first of all, many different studies. 

And so, I would like to go back to the EPA yesterday, of what they 

said. I think it will be part of the discussion. 

But I would also like to point out that, if you look at 100 percent 

of nitrogen oxide emissions in the U.S., the car and truck industry 

is having 5 percent. Our group here in the U.S. has 4 percent of 

the 5 percent, which is .2 percent. And of this, 20 percent is TDI, 

which is .05. And now, we can multiply this, which is not belittling 

this and it’s clearly unacceptable. But, within this context, clearly, 

the discussion will come up and needs to be addressed. 

Mr. PALLONE. All right. Thank you. 

Thank you, Mr. Chairman. 

Mr. MURPHY. I now recognize Ms. Blackburn for 5 minutes. 

Mrs. BLACKBURN. Thank you, Mr. Chairman. 

Mr. Horn, you said profitability is your top priority when you 

were speaking of the dealers and—— 

Mr. HORN. For the dealers, yes. 

Mrs. BLACKBURN. Yes. I would hope that safety, quality, integrity 

are top priorities, and profitability comes along there as a part of 

that picture. 

Let me ask you about this. Are you going to buy back the inventory that the dealers have? 

Mr. HORN. No, our plan is not to buy back—— 

Mrs. BLACKBURN. No? 

Mr. HORN [continuing]. The inventory. 

Mrs. BLACKBURN. Not to buy back? OK. 

Mr. HORN. Our plan is to fix the cars. 

Mrs. BLACKBURN. OK. Let me move on with you. Have you identified the individual or group of individuals that are responsible for 

the defeat device? 

Mr. HORN. These investigations are ongoing. 

Mrs. BLACKBURN. You have known about this since the spring of 

2014, a year and a half. 

Mr. HORN. We know about this since September 3rd, that the 

violation is there. And since this time and since the September 

18th Notice of Violation, the Board has acted and has asked Jones 

Day to investigate. 

Mrs. BLACKBURN. But you have known that there was some activity around this defeat device since the spring of 2014, correct? 

Mr. HORN. No, I did not know. As I have said—— 

28 

Mrs. BLACKBURN. OK. So, you did not know it in the spring—— 

Mr. HORN. No. 

Mrs. BLACKBURN [continuing]. Of 2014? 

Mr. HORN. No, again. 

Mrs. BLACKBURN. So, you just learned about it September 3rd, 

2015? 

Mr. HORN. Around the September 3rd events, yes. 

Mrs. BLACKBURN. OK. All right. Let’s go to your six-point remedy 

plan. You have talked some about point 3, which is that they are 

developing remedies. And I would assume, if this landed on your 

plate September 3rd, that you all have put all efforts and energy 

into this plan, correct, into the remedies? 

Mr. HORN. Yes, correct. 

Mrs. BLACKBURN. Very good. 

All right. Then, let’s go to point No. 1. You state that Volkswagen 

will examine its compliance processes and standards and adopt 

measures to make certain that something like this cannot happen 

again. 

Mr. HORN. Uh-hum. 

Mrs. BLACKBURN. So, why don’t you give us a little bit of specificity on that and what, if any, steps are currently underway to 

handle these compliance issues? What did you start as of September 3rd, 2015 and what is your timeline? How long is it going 

to take you to bring this into compliance? 

Mr. HORN. So, as I am the CEO of Volkswagen Group of America, I can only report to you on what is managed by Volkswagen 

headquarters worldwide at this point of time. And as I’ve said, it’s 

Jones Day. They manage all the investigations in terms of who did 

what, when, how, and why, and what do we need to do in order 

to rectify this for the future in terms of process adjustments and 

compliance adjustments. 

Mrs. BLACKBURN. So, then, you are saying that, as of now, you 

do not have a plan? 

Mr. HORN. As of now, we are still in the investigation phase. 

Mrs. BLACKBURN. OK. When can we expect you to have a plan 

to handle compliance, to make the owners of your vehicles whole, 

if you will, to make the dealers that have trusted in you, to make 

them whole? Also, the individuals that are employed by your facilities, when are they going to have some certainty as it relates to 

the jobs? 

So, you all say you are still investigating. So, on your timeline, 

when do you expect that you are going to be able to say this is the 

way forward? 

Mr. HORN. You mentioned six points, and we started with the 

first point, compliance. I don’t have a timeline for this yet. 

Mrs. BLACKBURN. OK. 

Mr. HORN. We are working instantaneously with the dealers and 

developing plans by the week as we go, as we go. And you can ask 

those folks behind me on whether this works or not. 

And for the customer, it depends on the technical remedies. So, 

again, this is Generation 3. January this year, January next year— 

sorry—we will start to give the software to the agencies. Generation 2, the middle of the year. Most probably, Generation 3, due to 

the technical complexity, will be a little bit later. So, there’s difVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
29 

ferent timings, and I apologize not for having a full-fledged plan of 

the Board by Volkswagen company right now here in my pocket. 

Mrs. BLACKBURN. So, you are certain it is going to be a multiyear 

plan? 

Mr. HORN. Excuse me? 

Mrs. BLACKBURN. You are certain the remedy will end up being 

a multiyear approach? 

Mr. HORN. Yes. If you look alone at 430,000 cars and the repairs 

might take 5 to 10 hours even in order to fix this, you know, technical fixes, and if you look at your recall history in this market, 

also with NHTSA, then these actions take, you know, 1 or 2 years 

minimum—minimum—when the fix is available for everybody, including parts and discussed with the agencies and agreed to. 

Mrs. BLACKBURN. OK. Let’s see, my time has expired. 

I do have one other question about point 2 in your remedy plan. 

Mr. Chairman, I will submit that and yield back the time. 

Mr. MURPHY. Thank you. Thank you very much. 

Now I recognize Ms. Castor for 5 minutes. 

Ms. CASTOR. Well, thank you, Mr. Chairman, for calling the 

hearing. 

Mr. Horn, according to reports, VW’s defeat device is found in 

nearly 500,000 vehicles. Are you confident in that number? Could 

it be more? Could it be less? 

Mr. HORN. We are very confident in this number. 

Ms. CASTOR. Pardon me? 

Mr. HORN. We are very confident in this number. 

Ms. CASTOR. OK. Have you calculated the loss in value to customers, car owners? 

Mr. HORN. No, not yet. That’s a matter of not only the investigations, but the calculations are ongoing. And on Friday, we will look 

at the first scenarios. 

Ms. CASTOR. OK. You have called your investigation preliminary, 

but you have known about this for a year and a half. The problems 

first came to light in May 2014, is that correct? 

Mr. HORN. No, this is not correct. As I explained, the study was 

published, and I had no reason to believe that there was a defeat 

device in those cars. 

Ms. CASTOR. Well, you found out, according to reports, in 2014 

that there was an issue, isn’t that correct? 

Mr. HORN. An emissions issue, yes, that’s correct. 

Ms. CASTOR. So, what did you do at that point in time? 

Mr. HORN. At that point of time, a plan was asked for from the 

engineers. And in July 2014, middle of the year, they presented a 

plan to me which was—and this is very important also—which was 

agreed and discussed with the Product Safety Committee worldwide. And these are those guys who manage all the recalls, all the 

service actions worldwide, including technical, procurement, legal, 

service, and those things. 

They came back with a plan, first of all, acknowledging that 

those results were correct and, secondly, with a clear timing on 

when those cars would get a software fix, which was also mentioned in one of the opening statements, as of the end of last year. 

Ms. CASTOR. Do you feel like you have been personally deceived 

now, after you found out subsequently that the defeat devices—— 

30 

Mr. HORN. Yes. Yes, and—— 

Ms. CASTOR. Explain that. 

Mr. HORN. Look, I worked 25 years for this company. And beyond my personal objective of dealer profitability, integrity, quality, 

you know, and not cheating, was always for me a given for this 

company. 

Ms. CASTOR. And another—— 

Mr. HORN. When I learned this, I am as touched and moved— 

sorry—as my employees and as my—— 

Ms. CASTOR. Another group feeling the effects of the VW defeat 

device defrauding are the VW dealers and their hard-working employees all across this country, in addition to consumers. A recent 

Associated Press article noted that dealers are facing, quote, ‘‘a lot 

of angry calls, emails, et cetera, from Volkswagen owners’’ who feel 

betrayed because they believed they had bought a car that polluted 

less without sacrificing all the good gas mileage and the performance that comes with a diesel engine. 

Mr. Horn, how many VW dealerships are there in the U.S.? 

Mr. HORN. We have round about 650 VW dealers and 350 Audi 

dealers. 

Ms. CASTOR. And on average, how much of a VW’s business do 

these diesel models—— 

Mr. HORN. Twenty-five percent. 

Ms. CASTOR. And these dealers are now the frontline—— 

Mr. HORN. Yes. 

Ms. CASTOR [continuing]. For unhappy customers who feel betrayed by the Volkswagen brand. And a media account yesterday 

quoted one dealer as saying, ‘‘This is the biggest fraud I’ve ever 

seen.’’ What do you have to say in response to that? What do you 

tell these business owners and their employees whose livelihoods 

depend on—— 

Mr. HORN. I went immediately out with the Dealer Counsel on 

a call. I made a dealer video which was sent out, and the dealers 

even showed it to their children, and their families, and their employees, because they said that’s the right thing on what we are approaching this. 

Ms. CASTOR. So, detail for us how VW is informing dealers about 

the defeat devices and the solutions to fix cars that feature these 

defeat devices. 

Mr. HORN. As soon as we have the information necessary already 

and have discussed this with EPA and CARB about the timing or 

alongside, the dealers will be naturally informed. 

Ms. CASTOR. They are not getting any information right now? 

Mr. HORN. No, of course, they get information. 

Ms. CASTOR. So, detail that for us. 

Mr. HORN. First of all, they get the information that we financially help them through this crisis. Secondly, the first thing is we 

took the bonus thresholds out. They have free flooring. They got 

the discretionary fund. We have increased the incentives by $2,000 

for a loyal customer, for loyal Volkswagen customers, you know, a 

loyalty program. 

Ms. CASTOR. What does that mean? 

Mr. HORN. That means we get them started and don’t let them 

dry out in the field. 

31 

Ms. CASTOR. Is that a direct payment to customers or to dealers? 

Mr. HORN. The first two points, the bonus payments and the 

floor plan, is directly to the dealers. The discretionary funds is directly to the dealers. And the incentives are, for them, this is a certain cash incentive that they can manage to bring loyal customers 

in, whether that is a TDI customer or a gas customer. 

Ms. CASTOR. So, is the intention there for the dealers, then, to 

contact customers who have purchased cars since the model year 

2009? 

Mr. HORN. Yes, as one of the possibilities, sure, yes. 

Ms. CASTOR. Well, VW is not giving any direction to dealers and 

their employees on contacting customers at this point in time? 

Mr. HORN. No, of course, we are having—we have set up frequently asked questions. We are guiding the dealers with real-time 

the same information we have, and which goes to all call centers 

as well, because those, you know, I have visited the call center in 

Auburn Hills. Those people are also frontline. They need the same 

information, and as soon as we have it, the other people get it as 

well. 

Ms. CASTOR. All right. What has VW told dealers about how existing Volkswagen models will be affected, cars that dealers have 

already sold and cars that are now sitting on the lots? 

Mr. HORN. We’ve informed the dealers directly on September 18 

in a call to the National Dealer Counsel. We followed up with letters and videos to do this. 

Mr. MURPHY. Thank you. 

Ms. CASTOR. OK, I am out of time. 

Mr. MURPHY. The gentlelady’s time has expired. 

I now recognize Mr. Barton for 5 minutes, from Texas. 

Mr. BARTON. Thank you, Mr. Chairman. And thank you and Ms. 

DeGette for organizing this hearing. 

I am not a Registered Professional Engineer anymore, but at one 

time I was. I still am an engineer by training. My daughter drives 

a Volkswagen Beetle. My former stepdaughter drives a Volkswagen 

Jetta. I don’t think they are diesel. I think they are gasoline-powered, but they are both Volkswagens. 

I have always had the highest respect for Volkswagen. I think it 

is a fine company engineering-wise, you know, product-wise. But I 

must tell you, sir, that it is extremely disappointing to look at 

the—I don’t know the right word to use—immorality of the corporate decision to knowingly and willfully cheat on U.S. emissions 

standards. 

I mean, Volkswagen is one of the premiere name brands of auto 

manufacturing in the world, and it is a reputation that has been 

gained over the last 50 or 60 years. And to have a company of your 

stature knowingly and willfully make a decision at the highest levels of the company to put a software program in your products that 

are meant intentionally to deceive or to cheat on U.S. emission 

standards, to me, I wouldn’t have believed it if it wasn’t factually 

proven. 

So, my first question to you is, I am told that this was a decision 

made in Germany at the corporate level. Is that correct? 

Mr. HORN. Two answers to this. First of all, the investigations 

are ongoing, but this was not a corporate decision, from my point 

32 

of view. To my best knowledge today, the corporation in no Board 

meeting or no Supervisory Board meeting has authorized this, but 

this was a couple of software engineers who put this in, for whatever reasons. And I would also like to find out, and I fully agree 

to your other statement. 

Mr. BARTON. And this is an oversight hearing, so I assume that 

you are testifying under oath, is that correct? 

Mr. HORN. I am under oath. I understand this, sir. 

Mr. BARTON. OK. So, what you are saying is that the senior, the 

president of Volkswagen International did not know about this 

when it happened? 

Mr. HORN. What I said was, to my understanding, this was not 

a corporate decision. This was something individuals did. 

Mr. BARTON. OK. Now that is not what I was led to believe, but 

I take you at your word. So, I will ask the second question. 

When did senior management, i.e., the president of Volkswagen 

International, the executive vice present, whoever your senior dayto-day corporate officers are, when did they learn of this action? 

Mr. HORN. To my understanding, also around the September 3rd 

notification of the agencies. 

Mr. BARTON. But it occurred years ago. 

Mr. HORN. Yes, sir. 

Mr. BARTON. Do you really believe, as good, as well-run as Volkswagen has always been reported to be, that senior-level corporate 

managers/administrators had no knowledge for years and years? 

Mr. HORN. I agree it’s very hard to believe. 

Mr. BARTON. Yes. 

Mr. HORN. And personally, I struggle as well, yes. 

Mr. BARTON. That is an honest answer. I appreciate that. 

Well, I don’t know what to do, but I do know that you can have 

an honorable disagreement about emissions standards, and we 

have had that on this committee. But, as somebody who voted for 

the Clean Air Act Amendments and as a conservative who believes 

that, if it is the law, it should be implemented, and corporate, especially international corporations should honor those laws, your 

company has not. I don’t know what the penalty should be, but it 

should be more than just a slap on the wrist. 

I mean, I am going to listen to the rest of the testimony and the 

questions and the staff recommendations, but in every other case 

since I have been a Congressman, when we have had problems 

with manufacturers, automobile manufacturers, in every case it 

has been something happened that was really a mistake, an accident, that they just didn’t foresee it. That is not the case here. 

Mr. HORN. Yes. 

Mr. BARTON. There was a knowingly and willful decision to deceive in one of the most important markets in the world, and that, 

sir, is just wrong. 

And with that, I—— 

Mr. HORN. We agree. 

Mr. BARTON. Thank you, sir. 

Mr. MURPHY. Thank you. 

I now recognize Mr. Kennedy for 5 minutes. 

Mr. KENNEDY. Thank you, Mr. Chairman. 

Mr. Horn, thank you for being here today. 

33 

I understand you have said several times your testimony is preliminary and there are investigations ongoing. So, I appreciate that 

and I recognize that. 

I do want to go back to what a number of my colleagues has gone 

to with regard to the timeline here. My understanding, and from 

your testimony, was that in the spring, I think specifically May of 

2014, was when Volkswagen became aware that there was some 

issue with regard to emissions, is that right? 

Mr. HORN. Yes. 

Mr. KENNEDY. And then, it was from May to December that 

CARB and EPA launched investigations into those, the emissions, 

and the company itself, VW, started an investigation as to what led 

to the oddities, if you will, with regard to the emissions testing, 

right? 

Mr. HORN. I can’t answer this really. I mean, I know that the 

actions to remedy these findings were discussed with CARB and 

EPA. Whether they have undergone their own investigations between May 2014 and December 2014, I don’t know. I know they did 

this afterwards, when we started to flesh the cars with the new 

software. 

Mr. KENNEDY. So, oK. If I tell you that EPA and CARB continued an investigation after that preliminary report from May and 

they continued their investigations, then December 2nd, 2014, VW 

shared test results with EPA and CARB and proposed a recalibration fix, is that accurate? 

Mr. HORN. Yes. 

Mr. KENNEDY. And then, VW initiated a voluntary recall of approximately 500,000 vehicles to try to deal with that recalibration 

issue. In May, CARB commenced testing, May 6th, I believe, 2015, 

CARB commenced testing to discern whether the fix that VW had 

proposed adequately and accurately fixed the underlying issue. 

Mr. HORN. Uh-hum. 

Mr. KENNEDY. May 6th through July 2015, CARB conducted laboratory and on-road testing to confirm the efficacy of the recall. 

What I am getting at here, sir, is July 8th CARB shared test results with VW and the EPA, prompting a series of technical meetings, from my understanding. And according to CARB, in the 

course of those meetings, VW disclosed that there were several 

issues, that Gen 1, Gen 2, and the 2015 model of the improved SCR 

vehicle known as Gen 3 had a second calibration intended to run 

only during confirmatory testing. So, there was some knowledge at 

least in July of this year that there was some manipulation of software code with regard to the testing, was there not? 

Mr. HORN. This meeting you’re referring to, I don’t know. I can 

tell you that the first issue that got back to me and to my attention 

was on the 20th of July when my people of Product Marketing 

came to me and said we don’t get the model year ’16 diesel certified. 

And then, I immediately wrote a letter or an email to Dr. Jakob 

Neusser, the EDP for Research and Engineering in Wolfsburg, and 

I escalated this. And the explanation was twofold: (A) There were 

new systems, and I don’t know whether this is right; and (B) there 

is still information missing. So, also my teams in Herndon with the 

34 

National Science Company did not have this information. And 

then, only in the weeks afterwards it started to unfold. 

Mr. KENNEDY. And so, sir, if I am understanding kind of the 

broad aspects of your testimony correctly, this is something—as 

you have said a number of times, this was not a company decision. 

This was a decision made by a number of individuals yet to be 

ascertained underneath at some other levels of the company that 

does not affect a corporate decision by the Board, by yourself. Is 

that accurate? 

Mr. HORN. That’s my understanding, yes. 

Mr. KENNEDY. So, as of now, at least according to press reports 

as of this morning, there’s four individuals that have been suspended. Is that right? 

Mr. HORN. I don’t know. This is press reports. 

Mr. KENNEDY. To your knowledge, has anybody been suspended 

to this point? 

Mr. HORN. I can’t share names with you. There is no information—— 

Mr. KENNEDY. I am not asking for names. Has there been anybody that has been suspended at this point? Has anybody, as of 

now, after Volkswagen, for knowing at least of some inconsistencies 

with test reports for the past 18 months, has anybody been suspended or lost their job? 

Mr. HORN. To my understanding, there have been three people 

suspended, but I cannot share the names here, due to German law. 

Mr. KENNEDY. And I am not asking for the names, sir. 

You mentioned the figures, roughly, that this would take 1 to 2 

years, 5 to 10 hours per car, in roughly 430,000 cars. Do you have 

any estimate at this point as to what the direct losses for Volkswagen would be because of this incident? 

Mr. HORN. I think the losses are depending (A) on the fines we 

will get and we will have to pay, and then, also, (B), on how much 

money it takes to fix those cars, and (C) on how much money we 

will have to pay to compensate the customers for what we did. And 

this is a whole lot of money, I’m quite sure. 

Mr. KENNEDY. And so, sir, I think the overall question that you 

are sensing from myself and colleagues is that I understand that 

this was a decision that you are indicating was made by people underneath you. It does get to the overall corporate integrity of the 

company. And so, what, if you can say, is going to be done to restore faith in the overall corporate structure of Volkswagen? 

Mr. HORN. First, a very important clarification. It was not done 

by people under me. I’m the CEO, president and CEO of Volkswagen Group of America. And those things have been developed in 

the relevant software departments in Germany, which is totally out 

of my jurisdiction or steering. 

And the second, to get your answer hopefully in the right way, 

with the compliance investigations, we have to streamline our processes and this company has to bloody learn and use this opportunity in order to get their act together. And 600,000 people worldwide have to be managed in a different way. This is very, very 

clear. 

Mr. KENNEDY. Thank you, sir. 

35 

Mr. MURPHY. I recognize the vice chair of the full committee, Mr. 

McKinley, for 5 minutes. 

Mr. MCKINLEY. Well, thank you, Mr. Chairman. 

Several things. First, you opted not to challenge the WVU decision, the research that was done. So, you have not challenged the 

research that was done. Everyone has recognized you did knowingly, then, violate, is that correct? 

Mr. HORN. I don’t understand this question, sir. I’m sorry. 

Mr. MCKINLEY. You opted not to challenge or appeal the findings 

from the WVU. So, does that mean—— 

Mr. HORN. From? 

Mr. MCKINLEY [continuing]. That you knowingly violated? 

Mr. HORN. No. No, sir. 

Mr. MCKINLEY. You did challenge and appeal the WVU findings? 

Mr. HORN. I did not challenge because software actions, recalls, 

service complaints, in the millions for this company, is normally 

doing business. I was worldwide Service and Parts executive for 

Volkswagen worldwide. I’ve been to the Product Safety Committee. 

I know how the system is working with all the experts and that 

we got a seal of approval onto those actions, and I’m not the technical experts. 

Mr. MCKINLEY. OK. 

Mr. HORN. It has enough people in the system—— 

Mr. MCKINLEY. Let me get to the crux more of my question. I 

know the EPA fines. We just had a situation where a small poultry 

farm was fined $17,000 a day because they were allowing dust to 

come out of their chicken house out into the neighbor. And we have 

seen steel mills being fined $3, $5, $7 million daily until they clean 

up their discharge into a river. We have seen coal mines and other 

operations. 

So, there has to be, I think you can understand there ought to 

be consequences for this violation. So, I am curious, I assume you 

are accruing something on your financial sheets for what could be 

a fair, what could be an expected penalty for having violated the 

laws here of the United States. Can you share with us or will you 

share with us what you are accruing on your balance sheet for penalties, expected penalties? 

Mr. HORN. Yes, yes. For the time being, I mean, there an official 

information that the company has accrued directly 6.5 billion euros 

in the first step in this year. Maybe this is enough; maybe this is 

not enough. I don’t know. And the rest will have to be worked out 

with the specific experts, as we have hired enough experts, I can 

tell you. 

Mr. MCKINLEY. Thank you. 

Now, when you import your vehicles in, you have to provide a 

Certificate of Conformity with the EPA standards. And from what 

I understand, the defeat device was not included in that Certificate 

of Conformity, is that correct? 

Mr. HORN. That’s my understanding, yes, sir. 

Mr. MCKINLEY. Can you share with us why someone tried to deceive the American Government, why that wasn’t included in the 

application of conformity? 

Mr. HORN. Because those people who did the applications most 

probably did not know, did not know that it was in there. 

36 

Mr. MCKINLEY. Can you share with us who is responsible for this 

failure to include a description? Is this limited to one, two people? 

Mr. HORN. We have an office which is called EEO in Auburn 

Hills which is directly linked to the German Research and Development Department. They work together. They get all the informations, all the results testing things, technical specifications, and 

then, they file the applications for conformity and all those. 

Mr. MCKINLEY. Mr. Horn, thank you for testifying before us. 

Just one question is, we have all, many of us have been talking 

about this defeat device. For the American public to understand 

what this is, can you explain what this defeat device is and how 

it functions? 

Mr. HORN. Yes. To my understanding, the defeat device is not a 

device, but it’s a software code in the engine and exhaust system 

management which detects, this software detects whether a car is 

on the dyno testing environment or whether the car is on the road 

being driven. 

And one example, for instance, is the steering wheel angle and 

how many times it has been changed. Because once a car is on the 

dyno, it is on the dyno. Nothing changes. And if the car is on the 

street, the steering wheel changes. And that since there’s so many 

sensors in there, these are one of the examples people gave me on 

how this device, which is a software code again, worked, but hidden 

in millions of software codes. So, if you don’t know this, it is very 

difficult to detect, from my limited technical understanding. 

Mr. MCKINLEY. Thank you. I yield back my time. 

Mr. MURPHY. Thank you. The gentleman yields back. 

I now recognize Ms. Schakowsky for 5 minutes. 

Ms. SCHAKOWSKY. Thank you, Mr. Chairman. 

I have in my hand a letter from Volkswagen that was sent to one 

of my senior staff because she is an owner of your car. I remember 

when she bought the car and how excited she was about the clean 

diesel. 

The letter says, ‘‘Your vehicle remains both safe to drive and 

legal to drive. You do not need to take any action at this time. All 

we ask is for your patience.’’ 

I have to tell you, if I were a driver of one of these vehicles that 

is contributing up to 40 times the amount of emissions, I would 

want that addressed right away. I have a son and a grandchild who 

regularly uses an inhaler. I am not excited about contributing to 

or driving a car that has that kind of emissions. 

So, how much patience is my staff supposed to have? What is the 

timeline here? What is the best scenario and the worst scenario in 

terms of timeline for fixing this? 

Mr. HORN. For the Generation 3 cars, this is model years ’16 and 

’15, the timeline is beginning of next year a complete fix. For the 

Generation 2 cars, it’s still under development. This won’t start, 

from my judgment, before the middle of next year. And for the 

Generation 1 cars, which is the biggest feat, I cannot give you a 

date right now, but within the next couple of weeks we will start 

discussing those scenarios with EPA and CARB, and alongside the 

development guys will have to do that—— 

Ms. SCHAKOWSKY. So, these cars unfixed could be on the road for 

more than a year, let’s say? 

37 

Mr. HORN. Yes. 

Ms. SCHAKOWSKY. Or 2 years? 

Mr. HORN. More than a year, definitely. 

Ms. SCHAKOWSKY. I wanted to follow up on a question that Mr. 

Pallone asked. It sounded like you were saying that the fix could 

manage fuel economy, engine performance, and emissions, that all 

of that could be fixed. If that is so, why didn’t Volkswagen do that 

initially? Why wouldn’t you make a car that would achieve those 

goals? 

Mr. HORN. I think it’s a great question. 

Ms. SCHAKOWSKY. I mean, I can only assume that maybe cheating was cheaper? 

Mr. HORN. To my understanding, what I’ve learned, some people 

have made the wrong decisions in order to get away with something which will have to be found out. 

Ms. SCHAKOWSKY. Let me ask you this: have you considered financial compensation—for example, allowing customers to actually 

return the car for what they paid for it? 

Mr. HORN. This is one of the areas we’re looking into right now 

in terms of how to compensate our customers, yes. 

Ms. SCHAKOWSKY. Providing rebate for lost value of the car? 

Mr. HORN. Sure. 

Ms. SCHAKOWSKY. And what about right now, if I had one of 

those cars and I wanted a loaner, would you compensate the dealer 

to give me a loaner instead of having to drive that polluting car? 

Mr. HORN. We would have to discuss and consider this. Right 

now, I would say no, honestly, because the EPA has said these cars 

are legal and safe to drive. 

Ms. SCHAKOWSKY. And so, even you know that there is up to 40 

times more pollution, if I went to my dealer, who might because 

they are in a fix right now say, ‘‘OK, well, we will give you a loaner,’’ the company would not do anything to make ultimately your 

customer happy? 

Mr. HORN. So, there’s a general policy, and this is exactly the 

reason why we gave the dealers the discretionary funds which they 

could use at their discretion in order to help customers, very significant cases. And whether they do a loaner car program for the 

specific customer or whether they take them out of the car, or 

whatever they think is best in this specific customer’s situation, 

they can do it with this money. No questions asked, yes. 

Ms. SCHAKOWSKY. But there is no policy that dealers could say 

that loaners would be available? I realize 500,000 loaners would be 

probably a hard thing to do. 

Mr. HORN. Right. 

Ms. SCHAKOWSKY. But you see how that would be a desirable 

remedy for many people? 

Mr. HORN. I understand your point, yes. 

Ms. SCHAKOWSKY. Yes. Well, I just want to tell you, as a consumer advocate all of my life, this is pretty shocking for people to 

find out that a company—we have had a number of recalls. I have 

had a recall on one of my cars. But to find out that a company has 

deliberately cheated, it seems to me that asking customers for patience is just really not sufficient. 

38 

I heard people on the radio who were repeatedly saying, ‘‘I just 

want you to take back my car and give me the amount of money 

that I paid for it. I don’t want that car. I don’t want a fix because 

it may not provide exactly what I thought I was buying in the first 

place.’’ I would hope that your company would consider that as a 

primary remedy. 

And I yield back. 

Mr. MCKINLEY (presiding). Thank you. 

The Chair recognizes Dr. Burgess for his 5 minutes of questioning. 

Mr. BURGESS. Thank you, Mr. Chairman. 

And let me just stress that I am as far ideologically from Jan 

Schakowsky as possible, and I am not here to provide you advice, 

but I think she is giving you good advice. I have been on this subcommittee for over 10 years. 

I have been through Toyota. I have been through General Motors. And now, we are doing this investigation. And let me just suggest to you, and let me just suggest to your corporate structure in 

Germany, that being dismissive and minimizing the problem that 

is faced by consumers, dealers, suppliers is not in your best interest and it will hurt you. So, I would be aggressively compliant and 

aggressively trying to make it right for your customers, dealers, 

and suppliers because in the grand scheme of things I actually believe that will be less costly in terms of dollars, in terms of reputation, and just in terms of the endurance of the brand in the United 

States, which you have already heard from members of this committee is significant. Our histories with your company all are significant. They go back a significant way. 

Now that I have gotten that off my chest, let me just ask you 

once again—you have been asked before—but are these vehicles 

safe to drive? 

Mr. HORN. Yes. Yes, the EPA has said these vehicles are safe to 

drive. 

Mr. BURGESS. So, this is unlike some of the other recalls that we 

have talked about in this subcommittee, problems with airbags, 

problems with electronic throttle controls. These do not pose an immediate jeopardy to the life of the driver or the passengers? 

Mr. HORN. I trust the judgment of the EPA, yes. 

Mr. BURGESS. Now, trusting judgment, that is what we are doing 

here today, is we are talking that trust factor has been eroded. 

Let me just ask you, when you stress that you are the CEO for 

Volkswagen of America, is that correct? 

Mr. HORN. Yes, sir. 

Mr. BURGESS. But do you travel back and forth to Germany from 

time to time? 

Mr. HORN. Too often right now not much. 

Mr. BURGESS. Yes, well, have you been in the month of September? 

Mr. HORN. Yes, usually once a month, yes. 

Mr. BURGESS. Usually once a month? So, as this problem has 

evolved or the information about this problem, have you gone to 

the engineers over in Germany and said, ‘‘Guys, what’s up here? 

How did this happen?’’ Have you looked at any lines of software 

code where someone has identified for you this has happened or 

39 

have you held in your hand a defeat device that was added to an 

automobile? 

Mr. HORN. Personally, I have taken out Mr. Mueller of conference rooms, Dr. Diess out of conference rooms, and personally 

talking intensively to the engineers on how we make this right. 

And to other questions, you know, ‘‘How is this possible?’’, ‘‘Who 

has done what?’’, they said, ‘‘We didn’t know ourselves.’’ 

Mr. BURGESS. Yes, but do you understand how that just defies 

credulity? I mean, here is a software program—— 

Mr. HORN. Yes. 

Mr. BURGESS [continuing]. That wasn’t just written, I mean, I am 

suggesting here it was written by one person in their basement in 

the dark of night. I mean, this had to be a team of people who were 

working on this. 

You have got these rascals over here at the EPA in the United 

States, and they are just hard to deal with. So, we want to do 

something that we will be able to sell our cars, and we will just 

trick them. We will just trick them. And then, somehow you are 

going to integrate that into the supply chain of a multinational corporation, and nobody knows a darn thing about it? I mean, that is 

what you are asking us to believe. And you understand why, and 

you have heard it from a number of members, the incredulity that 

that could, in fact, happen in a large multinational corporation. 

Mr. HORN. I fully agree, sir. 

Mr. BURGESS. Have you asked that question to the people—— 

Mr. HORN. Yes. 

Mr. BURGESS [continuing]. Who are superior to you at Volkswagen in Germany? 

Mr. HORN. Who was superior to me, the guy is not on board any 

longer. He is called Christian Klingler. He resigned due to other 

reasons. 

Mr. BURGESS. Well, I almost just don’t know what to say. Apparently, in the public domain in the early or middle part of the last 

decade there was some suggestion that Volkswagen, in an effort to 

try to sell its diesel high-mileage vehicles in this country, was in 

the process of leasing software to deal with this emissions problem 

from another company, is that correct? Blue Tech Software, I believe, is the name that is used. 

Mr. HORN. I have read this in the newspapers, yes. 

Mr. BURGESS. OK. So, it is in the newspapers. Have you, yourself, looked at why did they look at this and, then, stop those negotiations for those leases? What changed? Did we develop some technology at Volkswagen? Did we develop a defeat device at Volkswagen? I mean, these are some of the questions that are just going 

have to be answered. 

Mr. Chairman, let me just say that I recognize and I appreciate 

Mr. Horn being here. I think that we are doing this hearing prior 

to the time that your document production deadline expired. So, we 

recognize that you are here voluntarily and it is your sincere effort 

to comply with the wishes of the committee. 

But let me just say, all of us represent dealers, consumers, suppliers, and their lives and livelihoods are extremely important to 

us. And that is what we have got to keep first and foremost. 

I yield back, Mr. Chairman. 

40 

Mr. MCKINLEY. Thank you. 

And the Chair recognizes the gentleman from Texas, Mr. Green, 

for 5 minutes. 

Mr. GREEN. Thank you, Mr. Chairman. 

And for our witness, we have other subcommittees going on. So, 

you will see members come in and out during the day. 

When I first heard about it, I was amazed that a company that 

is as great as Volkswagen could let this happen, and even to the 

executives maybe who didn’t know, because the image of the company, not only in our country, but in Europe and around the world, 

is so great. 

Our committee wants to get some answers, and I would like to 

understand more about Volkswagen’s own investigations in your efforts to find the cause of the debacle. News reports discuss several 

internal and external investigations initiated by Volkswagen. Mr. 

Horn, please explain Volkswagen’s own investigations into this incident and how they are different from each other. 

Mr. HORN. The investigations started—I talked yesterday to our 

head of Group Revision—on September 22nd, this year, went on 

with our own Group Revision Department, Group Compliance 

Audit Department until September 29th, for one week. And then, 

all the documents, all the preliminary documents were turned over 

to the American law firm Jones Day, who is investigating this on 

behalf of our Supervisory Board. 

Mr. GREEN. OK. News reports have discussed several internal 

and external investigations. So, that was the only one you had, 

that was the auditors from September the 22nd to the 29th? Are 

there any other investigations Volkswagen is conducting? 

Mr. HORN. To my understanding, after the Notice of Violation, 

and from September 18th, from CARB and EPA, these investigations have started right away. And this is what I have told you, 

to my best knowledge. I don’t know of any other investigations. 

Mr. GREEN. Do you know if the actions are in the United States 

or Germany or in both or everywhere where Volkswagen has sold 

these vehicles? 

Mr. HORN. Worldwide. 

Mr. GREEN. OK. Would you commit to sharing these investigations with the committee, the results of these investigations? 

Mr. HORN. I commit to get as much information as possible to 

this committee, yes. 

Mr. GREEN. OK. Thank you. 

Last week one news outlet reported that, quote, ‘‘The Steering 

Committee of the carmaker’s Supervisory Board met last Wednesday to discuss the preliminary findings of the probe into the scam.’’ 

And that is a quote. What were these preliminary findings that 

were revealed last Wednesday? 

Mr. HORN. Sorry, I’m still a little bit confused by those folks here 

down there clicking all the time. Could you please repeat your 

question, please? 

Mr. GREEN. OK. There is a quote, ‘‘The Steering Committee of 

the carmaker’s Supervisory Board met last Wednesday to discuss 

preliminary findings of an internal probe into the scam.’’ What 

were these preliminary findings that were released last Wednesday? 

41 

Mr. HORN. Our own Supervisory Board of Volkswagen AG. I 

don’t have access to these preliminary findings. 

Mr. GREEN. Can you get a copy of it and share it with our committee? 

Mr. HORN. I can definitely try, sir. 

Mr. GREEN. Pardon? 

Mr. HORN. I can try, sir. 

Mr. GREEN. OK. You are the CEO. 

Mr. HORN. I am the CEO of this company, and then, there’s the 

Supervisory Board and there’s a group of people who are quite 

above me in Germany, and the Supervisory Board has to make this 

decision. 

And I think, you know, with the commitment that our company 

has, there is a very good chance that the company will provide at 

one point of time the necessary documents to provide more clarity 

into these facts here and to this issue. 

Mr. GREEN. Again, like my colleague, I appreciate you being here 

voluntarily, but it would be great if we could actually get that in 

our committee for our investigations. 

According to a September 30th news report, Volkswagen’s Supervisory Board member Olaf Lies said, quote, ‘‘These people who allowed to this happen or who made the decision and saw this offer, 

they’re acting criminally. They must take personal responsibility.’’ 

Mr. Horn, do you agree with that? 

Mr. HORN. Yes, sir. 

Mr. GREEN. OK. Do I have your commitment to full cooperation 

in finding and addressing the roots of the deception? 

Mr. HORN. Sure. Yes, sir. 

Mr. GREEN. And again, our committee is ongoing, our investigation. And I appreciate your being here. 

Mr. Chairman, I will yield back my time. 

Mr. MCKINLEY. Thank you. Thank you. 

For the rest of the members with questions, I know we have got 

a break here in 20 minutes, but we have got 7 people that want 

to speak. So, we are going to be very short on the timeframe with 

this. 

But the Chair recognizes Mr. Griffith for a short list of questions. 

Mr. GRIFFITH. Thank you. I appreciate it. 

As you have heard from others who have owned cars and learned 

to drive, I am one of those as well. My mother was able to afford 

her first new car, which was a Volkswagen Squareback. And that 

is what I learned to drive on. It was a manual. I have inherited 

my grandmother’s 1972 Super Beetle, which I still have. 

In the eighties I drove a Rabbit. In the nineties, I bought a gaspowered Jetta. When it got close to 200,000 miles, my mother convinced me that even Volkswagens couldn’t go on forever. She might 

have been wrong. I sold that car and bought a 2003 gas-powered 

Passat, which I drove until this summer and got 376,225 miles. 

And the people who bought it from me are going to tell me when 

it crosses 400,000. They think that there won’t be any problem in 

doing that. 

As a backup to my 2003 Passat that was going and going and 

going like the Energizer rabbit or bunny, I bought a 2012 Volkswagen diesel. So, everybody else is talking about what are conVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
42 

sumers thinking. You are looking at him. I am your consumer. I 

am your Volkswagen driver who has always trusted your company, 

and I am very disappointed. 

So, what are we going to do? First, you have indicated—and 

there could be some differences in understanding in language—you 

have indicated that you have notified the customer. I have checked 

with the previous owner. I bought the car from a friend. They have 

not received any notice that this 2012 diesel Passat is affected. 

When you go to the Web site, it says that you all received notice 

from the EPA that some of your two-liter, four-cylinder TDI vehicles don’t comply, and among the included vehicles, of course, is the 

2012. 

Because I am not skilled like Chairman Murphy, I am not skilled 

and I couldn’t take a car apart. I had a hard enough time figuring 

out how to get the top off, the plastic lid off of the engine to try 

to take a look at it. 

But, when you see that and it says some of the cars are affected, 

and here’s one, and the original articles referenced the ’14s and 

’15s, but didn’t say anything about the ’12s and the ’13s, and then, 

you see a Volkswagen document that says discrepancies relate to 

vehicles with Type EA 189 engine, and I am looking in my manual 

and I am looking at things on the engine block, and it doesn’t say 

anything about an EA 189 engine. 

Now the team on the committee here and, then, my staff have 

figured out I am affected. We know that. But this was done at 

great trouble. I have received no letter. I can’t tell for sure. 

And I will tell you what was interesting was we found that there 

was actually a site in the UK—and I know you are just America 

and I am just talking about America—where you can actually plug 

in your VIN number and it will tell you if you are affected. I would 

encourage you to consider that because, while you may think you 

have notified everybody, not everybody is capable of taking apart 

the engine and figuring out if they are an EA 189. 

And then, the other big question is, am I Generation 1 or Generation 2? They tell me I am Generation 2, which I found surprising based on the numbers that you have testified here today. 

Can you confirm that I am a Generation 2? 

Mr. HORN. If you have 2012 Passat, I would think so now, right. 

Mr. GRIFFITH. OK. 

Mr. HORN. Yes. 

Mr. GRIFFITH. And so, this is something else that you might 

want to put into your—it is a pretty simple Web site that takes the 

VIN numbers that are affected and says you are Generation 1, you 

are Generation 2. Because it sounds like the fix, as I am listening 

today, the fix to the Generation 2 is more simple than the fix to 

the Generation 1. Am I correct in hearing that today? It is a simpler fix for Generation 2 than for 1? 

Mr. HORN. Yes. 

Mr. GRIFFITH. And then, I would have to echo what Representative Schakowsky and Dr. Burgess had to say. You know, when you 

buy a vehicle, even if you bought it used, and you are looking in 

the manual and it says, ‘‘Under Federal Emissions Control System 

Defect Warranty, was designed, built, and equipped so as to conform at the time of sale with all applicable regulations of the 

43 

United States Environmental Protection Agency (EPA), and is free 

from defects in material,’’ et cetera, I believe that I was sold something that was different than what it was purported to be. 

And my friend didn’t do the defrauding. It was the Volkswagen 

company. I think you are much better off to come up with a program that buys these cars back because, you know, I understand 

it wasn’t your folks in Chattanooga that made this mistake, it was 

the folks in Germany. But you have got to restore trust, and one 

of the ways to do that is to stand behind your vehicle. 

One of the reasons that I have liked the company is that on my 

1990s version something was wrong with the paint. No questions 

asked. When I took it into First Team Auto Mall in Roanoke, they 

said, ‘‘Not a problem. We’ll take care of it.’’ And it was done. Never 

had another problem. 

This is a much bigger problem, but Volkswagen needs to stand 

up and say, ‘‘OK, we understand. We will buy your car back at 

what the fair market value of that vehicle was prior to this notice 

coming out.’’ 

With that, I see my time is up and I yield back. 

But thank you for being here. 

Mr. MCKINLEY. Again, thank you again. We have now 12 minutes. So, I am asking those again, please, to keep their questions 

short. 

The Chair recognizes Mr. Yarmuth from Kentucky. 

Mr. YARMUTH. Thank you, Mr. Chairman. 

Thank you for appearing, Mr. Horn. 

I suspect that I should be feeling a sense of schadenfreude here 

today because Ford Escapes and Lincoln MKCs are made in my 

district, and presumably, we will be selling some more of those 

while you are out of the marketplace. But I am not really taking 

any joy in any of this. 

I just have a couple of quick questions. The article I read said 

that there were about 11 million vehicles worldwide affected by 

this. 

Mr. HORN. Yes. 

Mr. YARMUTH. So, they contain the defeat device. I guess there 

is no added cost to put it in since it is just a line of computer code. 

Would that be right? 

Mr. HORN. It seems very logic, sir, yes. 

Mr. YARMUTH. Yes. So, my question is, how many countries that 

these 11 million vehicles were sold in have emission standards that 

would have been defeated by this device? I mean, if the United 

States we are talking about a half a million cars, roughly, out of 

11 million, what are Germany’s emission standards, for stance? Are 

they stricter than the United States? 

Mr. HORN. I mean, there’s many countries affected. All the countries in Europe are affected. The emission standards for diesel cars 

in Europe are different to the U.S. You have currently the E05 and 

going into E06 here. You have been 5. 

And there’s two differences. First of all, nitrogen oxides are much 

more stringent here. It’s 5 grams, I think, per mile, or whatever. 

And in Europe it is now 30 to 40. So, this is quite—it is higher. 

It is higher in Europe, but in Europe what is stricter is the diesel 

part of the particle filter emissions. There are these little diesel 

44 

particle filters coming out. On that, the European laws are much 

stricter than the U.S. 

Mr. YARMUTH. My question is, would this defeat device that is 

11 million vehicles have helped deceive the European countries’ 

standards as well? 

Mr. HORN. I can only give you my understanding at this point 

of time. But, as you know, there are lots of European countries investigating this, and we are working with those agencies, also with 

the German KBA, which is the responsible agency. People had to 

report there, and this is being investigated. 

Since the standards are different, my understanding is that the 

defeat device is in those cars as well, but to what degree it is really 

affecting the emission laws, I don’t know. 

Mr. YARMUTH. OK. I appreciate that answer. 

And I just want to say before closing that it is very refreshing 

to hear my colleagues from the other side defend the Clean Air Act 

and talk about emissions. I appreciate that. It is a rare occurrence. 

I yield back. 

Mr. MURPHY (presiding). Mr. Collins is recognized for 5 minutes. 

Mr. COLLINS. Thank you, Mr. Chairman. 

Since I am always, and again this time, one of the last to question you, I guess what I have picked up here, and I hope you can 

relay back to your Board, the folks running Volkswagen back in 

Germany, is that the response so far is inadequate. 

I would tell you from my perspective it is a sign of arrogance. It 

is a sign of not admitting yet the severity of your problem. 

I will tell you I am an engineer, and I have a way of thinking. 

And I cannot accept VW’s portrayal of this as something by a couple of rogue software engineers. 

I would begin by saying, isn’t intellectual property and patented 

work a very important part of what makes VW, VW? You are constantly looking for breakthrough technology that you can patent? 

That is a big part of your company, isn’t it? You pride yourself on 

that engineering. 

So, you are having us believe—and I think this is the way an engineer’s mind works—back in 2009 you were trying to figure out 

a way to have clean diesel, top performance, and your engineers got 

stumped. The NOx emissions were not even close. Would that be 

true? 

Mr. HORN. What is stumped? 

Mr. COLLINS. Stumped, confused. They couldn’t get through it. It 

was an insurmountable roadblock. They couldn’t give performance 

and emission control at the same time. They were 40 times over 

the NOx emissions. 

Mr. HORN. It seems to be logic, what you are saying—— 

Mr. COLLINS. Right. 

Mr. HORN [continuing]. But I don’t know. 

Mr. COLLINS. So, then, if I am working in VW engineering and 

I am always looking for intellectual property that I can patent and 

give me a competitive advantage—and I know this is a problem, 

and I have to tell you this problem was going way up the chain. 

‘‘We can’t do it. The NOx standards in the U.S. are not what they 

need to be. We can’t do it.’’ 

‘‘Well, go work harder. Go find a solution.’’ 

45 

People are coming back. ‘‘We still can’t find a solution.’’ The Engineering Manager, ‘‘We can’t find a solution.’’ 

And then, all of a sudden, two software engineers, like they 

found pixie dust, come in and say, ‘‘We found a solution. We’ve got 

it. We fixed it.’’ 

Now you are telling me these two engineers snuck that computer 

code into the software and no one said, ‘‘This is breakthrough technology. I think we need to run this up the ladder with our attorneys and our engineers. We need to patent this. This is intellectual 

property that is going to give us an advantage. We can meet the 

NOx standards and the performance standards, and we had a 

breakthrough. We went from 40 times the emissions to we met the 

emissions’’? 

And VW is trying to get the United States of America to believe 

these are a couple of rogue engineers? I categorically reject that. 

Either your entire organization is incompetent when it comes to 

trying to come up with intellectual property—and I don’t believe 

that for a second—or they are complicit at the highest levels in a 

massive coverup that continues today. 

Because just the very 5 minutes that I have been here, and as 

an engineer, and I am not a Ph.D., my mind immediately jumped 

to, with this being true, why didn’t we look for patents? Why didn’t 

we ask the questions what the pixie dust was? They have fixed this 

thing miraculously. This didn’t happen in one day. This didn’t happen in one month. Your engineers were looking at this, I can tell 

you, for many months. They were stumped. They couldn’t come up 

with it. 

And then, all of a sudden, the solution is there, and VW is trying 

to tell us in the United States of America, in this Congress, that 

it was a couple of rogue engineers. Well, if that is true, then your 

entire Patent Department should be terminated, because this 

would have been massive breakthrough technology that would have 

given VW a true advantage, not by cheating, but a true advantage 

in clean diesel technology. 

I would like you to take that back to your Board and have them 

ask that question: What was going on in the patent world? What 

was going on in the engineering world? Because I can tell you personally I categorically reject everything that VW is saying about a 

couple of rogue engineers. And I can tell you that suspending three 

folks, it goes way, way higher than that. 

And what I would like to conclude with, sir—again, I am also a 

financial guy, I am an entrepreneur—I would suggest that you be 

honest to your shareholders. Six point five billion euros is off by an 

order of magnitude. Five hundred thousand vehicles at $40,000 

apiece, if you were to buy those back—and I would suggest you 

start doing that tomorrow—that is 20 billion there. I would suggest 

you are off by an order of magnitude. And if you had told us today 

you had set aside $68 billion, I would say you are probably in the 

ballpark. Six point eight, not even close. 

With that, Mr. Chairman, I yield back. 

Mr. MURPHY. The gentleman yields back. 

I now recognize Mr. Welch for 5 minutes. 

Mr. WELCH. Thank you very much. 

46 

Sir, thank you for coming in. But I just want to express to you 

some of the things that I have been hearing from Vermonters. 

First of all, we have got VW customers, we have got VW dealers 

in red States and in blue States, and they are mad as hell. Some 

of the questions that came to me from Vermonters, and I want to 

submit this to the record and ask you, VW, to answer these questions from Vermonters. 

[The information appears at the conclusion of the hearing.] 

But let me just give a reflection of what these say. 

Number 1, ‘‘What will’’—you, VW—‘‘be reading [when you are] in 

jail?’’ 

Number 2, ‘‘I just wonder what the hell [you] were thinking.’’ 

Three, ‘‘How can we help out Vermonters who got these lemons?’’ 

Four, ‘‘Why should the U.S. allow you to sell vehicles in this 

country?’’ 

Five, ‘‘VW is the Lance Armstrong of the ... industry.’’ 

These questions go on and on and reflect the white-heat anger 

that folks have about the deception. 

One last question, ‘‘How do you sleep at night? ... How [do] you 

call yourself a member of the human race when you knowingly ... 

poison the planet?’’ 

And then, I talked to some of our VW dealers. They care about 

their customers, and I know you individually do as well. And one 

of the dealers said this is on the scale of Enron and Bernie Madoff. 

That is how deceitful and unnecessary and willful it was. 

They will stand by their employees, our VW dealers, but this is 

going to be an expense to them because they are not selling cars 

that are bringing in profits. So, they are going to have to pay out 

of their own pocket, and they will do that because they are loyal 

to their employees. 

But I have one major question. Just last week, BP reached a settlement with the Justice Department over the massive 2010 Gulf 

oil spill that killed 11 workers and devastated the environment and 

the economy of the Gulf Coast. That settlement allowed BP to shift 

more than half of its $21 billion fine to the American taxpayer by 

taking advantage of a loophole in the U.S. Tax Code. In my view, 

that is wrong. The wrongdoer, not the taxpayer, should pay all of 

the settlement. 

And the question I have is this: Will you commit here today 

under oath that VW will not use this loophole to write off any future settlement payments related to the fraudulent and deceptive 

activity to which VW has already admitted, sir? 

Mr. HORN. If you want a clear answer under oath, I would have 

to really understand these tax loopholes, and I don’t understand 

them. But I—— 

Mr. WELCH. Let me explain it very simply. BP got to write off 

about half of the cost of that, and that shifts the burden to the taxpayer instead of their shareholders. 

Mr. HORN. My understanding is that we will work very hard in 

order to get this right and that there should not be a burden to the 

taxpayers—should not be. 

Mr. WELCH. Thank you. 

Another question, taking up where Mr. Collins was, I know you 

individually are appalled at what happened at VW, and you have 

47 

asked your question, ‘‘How did it happen?’’ Someone somewhere 

made a decision to make it happen. 

Mr. HORN. Uh-hum. 

Mr. WELCH. Someone somewhere implemented that decision. You 

have asked yourself how that happened, correct? 

Mr. HORN. Yes, sir. 

Mr. WELCH. And your answer to yourself is what? 

Mr. HORN. My answer to myself is that I do everything—and I 

don’t sleep at night—to help our dealers, to help our customers, 

and to be there for my company and my employees to get us 

through this crisis here in the U.S. 

Mr. WELCH. I appreciate that, and I know that is true. You individually have a very good reputation, sir. 

Mr. HORN. Thank you. 

Mr. WELCH. But I asked you another question. You know the 

company. You have asked yourself who and how. And in your own 

mind, I am asking you to share with us your own view about who 

and what, that it could happen in the corporate structure of VW. 

Mr. HORN. I think this is a speculation if I would start now. But, 

you know, I’m reading newspapers, as well, and there’s been lots 

of articles around there. And from my personal feeling, this was 

pressure in the system to get resolutions and, also, in conjunction 

with cost pressure as well. This was discussed already here in one 

of the other instances. 

And I think it is dead wrong if you put corporate profits before 

people, and I think we have to get to the point that we put people 

first and not the pressure and corporate profits. 

Mr. MURPHY. Thank you. 

Mr. WELCH. What people in what department—my time is up? 

Mr. MURPHY. Yes, your time is up. 

Mr. WELCH. I yield back. 

Mr. MURPHY. Thank you. 

I now recognize the gentleman from Texas, Mr. Flores, for 5 minutes. 

Mr. FLORES. Thank you, Mr. Chairman. 

Mr. Horn, thank you for joining us today in an obviously tough 

situation for your company. 

VW’s actions damaged the trust of the American people as well 

as the environment for billions around the globe. They have also 

economically damaged their customers, their dealers, and their 

shareholders. And I hope that VW will continue to work on the correct and fair resolution of those issues. 

I want to get more in the weeds now to try to go through and 

fill in the blanks in the record on some dates and the who, what, 

where, when, as we have talked about before. 

In May of 2014, independent researchers published a report that 

first identified higher-than-expected on-road emissions in VW vehicles, which prompted the investigations by CARB and the EPA. 

So, question No. 1 is, when did VW first become aware of this 

research? 

Mr. HORN. The end of April when it was published. To my knowledge, it was published the end of April. Mid-May I got information 

about this. 

48 

Mr. FLORES. OK. What steps did VW take to evaluate the conclusions of the research at that time? 

Mr. HORN. First of all, to acknowledge that emission violations 

or higher emissions are not legal. Secondly, the engineering departments were supposed to recheck those testing results on our own 

equipment in order to validate this. And then, thirdly, to correct 

this with respect to software actions which have been implemented 

in the end of last year. 

Mr. FLORES. OK. Now where was this done? Was this done 

Volkswagen Germany or Volkswagen U.S.? And who did that? Who 

was responsible for that? 

Mr. HORN. The software applications management for the engines and, also, for the exhaust systems are being done in Germany 

at the Engine and Drivetrain Department within the Research and 

Development Division. 

Mr. FLORES. OK. The EPA and CARB both described a series of 

presentations or discussions with VW in the wake of the research 

in May of 2014. Who for VW was interacting with EPA and CARB? 

Were those individuals part of VW America or VW AG or both? 

Mr. HORN. That’s something I would have to check, and maybe 

this is also in the records provided to you next week. 

Mr. FLORES. OK. Great. 

What did VW America understand about the cause of the higher 

on-road emissions between May of 2014 and the voluntary recall in 

December 2014? In other words, what did you and your team at 

VW America know what was going on? What had VW Germany 

told you? 

Mr. HORN. That they have, to my understanding, validated those 

test results and developing software fixes in order to get this back 

in line, and three different tech talk versions which I didn’t understand, to be also very honest, in order to bring this in the car. 

But, also, as I said, all these things are vetted through this Product Safety Committee which is worldwide responsible for this and 

which is also looking at the track, for instance. And in this context, 

I trusted those guys and those processes, that everything was according to the book 100 percent. 

Mr. FLORES. OK. So, at that time, nobody in VW America knew 

that there was cheating going on in the software design? 

Mr. HORN. To my understanding, no. 

Mr. FLORES. OK. Then, in December of 2014, VW conducted a 

voluntary recall that, at least in part, sought to address the higher 

on-road emissions in the model year 2009 through model year 2014 

vehicles that were subject to the allegations. Would you explain 

what you understand this recall was intended to do? 

Mr. HORN. To correct the studies of the University, I think the 

results of the study of the University of West Virginia, our retesting to bring the cars, all the cars, back into compliance. 

Mr. FLORES. OK. But that fix to the emissions problems that was 

implemented as part of that recall didn’t resolve the issue of higher 

on-road emissions. So, the question is, who was responsible for developing that technical solution that was implemented in December 

of 2014? 

Mr. HORN. The same Engine and Drivetrain Division within the 

Engineering and Development Department or Division in Germany. 

49 

Mr. FLORES. The folks in Germany? OK. 

And so, what role did VW of America have in developing or validating that solution? 

Mr. HORN. We just have this office in Auburn Hills who do the 

applications. There’s also a testing facility in Oxnard in California 

who also had those folks in testing, but, to my understanding, dyno 

testing, as far as the legal situation was concerned. 

Mr. FLORES. OK. So, just to be clear, VW America did not develop the solution or played no part in development of the solution? 

Mr. HORN. No. 

Mr. FLORES. OK. It may have helped validate the solution? 

Mr. HORN. I don’t think so. 

Mr. FLORES. OK. You don’t think so? OK. 

And at that time, did you or anyone in VW of America have any 

knowledge of the alleged defeat device? 

Mr. HORN. At which point of time? 

Mr. FLORES. At the time, December of 2014—— 

Mr. HORN. No. 

Mr. FLORES [continuing]. When you were beginning to roll out 

the recall solution, did you have any knowledge of the—— 

Mr. HORN. No. 

Mr. FLORES. Anybody in VW America, to the best of your knowledge? 

Mr. HORN. To my understanding, not, because, otherwise, I 

would have hoped that they would inform me about this. 

Mr. FLORES. Thank you. I yield back. 

Mr. MURPHY. Thank you. 

I now recognize Ms. Clarke of New York for 5 minutes. 

Ms. CLARKE. Thank you, Mr. Chairman. 

And I would like to thank you, Mr. Horn, for taking the time and 

giving us as much background and as much knowledge of what has 

taken place, to the best of your ability. 

I have heard a couple of my colleagues on the other side of the 

aisle refer to what has occurred as cheating, but I would like to say 

to you that I believe it was an intentional deception. And I think 

we need to say it as it is. This wasn’t a game. This was an intentional deception to bring something on the market that did not 

meet standards. 

I want to go back to something my colleague just raised about 

your testing center at Oxnard. I understand that, for the better 

part of the past year, VW was interacting with CARB about discrepancies related to the high emissions that were discovered in 

2014 involving your vehicles. What is the purpose of the Oxnard 

facility? And is it, as the article suggests, developed to help Volkswagen meet emission standards? 

Mr. HORN. To my understanding, yes, and it’s directly connected 

to the Research and Development Department in Germany to help 

them to get the cars into legal compliance and to the U.S. standards. 

Ms. CLARKE. How many employees are there? 

Mr. HORN. Oh, I would have to guess this number. 

Ms. CLARKE. OK. If you could just provide us with that? 

Mr. HORN. Just everything—— 

50 

Ms. CLARKE. What was the role of the Oxnard facility in understanding the test results presented by CARB showing unexpectedly 

high on-road emissions? What was its role once it had that information? 

Mr. HORN. At this point of time, I can’t answer this. I don’t have 

the understanding. I only know that our Department in Auburn 

Hills was interfacing with CARB and EPA for the compliance, for 

the applications and everything. 

Ms. CLARKE. So, as you have mentioned Auburn Hills, what is 

the role of that office? 

Mr. HORN. Excuse me? 

Ms. CLARKE. What is the role of the Auburn Hills office? 

Mr. HORN. And to do the compliance and the application for certification with the U.S. authorities, and they work directly on a 

working level, on a management level, on a daily basis with EPA 

and CARB. 

Ms. CLARKE. And so, do the Oxnard and Auburn Hills facilities 

work together? 

Mr. HORN. Now, yes, there’s a structural change in terms of—— 

Ms. CLARKE. So, prior to the unveiling of this deception, they 

were separate entities? They didn’t interface? 

Mr. HORN. Well, I think they worked together. My explanation 

is about the structure of the situation of these facilities. And they 

are now under one roof. 

Ms. CLARKE. OK, but they collaborate? 

Mr. HORN. I hope so. 

Ms. CLARKE. They are collaborators? Because, you know, my concern is that, if we have these facilities designed specifically to address the issues of emissions, of testing, and they failed, that 

speaks to a whole other level of perhaps collusion with respect to 

this whole software debacle. 

Have you looked at or done any internal investigation with respect to these facilities? 

Mr. HORN. That’s part of the internal investigation, but my understanding is they’re just testing on the basis of the legal test requirements. 

Ms. CLARKE. So, the engineers would not have known software 

code? Is that what you are saying? 

Mr. HORN. I think that they have tested the dyno situation for 

the cars and they didn’t do independent road tests. That’s what I 

allude to. 

Ms. CLARKE. OK. Let me jump to the whole idea of the environmental impact. How seriously does Volkswagen take its commitment to the environmental responsibility? 

Mr. HORN. This is deeply—also, maybe it’s difficult to understand 

now in this context—but it is deeply embedded in our corporate 

culture. We have three values which is innovative, valuable, and 

responsible, and responsible towards our employees and the environment. 

Our plant in Tennessee is a Platinum LEED certification. This 

is the most clean and energy-efficient plant in the world. And all 

of our plants have a commitment to reduce carbon footprint by 25 

percent in 2018. And whether these plants are in India, newly 

built, or in China, they are always up really to the highest VolksVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00054 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
51 

wagen standards, which go beyond sometimes conventional standards. 

Ms. CLARKE. So, if this is part of the corporate culture—— 

Mr. HORN. Yes. 

Ms. CLARKE [continuing]. I am assuming that that is throughout, 

including your engineers and scientists, that this is sort of a part 

of the ethos. How do you explain this deviation, a massive deviation? 

Mr. HORN. Myself and the majority of all Volkswagen employees, 

which is 600,000, asked the same question, the same question, and 

it’s a relevant question. And I hope that these investigations will 

definitely find out what drove those people, beyond newspaper articles and what we read out there, what drove those people into 

these decisions, into these actions. 

Ms. CLARKE. Hope it won’t be profits. 

I yield back, Mr. Chairman. 

Mr. MURPHY. Mr. Tonko is recognized for 5 minutes. 

Mr. TONKO. Thank you, Mr. Chairman. 

Mr. Horn, these vehicles promised unrivaled fuel economy and 

performance without the NOx emissions usually associated with 

diesel. I know other members have asked about how Volkswagen 

intends to make consumers whole, and I do want to lend my voice 

to that briefly. 

Because consumers, including people in my district, purchased a 

car believing it would be a clean, environmentally friendly choice, 

they have every right to feel defrauded. Consumers were sold a bill 

of goods that simply does not exist. 

And I think it is likely that whatever fixes to comply with emissions standards will hurt the vehicles’ performance in other ways. 

This is not what consumers thought they were buying, and it is not 

what dealers thought they were selling. Worse still, the resell value 

on these vehicles, which I am sure was a selling point, has certainly been destroyed. So, Volkswagen has a lot to think about, I 

believe, in terms of how it intends to make right by consumers. 

Now let me ask, typically, when deciding whether to issue a recall and develop a solution, does Volkswagen conduct its own emissions testing? 

Mr. HORN. Yes. 

Mr. TONKO. And did you try to recreate or confirm the results of 

the ICCT study from May of 2014? 

Mr. HORN. I can’t speak to this, what they specifically tested. In 

July 2014, I was informed that they have basically acknowledged 

the testing results and were developing those fixes in order to bring 

those cars back into compliance. 

Mr. TONKO. Now a lot was said about defeat devices, and we are 

talking about a defeat device here. Has the Volkswagen operations 

been impacted by defeat devices in the past? 

Mr. HORN. I have, in the context after September 3rd, understood that there was an issue, for instance, here in 1974, yes. 

That’s what I understand. 

Mr. TONKO. And so, what measures were taken by the company 

to make certain that there was better scrutiny, better oversight of 

the potential for defeat device application? 

52 

Mr. HORN. At that point of time, that’s a great question, and I 

can’t get you the answer now. 

Mr. TONKO. But was something done? 

Mr. HORN. In 1974, I was 12 years old. I don’t know. 

Mr. TONKO. Well, history is history. We missed some of that. So, 

we reach to the books and read about it. What was done, if anything—— 

Mr. HORN. Yes. 

Mr. TONKO [continuing]. To address defeat device application? 

Mr. HORN. And I think the investigations will go back into this 

time and—— 

Mr. TONKO. Well, I don’t think we need to investigate that. Did 

a corporate measure get put into play to address defeat devices? 

Mr. HORN. Back then, I don’t know the answer, no, sir. 

Mr. TONKO. I would hope you could provide that to the committee. I am certain the record will be open. 

Mr. TONKO. And if I could just confirm some of the information 

we have received, Volkswagen initiated a voluntary recall in December of 2014 that was intended, in part, to address the issue of 

excess NOx emissions, is that correct? 

Mr. HORN. Excuse me. Could you repeat the question, please? 

Mr. TONKO. Right. Volkswagen initiated a voluntary recall—— 

Mr. HORN. Yes. 

Mr. TONKO [continuing]. In December of 2014? 

Mr. HORN. That’s correct, yes. 

Mr. TONKO. That’s correct? Who at Volkswagen proposed the recall? 

Mr. HORN. The Technical Engineering Department in conjunction 

with the Product Safety Committee worldwide, which is steering all 

the recalls campaigns and voluntary recall actions out of Wolfsburg 

essentially for all the markets. 

Mr. TONKO. And what explanation was given to consumers about 

why that December 2014 recall was necessary? 

Mr. HORN. I would have to look into the document on what we 

wrote to those consumers. I don’t know now. 

Mr. TONKO. You will provide that to the committee, please? 

Mr. HORN. Definitely. It’s public. It’s public anyhow. 

Mr. TONKO. And what explanation was given to regulators about 

why that December 2014 recall was necessary? 

Mr. HORN. That’s also something we will have to provide in the 

document, with the documents. 

Mr. TONKO. And what fix did the Volkswagen organization implement for cars brought in under that recall? 

Mr. HORN. All have been software fixes. New software versions 

have been fleshed into the specific onboard steering units. 

Mr. TONKO. And who at Volkswagen developed that fix? 

Mr. HORN. The Engine and Drivetrain Development, Software 

After-Treatment Departments in Germany, Wolfsburg. 

Mr. TONKO. And did they know at the time that it would not 

work? 

Mr. HORN. I don’t know that. My understanding was that it 

would work and, otherwise, also the work by the Product Safety 

Committee wouldn’t have released this version for application in 

the markets. 

53 

Mr. TONKO. Well, I thank you for your responses. I look forward 

to the additional information you owe to the committee. 

And again, I would say on behalf of the consumers of the 20th 

Congressional District of New York, those of the country, and 

around the world impacted by this, they deserve a sound explanation and a fix that will respond to the environmental damage 

done here and the consumer fraud. 

Mr. HORN. Yes, sir. Thank you. 

Mr. MURPHY. Thank you. 

Ms. DeGette has one final question real quick, and then, we have 

got to leave. 

Ms. DEGETTE. First, Mr. Chairman, I ask unanimous consent to 

put Mr. Welch’s document into the record. 

Mr. MURPHY. So ordered. 

Ms. DEGETTE. I just have oen last question, Mr. Horn, because 

you told a whole bunch of us on this committee that, after that 

West Virginia University study in May of 2014, everybody was running around trying to figure out what was going on with these cars 

and why there was a discrepancy between the tasks, that your engineers didn’t know the answer. But, in fact, the discrepancy was 

because of a willful act of some engineers in Germany in the first 

place, correct? 

Mr. HORN. That’s my understanding, yes. 

Ms. DEGETTE. And those people, that information about that discrepancy never made it to Germany, so they could tell your people 

what was wrong? Is that what you are testifying to here today? 

Mr. HORN. I don’t understand what you’re trying to say. 

Ms. DEGETTE. Well, you said your people were trying to figure 

out why there was a discrepancy. 

Mr. HORN. Right. 

Ms. DEGETTE. But there were some people who knew, and those 

were the people who wrote that deceptive code in the first place. 

Are you telling me that they never told your U.S. people what the 

problem was and why there was a discrepancy? 

Mr. HORN. The people who investigated the study in detail and 

developed those software fixes were also the colleagues in Germany. Of course, they were informing their U.S. colleagues in Auburn Hills. 

Ms. DEGETTE. So, did they tell the U.S. colleagues that there was 

this deceptive code and that was what was causing the discrepancy, yes or no? 

Mr. HORN. I don’t think so. I don’t think so. 

Ms. DEGETTE. Thank you. 

Mr. HORN. Otherwise, we would be much earlier here. 

Mr. MURPHY. Thank you. 

Mr. Horn, that concludes our questioning for now. This hearing 

is not over, but we would appreciate—more questions will be coming from committee members—we would appreciate a quick and 

honest response to those as well. 

Mr. MURPHY. This hearing is going to adjourn for a couple of 

hours while the Republican Conference is meeting. We will reconvene about 15 minutes after the call of the Chair after that meeting. 

Thank you much. We will be back. 

54 

Mr. HORN. Thank you. 

Mr. MURPHY. And thank you. 

[Whereupon, at 12:18 p.m., the subcommittee recessed, to reconvene at 1:39 p.m. the same day.] 

Mr. MURPHY. All right, we reconvene this Subcommittee on Oversight and Investigations hearing on Volkswagen’s Emissions Cheating Allegations: Initial Questions. 

We have Mr. Grundler and Mr. Brooks here as witnesses. 

And let me just go into this, as we reconvene this hearing. 

You are aware that the committee is holding an investigative 

hearing, and when doing so, has the practice of taking testimony 

under oath. Do you have any objections to testifying under oath? 

Mr. BROOKS. No. 

Mr. GRUNDLER. No. 

Mr. MURPHY. Both witnesses say no. 

The Chair then advises you that, under the rules of the House 

and the rules of the committee, you are entitled to be advised by 

counsel. Do either of you desire to be advised by counsel during 

your testimony today? 

Mr. BROOKS. No. 

Mr. GRUNDLER. No. 

Mr. MURPHY. Both witnesses indicate no. 

In that case, would you please rise and raise your right hand, 

and I will swear you in? 

[Witnesses sworn.] 

Mr. MURPHY. Thank you. 

For the record, both witnesses have indicated yes. You are now 

under oath and subject to the penalties set forth in Title 18, Section 1001, of the United States Code. 

We will now allow you each to give a 5-minute summary of your 

opening statement. 

Mr. Grundler, you may begin. 

STATEMENT OF CHRISTOPHER GRUNDLER, DIRECTOR, OFFICE OF TRANSPORTATION AND AIR QUALITY, OFFICE OF 

AIR AND RADIATION, ENVIRONMENTAL PROTECTION AGENCY, ACCOMPANIED BY PHILLIP BROOKS, DIRECTOR, OFFICE 

OF CIVIL ENFORCEMENT, AIR ENFORCEMENT DIVISION, OFFICE OF ENFORCEMENT AND COMPLIANCE ASSURANCE, ENVIRONMENTAL PROTECTION AGENCY 

Mr. GRUNDLER. Chairman Murphy, Ranking Member DeGette, 

and other members of the subcommittee, we appreciate the opportunity to testify on the matter of the Environmental Protection 

Agency’s Notice of Violation issued to Volkswagen. 

I am Chris Grundler and I direct the EPA’s Office of Transportation and Air Quality, which is responsible for EPA’s Air Pollution 

Compliance Program for all mobile sources, vehicles, engines, and 

equipment, including cars, trucks, and fuels. 

I am joined today by my colleague Phil Brooks, Director of the 

Office of Civil Enforcement’s Air Enforcement Division. EPA’s Civil 

Enforcement Program develops and prosecutes civil administrative 

and judicial cases. 

On September 18th, 2015, EPA sent a Notice of Violation, an 

NOV, of the Clean Air Act to Volkswagen, including Volkswagen 

55 

AG, Audi AG, and Volkswagen Group of America, Inc., alleging 

that four-cylinder Volkswagen and Audi diesel cars sold in the U.S. 

for model years 2009 to 2015 include software that circumvents 

EPA’s emissions standards. Volkswagen manufactured and installed software in the electronic control module of these vehicles 

that sensed when the vehicle was being tested for compliance with 

EPA emissions standards. Put simply, these cars contain software 

that turns off or significantly reduces the effectiveness of emissions 

controls when driving normally and turns them on when the car 

is undergoing an official emissions test. 

This is known as a defeat device. This design feature results in 

the cars emitting up to 40 times the emissions that are allowed to 

ensure public health is protected. These devices contain essentially 

a switch that senses whether the vehicle is being tested or not 

based on various inputs, including the position of the steering 

wheel, vehicle speed, the duration of the engine’s operation, and 

barometric pressure. The NOV that EPA issued covers roughly 

482,000 diesel cars. 

All new cars sold in the United States must have an EPA-issued 

Certificate of Conformity demonstrating that the car meets applicable Federal emissions standards to control air pollution. By making 

and selling vehicles with defeat devices that allow for higher levels 

of air emissions than were certified to EPA, VW violated multiple 

important Clean Air Act provisions. These violations are very serious not only because the illegal defeat device results in excess 

emissions many times the allowable standard, but also because, 

after the high emissions were discovered, VW concealed the facts 

from EPA, the State of California, and from consumers. 

These vehicles are emitting more nitrogen oxides, or NOx, than 

regulations allow. NOx pollution contributes to ground-level ozone 

and particulate matter. We know that exposure to these pollutants 

has been linked with a range of serious health effects, including increased asthma attacks and other respiratory illnesses that can be 

serious enough to send people to the hospital. 

We are in the midst of an ongoing investigation into VW’s actions. We will be working closely with the U.S. Department of Justice throughout this investigation, and determinations regarding 

potential penalties and other remedies will be assessed as part of 

the investigation. However, at this point we are unable to provide 

further details of the investigation because the release of such information could jeopardize this ongoing enforcement investigation. 

EPA will continue to work closely with the California Air Resources Board during the investigation. CARB led and contributed 

much of the effort to get us to this point. Our agencies work very 

closely together on the implementation and oversight of the Vehicle 

Emissions Programs. 

As part of the investigation, we intend to assess the scope of 

VW’s liability under the Clean Air Act and whether there are additional vehicles with defeat devices. We also intend to assess the 

economic benefit to VW of noncompliance and pursue appropriate 

penalties, as well as to assess the excess pollution from VW’s violations and the appropriate ways to mitigate them. 

While our enforcement authority concerns air pollution, we are 

acutely aware of the impact of these violations on consumers, and 

56 

we have provided frequently asked questions and answers for consumers on our Web site, such as whether the cars are safe to drive 

and whether EPA is officially recalling the vehicles at this point. 

On September 25th, my office sent a letter to all auto manufacturers notifying them that we are stepping up our testing activities 

in response to these alleged violations. Over the 40-plus-year history of our program, we have continuously updated and adapted 

our approaches to compliance oversight as technologies and situations have changed. We take very seriously our responsibility to 

oversee the implementation and enforcement of our regulations. 

It is this oversight that ensures the benefits of clean air emissions standards are realized and that the industry is competing on 

a level playing field, and that consumers are getting what they pay 

for. 

Again, thank you for the opportunity to appear as witnesses this 

morning. We welcome your questions. 

[The prepared statement of Mr. Grundler and Mr. Brooks follows:] 

57 

58 

59 

60 

Mr. MURPHY. Thank you. 

Mr. Brooks, you don’t have a statement? You issued a joint statement, correct? 

Mr. BROOKS. That is correct. 

Mr. MURPHY. OK. Thank you. 

Now I am going to recognize myself for 5 minutes. 

When you speak, just make sure you turn the mic on and bring 

it as close to your mouth as possible. 

So, Mr. Grundler, in December of 2014, VW conducted a voluntary recall to address the on-road emissions, as you know. What 

information did VW convey to you about the cause and the proposed solution for the higher emissions in advance of that recall? 

Mr. GRUNDLER. Thank you, Mr. Chairman. 

Throughout 2014, once California and EPA learned of these excess emissions, there were numerous technical conversations between the California Air Resources Board and Volkswagen. California took the lead on exploring what the problem was with these 

vehicles, and my understanding is that they received multiple different stories, plausible reasons why these vehicles may not be performing as they are supposed to, chemical-based reasons, physicalbased reasons. 

At the end, the remedy that was proposed was described to fix 

a problem with the vehicle concerning how it is operated under different temperatures, what kind of dosing sensors were used to 

make the emissions control system work properly, and that they 

were confident in the fix. 

At the time, they were told by the State of California to proceed, 

but that California was going to test these vehicles to make sure 

that the fix was effective. And it was not effective, based on the 

subsequent testing by the California Air Resources Board. 

Mr. MURPHY. Thank you. 

Did you conduct any further evaluation of their conclusions and 

proposed solutions in advance of the recall? So, what was the operational process you had in interacting with them, discussions/conversations that go back and forth? 

Mr. GRUNDLER. So, EPA and California have a very strong partnership when it comes to oversight and compliance. Sometimes 

California takes the lead on these matters. Sometimes EPA takes 

the lead on these matters. For example, last year we had the lead 

with respect to the Hyundai/Kia investigation and subsequent action. California volunteered to take the lead on this matter. 

And what happened during 2014 is essentially what is happening 

right now as we speak, which is trying to determine what is the 

right recall solution to address these excess emissions. It was VW’s 

responsibility to identify what was wrong and to propose a fix. 

They did so. That fix did not work. 

So, most of these interactions were between California and the 

company. EPA, my team, participated in some of them. We became 

much more actively involved in 2015, when California produced 

their test results on the supposed fix of these vehicles and that 

data showed that there still remained very high and unexplained 

excess emissions. 

Mr. MURPHY. Who did you have these conversations with, with 

VW, going back and forth, communicating while they are working 

61 

or they are talking to you about these results? Do you recall who 

that was? 

Mr. GRUNDLER. So, I want to be clear. I was not part of those 

conversations. It was my team and the California counterparts. My 

understanding is those conversations included both officials from 

VW of America as well as officials from Germany. 

Mr. MURPHY. Do you know their names for the record? 

Mr. GRUNDLER. I do not. 

Mr. MURPHY. Can you identify those? Are those things you could 

get for us? 

Mr. GRUNDLER. Yes. 

Mr. MURPHY. Would you please do so? That would be important. 

Mr. MURPHY. Now I have a technical question. I am not sure if 

either of you can answer this. So, here is this switch that, when 

it is in one position for an emissions test, it made a change in how 

this was operational, so the emissions would be lower. In the other 

position, the emissions were quite high. Is it possible to just keep 

that switch in the position of low emissions, and then, they could 

be in compliance or does that damage the engine or reduce power 

significantly? Do you have any idea? 

Mr. GRUNDLER. Well, those are exactly the same kind of questions we are asking Volkswagen right now. It’s not actually a 

switch, sir. It is what we call a dual-calibration strategy. So, the 

vehicle is programmed to work two different ways. And when the 

vehicle senses when it’s on a test, it very quickly goes into clean 

mode, and when it does not sense the very specific parameters that 

are specified in our Federal test procedures, it goes into a high-pollution mode. 

So, I think what you’re asking is—— 

Mr. MURPHY. Yes, that’s what we—— 

Mr. GRUNDLER [continuing]. Can you just take this software and 

will the vehicle operate normally? And we don’t know yet. We’re 

asking those questions. And the answers will depend, as you heard 

this morning, on which generation of diesel engines we’re talking 

about. We believe that the newer generation, the so-called Generation 3 engines, will be much easier to fix than the older versions. 

Mr. MURPHY. Thank you. I am out of time now. 

Ms. DeGette, 5 minutes. 

Ms. DEGETTE. Thanks. 

Just to continue along, the newer versions, they have these Urea 

Tanks. 

Mr. GRUNDLER. Right. 

Ms. DEGETTE. And so, it is a system that you can both adjust 

the NOx filters and the Urea Tanks? And in fact, the VW dealer, 

the dealer in Denver and also their mechanics told me they feel 

like it would be a pretty easy adjustment, even just in the codes, 

to fix it in the 2015 and 2016 models. Is that your understanding, 

Mr. Grundler? 

Mr. GRUNDLER. I don’t want to speculate that. 

Ms. DEGETTE. Yes. 

Mr. GRUNDLER. That seems logical to us. 

Ms. DEGETTE. Right. 

Mr. GRUNDLER. We want to see the software. We want to test the 

vehicle before—— 

62 

Ms. DEGETTE. Obviously, yes. 

Mr. GRUNDLER [continuing]. Any further action is taken. 

Ms. DEGETTE. Yes, obviously. 

Mr. GRUNDLER. You can imagine that we’re skeptical. 

Ms. DEGETTE. But it is the agency’s position that these vehicles 

do need to be fixed, right? 

Mr. GRUNDLER. Absolutely. 

Ms. DEGETTE. I mean, they are noncompliant under both Federal 

law and California State law? 

Mr. GRUNDLER. That is correct. 

Ms. DEGETTE. You know, I think some of the impressions given 

by Volkswagen is, well, you know, they are safe to drive. They 

might be safe to drive, but they don’t comply with the emissions 

standards, right? 

Mr. GRUNDLER. That’s right. 

Ms. DEGETTE. So, for the cars between 2009 and 2014, the fix 

is a bigger problem because they don’t have the Urea Containers. 

And so, it is harder to see how, without major structural changes 

to these cars, how they could be brought into compliance? Is that 

your understanding? 

Mr. GRUNDLER. That is correct. They will require a more substantial engineering solution. 

Ms. DEGETTE. They are either going to require installation of a 

Urea System or different NOx filters or both. So, that is going to 

be quite elaborate. I am not a mechanic, and I don’t pretend to be 

one, but I went over and looked at this. And it looked like a very 

knotty problem to me. 

Mr. GRUNDLER. What California and EPA have directed Volkswagen to do is to present more than one option on how to address 

these excess emissions. And we want to look at these options very 

carefully, particularly with respect to what impacts they will have 

on the owners. 

Ms. DEGETTE. Right. And have you given VW any kind of a 

deadline for coming up with that fix or have they indicated to you 

when they might be able to come up with this? This is something 

that really concerned the panel in the earlier conversations today. 

Mr. GRUNDLER. I can assure you we have a very strong sense of 

urgency. We are pressing Volkswagen for that plan and for those 

solutions. We’re meeting with them on practically a daily basis. We 

hope to get a proposal very, very soon. But we want to make sure 

that it’s effective. So, there’s some risk in rushing, but we expect 

to see something as early as next week with respect to the Generation 2 vehicles. 

Ms. DEGETTE. And has the company told you that they believe 

they can fix the affected vehicles without affecting fuel economy, 

engine performance, or both? 

Mr. GRUNDLER. They have not said so. 

Ms. DEGETTE. OK. So, I just want to say one last thing, which 

is oftentimes we have the EPA in here, and sometimes it is not the 

most pleasurable experience testifying. But in this case the Director of the International Council on Clean Transportation, which 

was the organization that commissioned the West Virginia study, 

said, quote, ‘‘This is a powerful affirmation of U.S. Federal and 

California vehicle emissions regulations and of the agencies. Clear 

63 

protocols, in-use requirements for the useful life of vehicles, clear 

enforcement follow-through, the authority to fine and force recalls, 

these are the best practices that regulations worldwide should incorporate, and today’s announcement shows why.’’ End quote. 

So, thank you and your agency for your efforts here. 

I want to ask you, Mr. Grundler, in light of VW’s deception, are 

you adjusting testing going forward? 

Mr. GRUNDLER. Yes, and we already have. 

Ms. DEGETTE. And what have you done? 

Mr. GRUNDLER. Well, we have learned from this episode for sure. 

We wish we had found it sooner. As soon as we learned of this 

data, CARB and EPA focused—— 

Ms. DEGETTE. So, how are you adjusting the testing going forward? 

Mr. GRUNDLER. The bottom line, madam, is that we are going to 

be unpredictable. What is required for a robust compliance and 

oversight program is both testing of new vehicles in the lab, testing 

of what we call in-use vehicles in the lab as on-road measurements. 

Ms. DEGETTE. Thanks. I don’t have much time. 

Mr. Brooks, are you adjusting enforcement efforts going forward 

and, if so, how? 

Mr. BROOKS. Thank you for the question. The answer is yes, although I think the prosecution, the investigation of this matter will 

proceed along our normal path. I think what we will see is we will 

be getting a lot more phone calls from people. And so, in that way, 

it will change. We will have more to respond to. 

Ms. DEGETTE. Thank you. 

Thank you very much, Mr. Chairman. 

Mr. MURPHY. I think Mr. Griffith is next. Mr. Griffith, you are 

next for 5 minutes. 

Mr. GRIFFITH. Thank you very much, Mr. Chairman. 

And I appreciate you all being here and appreciate the questions 

that have already been asked. 

Obviously, there are a number of us, if you were listening to the 

previous testimony, you know I am one of the people who owns one 

of the diesel Volkswagens. And so, I have some questions in that 

regard. 

I think it is important that you change your testing methods. 

The first question I am going to ask you is, do you think it might 

be helpful in doing your job if we passed some legislation that 

would allow a portion of the fine money in a fraud case like this 

to go to the university that discovered it? I mean, WVU discovered 

the problem. You all didn’t. 

Believe it or not, I don’t think the EPA can and should do everything, and that this might be of some assistance. Just like we do 

with certain bad actors in other criminal-type settings who are 

committing fraud on consumers or selling drugs, we take some of 

their ill-gained goods. We take it away from them, and the Government gives it back to some of the folks who helped discover it, law 

enforcement and prosecutors. Do you think that might be a helpful 

piece of legislation for us to take a look at? Either one of you, or 

both. 

64 

Mr. BROOKS. Well, I don’t think I could comment on what legislative changes might be necessary. I do understand that in the criminal context those kinds of remedies have been imposed before. 

Mr. GRIFFITH. So, the question is, if you have that power now, 

please tell us. 

Mr. MURPHY. Excuse me one second. 

Could you speak close to the mic? None of us can hear you. You 

are going to have to sit forward and into the mic. 

Mr. GRIFFITH. If you currently have that power, then let me 

know that. But, if you don’t have that power, in other words, whenever you come up with the fine that is appropriate for Volkswagen, 

it would seem to me—and I don’t know that you have that authority now—to give WVU, West Virginia University, that uncovered 

this problem part of the fine to help them continue their research. 

I mean, that is what we do with prosecutors. We do that with law 

enforcement agencies who uncover crime. We do that in some securities cases. There are different ways that is done. 

Do you all think that would be an authority that would be helpful for the people of the United States of America? 

Mr. BROOKS. Well, I can take that back and we can respond in 

writing. 

Mr. GRIFFITH. All right. 

Mr. GRIFFITH. It sounds like a good idea to me, I will just tell 

you. 

It is interesting that WVU found it and that you all did not, but 

I understand you can’t do everything. And you have answered some 

questions about how you are going to go forward. 

Let’s go to the other side of this. Now I will, whatever you all 

come up with and whatever Volkswagen comes up with, I will get 

my car fixed. Or, if they do a buy-back program, I will have to debate whether it is better to fix it or to sell it back to the company 

because it is not doing what it is supposed to. 

But I am just curious, at some point—and right now, I understand you are not doing that right now—but, at some point, am I 

going to be subject, or other consumers in my shoes, are they going 

to be subject, to penalties from the EPA for driving a vehicle that 

doesn’t meet the standards that were supposed to be in place when 

they bought the vehicle? 

Mr. GRUNDLER. That question depends on where the particular 

owner of a Volkswagen, of one of these vehicles, lives. If you live 

in an area that does regular emissions tests, that the State conducts these inspections, emissions inspections, some States require 

that, in order to re-register the vehicle, if it is subject to a recall, 

to show that the fix has been made. Other States do not have that 

requirement. It depends on where you’re living. 

Mr. GRIFFITH. OK. So, for some people who may not be paying 

attention to whatever notices they might get or, for whatever reason, aren’t following the news—and believe it or not, there’s a 

whole bunch of those folks out there who don’t follow day-to-day 

news—they could actually end up with some kind of a penalty from 

their State. But, currently, there is nothing nationally? 

Mr. GRUNDLER. That’s right. 

Mr. GRIFFITH. Would you anticipate that the EPA would go in 

the direction of some kind of a national program if enough of the 

65 

cars did not get bought back or fixed after a certain number of 

months? 

Mr. GRUNDLER. We certainly will be encouraging consumers 

to—— 

Mr. GRIFFITH. I understand that. You are going to get the word 

out as best you can? 

Mr. GRUNDLER. That’s right, but—— 

Mr. GRIFFITH. But they don’t get the message. There’s still a million cars, or 100,000 cars, I think. 

Mr. GRUNDLER. I would not anticipate—— 

Mr. GRIFFITH. You would not anticipate that? 

Mr. GRUNDLER [continuing]. EPA going after individuals. 

Mr. GRIFFITH. But it is a possibility? 

Mr. GRUNDLER. I don’t think that’s a possibility under the Clean 

Air Act. 

Mr. GRIFFITH. Because let me tell you one of my concerns is— 

and it doesn’t have anything to do with you all, and it is a rhetorical question, so you don’t have to answer it. I will tell you that 

upfront. But yesterday we had an EPA official in and we were talking about the Clean Power Plan and the cap-and-trade scheme, 

which they didn’t call it the cap-and-trade scheme, they kept resisting that. But it talks about putting a limit on emissions and, then, 

being able to make trades. So, it sounds like cap-and-trade. 

And what was interesting about it was that I had a list of quotes 

from Lisa Jackson in 2011, Gina McCarthy 2011, Gina McCarthy 

2013, Gina McCarthy 2014, that said they were never going to consider—and, in fact, it wasn’t allowed under the law—to do a capand-trade scheme. And then, I am looking at some cap-and-trade 

scheme. 

So, I am a little concerned, not for me. I am going to do what 

I need to do to make my car right or get rid of it. But there are 

going to be a lot of folks out there who may be caught, and I just 

want to make sure that the EPA isn’t doubling down on their damages, because every one of us that bought one of these vehicles is 

damaged in some form or another. 

So, I appreciate you listening to that. If you want to answer, I 

will give you a chance to answer. Mr. Brooks looks like he wants 

to answer. 

Mr. BROOKS. I will assure you that I am aware of absolutely no 

provision of the Clean Air Act which would allow a prosecution for 

the things that you are talking about. 

Mr. GRIFFITH. And that is exactly what Lisa Jackson told us 2 

or 3 years ago, but that is OK. We will move on. 

You know, last but not least—— 

Mr. BROOKS. I’ll say it won’t happen. 

Mr. GRIFFITH. Yes. On Gen 1 cars, I have read somewhere that 

it is going to take—it is a more complicated fix, we heard this 

morning, but it is also going to take up some of the space probably 

in the trunk area of the vehicle. Have you all heard that? 

Mr. GRUNDLER. Sir, that would depend completely on what the 

remedy would be. And as I said earlier, we are going to take a very 

careful look at what impact this is going to have on owners and 

consumers. That will be central to how we review the options that 

Volkswagen comes forward with. So, we don’t know that yet. 

66 

Mr. GRIFFITH. All right. I appreciate it very much. Thank you all 

for being here. 

I yield back. 

Mr. MURPHY. The gentleman yields back, and I recognize Mr. 

Pallone for 5 minutes. 

Mr. PALLONE. Thank you. 

Mr. Grundler, one of the concerns that I raised with Mr. Horn 

earlier was this concern about whether we might find these defeat 

devices or similar problems with other cars. So, I wanted to ask the 

question, do you have the tools and authority you need to ensure 

there are no other cheaters out there? 

Mr. GRUNDLER. Yes, we do. 

Mr. PALLONE. But I am also concerned about—and maybe this is 

for Mr. Brooks—about the comments that Mr. Horn made where he 

suggested, you know, there were a couple of rogue engineers that 

may have done this, but suggested that there was no corporate responsibility. 

Is it the EPA or is it the AG? Who goes after the individuals, corporate or otherwise, that might be responsible for this? Or do you 

at some point envision even bringing charges, you know, like criminal charges against the corporation itself for this intentional deceit? 

Mr. BROOKS. Thank you for the question. I can’t speculate now 

as to exactly what course all the enforcement actions will take. I 

can tell you that my office has already taken the initial enforcement action, and I can tell you that we are working with the Department of Justice on these matters. 

Mr. PALLONE. But I guess what I am asking—and I won’t keep 

repeating, but one more time—you know, we keep talking about 

the fines because of what happened. But does this rise to individual 

responsibility for those responsible? And is there such a thing as 

criminal action against the corporation? I mean, I know I am speculating, but are those possibilities? 

Mr. BROOKS. Let me be careful in answering that. First of all, I 

think that the concern that has been expressed here by Members 

is exactly our concern: Who, what, when, where, why, how? And so, 

I’m quite certain that the investigations that are ongoing and that 

will be begun will get into exactly that. 

I think it would be unfair for me to say much more about what 

the end result might be. 

Mr. PALLONE. But it is a possibility? 

Mr. BROOKS. Certainly it is a possibility. 

Mr. PALLONE. OK. You know, I was glad that Mr. Horn actually 

said that he understood the impact of these emissions, and they 

could have health and safety impacts. I mean, he did say that. 

But does it go beyond that? I mean, in other words, you know, 

he is admitting that this took place and that there could be some 

health and safety impacts because of the increased emissions. How 

does the EPA hold Volkswagen responsible for the environmental 

effects of their decision to evade emissions standards? In other 

words, does the EPA consider, is it possible that they could be held 

responsible for the impact on essentially dirtier air, not just fix the 

cars, but that there might be some damages or some kind of payVerDate Mar 15 2010 09:24 May 31, 2016 Jkt 037690 PO 00000 Frm 00070 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X85VWCHEATINGNEWQFRRMAYBE052616\114X85VWCHEAT
67 

ment that would have to be made because the air was made dirtier 

or that people’s health and safety were impacted? 

Mr. BROOKS. Thank you for that question. The answer to that is 

yes. While it may go by different names, we tend to talk about it 

in terms of mitigation, but the concept there is exactly what you 

articulated. We’re looking for the opportunities, the ways in which 

the damage that has been done to the environment, and which consequently has impacts on public health, can be addressed. 

Obviously, we can’t go back in time and take that pollution back 

out of the air, but many of our settlements look forward and ask 

the question, how is it that we can make air quality better than 

what the law minimally requires in any given instance? And that 

additional reduction in pollution is what we refer to as mitigation, 

and we have many, many consent decrees that go about doing that 

in many different ways. 

Mr. PALLONE. So, for example, you could impose some penalties 

that might be used to mitigate air pollution in other ways possibly, 

not by VW, but, you know, that the EPA would use that money 

somehow to mitigate air pollution in some other way? Just give me 

an example, and then, I will stop asking, because my time is almost up anyway. 

Mr. BROOKS. OK. A lot of the power plant cases we have had 

projects, for example, where the company has had to go out and 

find a third party to implement a wood stove changeout program, 

so that cleaner burning stoves, more efficient wood stoves are substituted for dirtier stoves. And that has a direct impact on air quality in communities because there are lots of communities out there, 

as I’m sure you know, that rely very heavily on wood-burning devices. So, that’s one example. 

Mr. PALLONE. All right. Thank you very much. 

Thank you, Mr. Chairman. 

Mr. MURPHY. The gentleman yields back. 

I recognize Dr. Burgess for 5 minutes. 

Mr. BURGESS. Thank you, Mr. Chairman, and I apologize for 

being out of the room for part of the hearing. So, I am going to ask 

a couple of questions. If they have been asked before, please bear 

with me and try to give an answer that is consistent with how you 

answered previously. 

First off, what is the budget for the EPA currently? 

Mr. GRUNDLER. I don’t have the budget for the entire EPA. I can 

give you the budget for my organization. 

Mr. BURGESS. Sure, we will take that. 

Mr. GRUNDLER. So, it’s roughly $100 million a year and 340 fulltime people that work in my organization. 

Mr. BURGESS. The overall budget for the EPA—and I am just relying on memory, which is dangerous—but I think it is close to $15 

billion. So, the EPA has resources available. It has funding available. 

Mr. GRUNDLER. I do want to correct that. I think EPA’s budget 

is around $7 billion and about 15,000 people, roughly. 

Mr. BURGESS. Nevertheless, West Virginia University had a 

budget for this research project, my understanding is, around $50, 

$60, $70 thousand, is that correct? 

68 

Mr. GRUNDLER. We are extraordinarily grateful for the work that 

West Virginia University and the ICCT did. And I am not going to 

blame our budget for the fact that we missed this cheating. 

I do think we do a very good job of setting priorities at EPA. 

Once we learned of these excess emissions, we focused on it. We 

didn’t ignore it. And then, we have also immediately changed how 

we are doing our testing regime to be more unpredictable, so this 

doesn’t happen again in the future. 

Mr. BURGESS. Well, with all due respect, just looking at the situation, I think the American people ought to ask that we fire you 

and hire West Virginia University to do our work. They certainly 

are much more cost-effective than this part of the Federal agency. 

Let me ask you this: I sit on another subcommittee. We have jurisdiction over the National Highway Traffic Safety Administration. 

So, I am familiar with safety recalls, but we heard Mr. Horn testify 

earlier today that this is not a safety issue with these cars as they 

are driven. There are emissions issues, but there are not safety 

issues. Is that correct? 

Mr. GRUNDLER. That’s correct. 

Mr. BURGESS. So, does EPA do its own kind of recall that is separate and apart from the National Highway Traffic Safety Administration? 

Mr. GRUNDLER. We do. 

Mr. BURGESS. And would this be www.recalls.gov that is the Web 

site that consumers can go to, to find out information about the recall or the possible recall on their vehicle? 

Mr. GRUNDLER. We have not ordered a recall yet. When we do, 

we will provide that information for sure. 

Mr. BURGESS. That information will be on your Web site? 

Mr. GRUNDLER. Yes. 

Mr. BURGESS. So, I went to the Web site. In truthfulness, staff 

went to the Web site. They printed it off for me. I am very grateful 

for that. 

You can get information about pesticides, pesticide Web sites, 

EPA emissions recalls where I assume this would fall. Is that correct? 

Mr. GRUNDLER. Yes. 

Mr. BURGESS. When you click on that link, you get a ‘‘Page not 

found. Website improvements underway.’’ So, can you let consumers know when they are likely to be able to get that information off of your Web site? 

Mr. GRUNDLER. Again, sir, we have not ordered a recall. So, 

there is no recall information. We have information on our Web site 

that talks about our Notice of Violation, what vehicles are covered, 

and what consumers need to know today, which is that they can 

drive these cars. These cars are safe to drive. They will not be held 

responsible for any repairs. That would be the responsibility of the 

company. 

Mr. BURGESS. Let me ask you this because Mr. Pallone was asking you things about payment and damages, and because of the 

issue that the air was dirtier and health and safety have been impacted. So, it is, in all likelihood, Volkswagen of America is going 

to face some significant fines and penalties by the Environmental 

Protection Agency, are they not? 

69 

Mr. GRUNDLER. I think that’s very likely. 

Mr. BURGESS. And you heard my admonition to the CEO of 

Volkswagen of America: ‘‘Don’t be dismissive. Don’t run from the 

fact that this has happened. You need to be aggressively compliant.’’ And I hope they will be. 

But I have got to tell you, this summer I went to Silverton, Colorado, on my own dime and looked at what had happened to the 

Animas River, went to the Gold King Mine. And that was entirely 

created and caused by the Environmental Protection Agency. 

So, I have had a lot of people ask me that, if a private company 

had done that and turned the Animas River yellow, they would be 

held—the same thing we are talking about here—there would be 

fines, there would be mitigation costs. Does the EPA hold itself to 

the same standard to which it holds private corporations and, if 

not, why not? 

Mr. GRUNDLER. Are you asking me to testify about the Gold King 

Mine situation? 

Mr. BURGESS. Just in general. The EPA causes a problem. 

Should they be held to the same standards? And, no, I am not asking you to testify. 

In fact, Mr. Chairman, I think we should have a hearing on that 

as a separate issue. 

But just answer the question. Should EPA be held to the same 

standards to which you are going to hold a private corporation? 

Mr. GRUNDLER. All I can say, sir, because I’m not familiar with 

all the details, is I certainly have seen and read that the Administrator has taken full responsibility for that situation and we’re acting accordingly. 

Mr. BURGESS. It looked like a scene out of ‘‘Ghostbusters.’’ I will 

just tell you that. 

Thank you, Mr. Chairman. I will yield back. 

Mr. MURPHY. I do want to acknowledge that the gentleman from 

Virginia and the gentleman from Texas are both touting my neighboring State, West Virginia University, a rival of Pitt, but it is nice 

to see them get the accolades for doing such good work. 

I now recognize Ms. Castor for 5 minutes. 

Ms. CASTOR. Thank you, Mr. Chairman. 

Gentlemen, on September 18th, the EPA issued a Notice of Violation against Volkswagen. The notice alleges that certain Volkswagen and Audi diesel cars for model years 2009 to 2015 include 

software that circumvents EPA emissions standards for certain air 

pollutants. According to EPA, the software produced by Volkswagen is a defeat device, as defined by the Clean Air Act. 

Mr. Grundler, I understand that VW admitted in August to installing defeat devices on their vehicles. That is correct? Correct? 

It is accurate? 

Mr. GRUNDLER. I would describe it in mid-to-late August, California and we got a heads-up that they had, in fact, installed a defeat device, and we were officially notified on September 3rd. 

Ms. CASTOR. From Volkswagen? 

Mr. GRUNDLER. Correct. 

Ms. CASTOR. And what specifically did VW tell EPA they had 

done to the engines to circumvent emissions standards? 

70 

Mr. GRUNDLER. We were informed that the vehicles had a dualcalibration strategy on their engine control units which allowed the 

vehicle to operate one way when it sensed it was being tested by 

the EPA and in a completely different way when the vehicle was 

on the road. 

Ms. CASTOR. And has VW provided EPA with an engine map that 

shows specifically how the defeat device works for each model car 

in which it was installed? 

Mr. GRUNDLER. That is my understanding, but I would like to 

double-check that for you. 

Ms. CASTOR. OK. I understand the affected vehicles fall into 

three generations based on the model and the year. The defeat devices may work differently for each of these generations of vehicles. 

Mr. Grundler, at this point, does the EPA have a full understanding of how the defeat devices work in each of these generations of vehicles? 

Mr. GRUNDLER. We do not. We still have many questions for 

Volkswagen to answer. 

Ms. CASTOR. OK. So, what else do you need and has VW been 

helpful? What else do they need to provide EPA to give you the information that you need? 

Mr. GRUNDLER. The information that we’re focused on now like 

a laser is what are they going to do to address these excess emissions and take this software off these vehicles, so that they comply. 

We don’t need to know specifically how they cheated with each line 

of code. We have got some information on that, but I think the 

most important thing going forward is that those defeat devices are 

removed, that these vehicles are addressed in a way that will work 

for consumers and the environment. 

Ms. CASTOR. But you have said you have learned some lessons 

here. 

Mr. GRUNDLER. We have. 

Ms. CASTOR. Does EPA have the expertise right now in-house or 

do you hire consultants that—— 

Mr. GRUNDLER. We do. We don’t need to unpack 100 million lines 

of code to find these defeat devices. The bottom line is testing them 

in unpredictable ways, so that we activate these devices. That’s the 

bottom line, is what’s coming out of the tailpipe and does it meet 

our standard? 

Ms. CASTOR. Are you taking broader action now that you have 

learned these lessons about how software code can be deceptively 

used to avoid emissions standards? Do you have the expertise now 

to go and look at other code in other automobiles and trucks? 

Mr. GRUNDLER. Yes, we do. 

Ms. CASTOR. Are you going to do that? 

Mr. GRUNDLER. We are. 

Ms. CASTOR. Can you explain that a little bit further? 

Mr. GRUNDLER. Yes. So, we have a number of different kinds of 

testing we do. So, we test every new model of vehicle. I’m sorry. 

We require the manufacturers to test every new model of vehicle 

and submit that data to us, which we review along with design. We 

audit a certain percentage of those by testing them in our laboratory on prescribed test cycles. And we also audit by measuring realworld emissions using these mobile devices. And it is going to be, 

71 

going forward, a combination of both laboratory testing, activity 

testing—we know how to download this software—as well as this 

real-world monitoring. 

Ms. CASTOR. And back to VW, does EPA know yet whether VW 

can successfully fix the cars here in the U.S.? 

Mr. GRUNDLER. We don’t know that yet. 

Ms. CASTOR. OK. And VW has a number of ongoing internal and 

external investigations. Has Volkswagen committed to sharing the 

results of those investigations with EPA? 

Mr. GRUNDLER. They have not. 

Ms. CASTOR. Have you asked them—— 

Mr. GRUNDLER. Let me defer to my colleague here to confirm 

that. 

Ms. CASTOR. OK. So, have you asked them for that information? 

Mr. GRUNDLER. They have not agreed at this time. 

Ms. CASTOR. Don’t you think that would be a good—have you 

asked them whether or not they would share that information with 

EPA? 

Mr. BROOKS. We have outstanding official document requests, 

and we will be promulgating more of those. Today we learned from 

this morning’s session about one particular investigation, and that 

is certainly one that we—— 

Ms. CASTOR. OK. Will you let the committee know if VW does not 

provide the results of their internal investigation? 

Mr. BROOKS. Yes, we will. 

Ms. CASTOR. Thanks. 

And to Representative DeGette and Representative—— 

Mr. MURPHY. I’m sorry, we have a vote coming up, although if 

you have another question—— 

Ms. CASTOR. I just wanted to make one point here and submit 

this with unanimous consent. Drew Kodjak, the executive director 

from the International Council on Clean Transportation, the nonprofit that discovered the issue, said the easiest solution is to give 

EPA more resources so it can perform the real-world testing, which 

may be more expensive, but he said, ‘‘You don’t want to rely on the 

happenstance investigation of a small NGO to trigger one of the 

largest global recalls around.’’ So, that is the last thing for all of 

us. 

Mr. MURPHY. Without objection. 

[The information appears at the conclusion of the hearing.] 

Mr. MURPHY. We have got three members who need to ask questions. I have got 8 minutes and 50 seconds. Let’s do it. So, if you 

can shorten your questions out of respect for the other members, 

please do. So, that takes us down to zero. 

How many votes do we have? 

Ms. DEGETTE. Two votes. 

Mr. MURPHY. Two votes? 

All right. Dr. Bucshon? 

Mr. BUCSHON. Yes, on September 25th, 2015, the agency announced that it would be conducting additional testing to evaluate 

use of defeat devices in all vehicles. What is the current status of 

the testing? 

Mr. GRUNDLER. Thank you for that question. Our first priority is 

to test all light-duty diesel vehicles. We are in the midst of that 

72 

testing. We have teamed up with California and Environment Canada, both who have the capabilities, as we do. 

Mr. BUCSHON. And how many vehicles have you tested so far? Do 

you know? 

Mr. GRUNDLER. We are still testing the first batch of vehicles. 

Mr. BUCSHON. OK. What are you seeing so far? 

Mr. GRUNDLER. I have not seen any data yet, sir. 

Mr. BUCSHON. OK. And what criteria are you using and what is 

the procedure for implementing the testing, this testing? 

Mr. GRUNDLER. We’re being careful not to share with the automakers how we’re going to do this new testing because we want to 

be unpredictable. But it will be a combination of both these five cycles that we test on today, what we call off-cycle dyno testing as 

well as this real-world onboard monitoring. 

Mr. BUCSHON. And does this include all light-duty vehicles or 

just diesel technology? 

Mr. GRUNDLER. We’re starting with diesels. 

Mr. BUCSHON. And then, would you be willing to commit to keeping the committee informed of your progress and provide us associated details regarding the testing procedures, data, and results? 

Mr. GRUNDLER. Yes. 

Mr. BUCSHON. And do you think that this is an isolated incident 

or do you have concerns with diesel technology in general? 

Mr. GRUNDLER. I don’t have concerns with diesel technology in 

general. I don’t expect to find widespread problems, but we are 

going to be taking a very close look. 

Mr. BUCSHON. OK. I yield back, Mr. Chairman. 

Mr. MURPHY. Ms. Schakowsky is next, yes. 

Ms. SCHAKOWSKY. Thank you. 

Mr. MURPHY. And we had asked members if you don’t have a lot 

of questions to ask because we only have 6 minutes to get to the 

floor. 

Ms. SCHAKOWSKY. OK. 

Mr. MURPHY. Thank you. 

Ms. SCHAKOWSKY. Mr. Grundler, whose job is it to make consumers whole? 

Mr. GRUNDLER. We are not the Consumer Protection Agency. 

There are other Federal agencies and State agencies that have that 

responsibility. But, as I testified earlier, the consumer is going to 

be central to how we are reviewing the options to address these excess emissions. 

Ms. SCHAKOWSKY. So, let me ask you about the excess emissions 

now are violating the EPA standards, right? 

Mr. GRUNDLER. Correct. 

Ms. SCHAKOWSKY. But we just heard testimony from Volkswagen, and I have a letter sent to owners that says you can still 

drive them. So, under what authority, then, does the EPA say that 

these cars that are emitting 10 to 40 times the allowed amount to 

continue to be on the road? 

Mr. GRUNDLER. Well, the responsibility and the liability for those 

excess emissions lies with Volkswagen, and that’s why we’re conducting this investigation and learning what the remedy is, and 

then, pursuing mitigation to address the environmental harm. 

73 

Ms. SCHAKOWSKY. But you already said that some States, if they 

were to bring their car in and for some reason that defeat device 

were not on, then the consumer actually could be responsible for 

the increased emissions. Is that right? 

Mr. GRUNDLER. It’s our understanding and belief that this defeat 

device will also defeat those State inspections. So, we do not expect 

these vehicles, were they to be called in for an annual or biannual 

inspection, to fail. 

Ms. SCHAKOWSKY. So, in the meantime, though, there are half a 

million cars running around that are emitting greater emissions. 

Mr. GRUNDLER. Yes. 

Ms. SCHAKOWSKY. So, what, then, does the EPA do? We heard 

it could be for a year, maybe more than a year, before there is any 

real fix. 

Mr. GRUNDLER. So, I don’t know how long it is going to take to 

get the real fix, but the goal of our enforcement action will certainly be to make the environment whole. That is our job. 

Ms. SCHAKOWSKY. OK. So, you know already that there are half 

a million cars—— 

Mr. GRUNDLER. Yes. 

Ms. SCHAKOWSKY [continuing]. That consumers are told they can 

legally drive that are emitting more than your rules say? 

Mr. GRUNDLER. Right. 

Ms. SCHAKOWSKY. So, what is happening now to hold them accountable for that? You don’t have to test them. You know that 

they are already over the line. 

Mr. GRUNDLER. The owners of these vehicles are innocent in this 

matter. 

Ms. SCHAKOWSKY. Right. 

Mr. GRUNDLER. And we are working intently with California and 

the company to identify how to make these vehicles compliant. 

Once we are confident that we have the right remedy, we will order 

those recalls, and it will be the company’s responsibility to fix those 

vehicles. 

Ms. SCHAKOWSKY. And in the meantime, will they be penalized 

for having these noncompliant cars? 

Mr. GRUNDLER. The consumers? 

Ms. SCHAKOWSKY. No. 

Mr. GRUNDLER. The company? 

Ms. SCHAKOWSKY. The company. 

Mr. GRUNDLER. No. No, that will be the result of our ongoing investigation. That’s what will be determined by the ongoing investigation. 

Ms. SCHAKOWSKY. What part of this don’t you know already? 

What part don’t you know already? You know that all those cars 

are exceeding your rules. I don’t get it. 

Mr. GRUNDLER. Well, there are many things we don’t know. We 

don’t know the why, the what, the where, who was responsible. 

Ms. SCHAKOWSKY. No, you know the fact of it, though. 

Mr. GRUNDLER. But we know the fact. The fact is that Volkswagen designed and installed illegal software on—— 

Ms. SCHAKOWSKY. And the consequence you know, that they are 

emitting all these extra emissions? 

74 

Mr. GRUNDLER. We have not done that calculation yet, but we 

know that they can be anywhere from 10 to 40 times. 

Ms. SCHAKOWSKY. Right. 

Mr. GRUNDLER. We have not done the math to figure out what 

those excess tons are and how we are going to mitigate them. 

Ms. SCHAKOWSKY. I yield back. 

Mr. MURPHY. The gentlelady yields. 

Right now, Ms. Clarke, you are recognized for 5 minutes. 

Ms. CLARKE. Thank you, Mr. Chairman. 

Gentlemen, I would like to pick up on the point just raised by 

my colleague Ms. Schakowsky with respect to the emissions testing. New York State is one of those States that requires emissions 

testing. And typically, if your vehicle fails an emissions test, you 

can be fined, right? So, we know that, because of the defeat device, 

most likely those vehicles would not be detected? 

Mr. GRUNDLER. Correct. 

Ms. CLARKE. However, that doesn’t change the fact that under 

normal circumstances these vehicles would not be permitted on the 

road. So, to have your agency say, ‘‘Well, because it’s not your fault, 

you can continue to drive,’’ doesn’t it sort of undermine the State’s 

requirement for certain emissions levels to be contained? For you 

to then undermine that with the ability for people, notwithstanding 

the fact that it is not their fault, most people, when their vehicle 

has an emissions problem don’t recognize it and don’t typically 

think it is their fault, either. However, we have to remedy it before 

we can take our vehicles on the road. Otherwise, we are fined. We 

receive stickers, and those stickers indicate whether our vehicles 

are in compliance. 

Here we have these stealth vehicles running around in certain 

jurisdictions that do fail that, that would fail that under normal 

circumstances. How do you reconcile that? 

Mr. GRUNDLER. The fines are a matter of State law. 

Ms. CLARKE. Right. 

Mr. GRUNDLER. The way to reconcile that is to identify an effective remedy, and once that remedy is fixed, those vehicles will pass 

those State inspections and those owners will not be subject to 

fines. 

Ms. CLARKE. The challenge is the fact that this has been happening with vehicles since 2009. We have no idea when this remedy is going to be cooked up. We don’t know whether the remedy 

is going to be hard and fast, something that we can rely on. We 

are hoping, but there is going to be testing. There is going to be 

concerns going forward because of the deception of how all of this 

occurred. I mean, we are talking about software here, right? 

Mr. GRUNDLER. That’s right. 

Ms. CLARKE. How do we reconcile that? And let me ask, in addition to that, are we able to determine those States that do require—we know California, for instance. There are probably other 

States with emissions testing. How many vehicles, how many of the 

500,000 vehicles are resident within those States, and what the effect or the immediate impact would be to the environment of the 

people that reside in those States? Have we been able to get a 

sense of that? 

75 

Mr. GRUNDLER. That’s all going to be determined as a result of 

our investigation. It is knowable where these vehicles are registered—— 

Ms. CLARKE. Yes. 

Mr. GRUNDLER. —and where they reside. It is not knowable yet 

how it is going to be fixed. We want to have the confidence that 

it will be effective, but that will require some time. 

Ms. CLARKE. Do you anticipate that you will be hearing from 

States’ attorneys general and other concerned entities within these 

States, probably their own environmental protection organizations 

at the State level, to try to get a handle around this? Because, you 

know, there are certain areas where this type of emission exacerbates already troubled circumstances for individuals who have 

health compromised. I mean, do we see a sense of urgency for really dealing with this? 

Mr. GRUNDLER. We’ve already heard from both State attorneys 

general and State environmental—— 

Ms. CLARKE. I’m sure. 

Mr. GRUNDLER. I met with all the State environmental directors 

just this week in New Orleans. The air directors, they are concerned. They want to help and they are very anxious, as are we, 

to identify how these excess tons, this excess air pollution will be 

mitigated. And that will all go into part of how we are going to resolve this once and for all. We want to get to the bottom of it. 

Ms. CLARKE. In closing, Mr. Chairman, when you have been able 

to complete your analysis, if you can get to this committee a breakdown by State, that would be very helpful. We may have seen 

spikes in public health issues that have been exacerbated in some 

form or fashion based on clusters and where these cars reside. And 

we would like to be able to attribute that in some form or fashion 

to maybe the changes that occurred in the atmosphere as a result 

of maybe a cluster of ownership in a particular jurisdiction. I think 

that is going to be very important for us to know. 

Mr. GRUNDLER. I understand, and we will do whatever we can 

to serve the committee’s work here. 

Ms. CLARKE. Very well. 

I yield back, Mr. Chairman. 

Mr. MURPHY. Thank you. 

I just want to add, on top of the questions Ms. Clarke just gave, 

if you gather information with regard to State rules, with regard 

to antitampering laws, fines, and also whether it is criminal penalties and other aspects along those lines, we would appreciate 

that, as you are gathering this information for us. This would be 

helpful for the committee. 

I want to say I ask unanimous consent that the contents of the 

documents to be introduced into the record and authorize staff to 

make any appropriate redactions. So, without objection, the documents will be entered into the record, and any redactions that staff 

determines are appropriate. 

[The information appears at the conclusion of the hearing.] 

Mr. MURPHY. And I want to thank the witnesses for coming 

today. We appreciate your time and your attention in this difficult 

matter, but it is important to us. And thank you for the testimony 

and to the members for their devotion to this hearing today. 

76 

The committee rules provide that members have 10 days to submit additional questions to the record to the witnesses, and we 

hope you will respond promptly to that. 

With that, this hearing is adjourned. 

[Whereupon, at 2:32 p.m., the subcommittee was adjourned.] 

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