| 4:11 PM EST

Auto Alliance Backs VW Plea on Emission Updates

Arguing to block regional enforcement of pollution-tampering laws
#Volkswagen #europe #emissions

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Volkswagen has picked up an ally in its attempt to reverse a U.S. court ruling that would allow non-federal authorities to enforce vehicle emission rules.

The Alliance for Automotive Innovation (AAI)—a trade group that represents 37 U.S. and foreign carmakers and suppliers, including VW, in the U.S.—filed a friend-of-the-court brief yesterday in support of the German carmaker’s effort.

Images: VW

Turf Battle

VW objects to a unanimous ruling in March by a three-judge panel of 9th Circuit Court of Appeals in San Francisco regarding local-level jurisdiction over vehicle emissions.

AAI contends that allowing the ruling to stand will create confusion, complexity and cost to the ability of carmakers to maintain low emissions from their vehicles.

Passed in 1970, the Clean Air Act created the Environmental Protection Agency to set and enforce uniform emission regulations nationwide. New cars can’t be sold legally in the U.S. unless they pass EPA emission certification tests. And if vehicles don’t continue to meet those standards on the road, carmakers can expect to be ordered to recall and fix them.

VW’s Shame

VW, as we all know, infamously screwed up on both of those requirements.

The company admitted five years ago that it had deliberately rigged 555,000 diesels in the U.S. (and 10.5 million more sold elsewhere) to operate cleanly when they sensed they were being tested, but then switch to a real-world mode in which emissions jumped as much as 40-fold.

In the U.S., VW has paid some $25 billion to date for its sins in the form of civil and criminal settlements, which included retrofitting many vehicles to lower their true emission levels. The presumption was that the deals covered VW’s exposure because EPA is the ultimate rulemaker on pollution.

Not so fast, says the appellate court.

Before and After

The debate began last year when VW argued before the U.S. District Court in San Francisco that two counties—one in Florida and one in Utah—could not enforce their own anti-tampering laws against the carmaker because such matters are preempted by the Clean Air Act.

The district court agreed, but the counties appealed. The lower court’s ruling was upheld in part by the appellate judges. They agree that the Clean Air Act covers new vehicles before they’re sold. But after the sale, it says, all bets are off.

The judges rejected VW’s argument that Congress intended EPA to have jurisdiction over both pre- and post-sale compliance. They also concluded that VW’s earlier settlements included no protection against state or local prosecution.

Golf diesel testing.

Normal Tweaking?

In its brief in support of VW’s position, AAI points out that it’s not unusual for carmakers to tweak their emission control systems after the sale to keep them EPA-compliant and/or enhance their drivability and reliability.

Maybe so. But the appellate panel says that isn’t the issue here.

In this case, the judges say, VW realized its illegal system sometimes got stuck in the clean “test” mode instead of switching to the dirtier “street” mode. As a result, certain mechanical pollution control components were failing from the extra stress.

The judges say VW began quietly recalling diesels and tweaking their software well before regulators uncovered the cheating. In the meantime, VW continued to promote the engines it was selling as clean and environmentally friendly.

Staggering Exposure

The appellate court acknowledges its ruling could mean “staggering liability” for VW. But it also says Congress couldn’t have anticipated that a carmaker would intentionally tamper with post-sale vehicles to increase their pollution. “We assume,” it says, “that this conduct will be as rare as it is unprecedented.”

The panel also cites Supreme Court doctrine that says the cost of new liability alone is no reason to preempt state-level enforcement. Which sounds like the court is in no mood to rethink its decision.

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