Volkswagen Scandal Leaves European Leaders, Consumers Reeling

Transcript

STEVE INSKEEP, HOST:

We are also tracking the astonishing story of Volkswagen. That company admits 11 million of its cars contain software that evades pollution emissions controls. Some of those diesel-powered cars are in the United States. The scandal's even more heavily felt in Europe, where diesel cars make up half the market. NPR's Eleanor Beardsley reports.

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MARTIN WINTERKORN: (Speaking German).

ELEANOR BEARDSLEY, BYLINE: Volkswagen's CEO Martin Winterkorn's videotaped apology was rendered a little less heartfelt by his eyes, which darted back and forth to follow a teleprompter. "Millions of people worldwide trust our cars and technology," said Winterkorn, "and I am endlessly sorry that we have disappointed this trust." Volkswagen has not explained why the devices were installed on some diesel models between 2008 and this year. The betrayal by one of its industrial giants is a blow to Germany.

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ANGELA MERKEL: (Speaking German).

BEARDSLEY: Chancellor Angela Merkel called for total transparency and a quick explanation of what happened. The shockwaves are rippling across Europe. Volkswagen has lost 25 percent of its stock value in just two days. France, Britain, Italy and Switzerland have opened investigations, and consumers have lost faith.

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BEARDSLEY: At a car inspection facility in Paris, diesel car drivers Berthe and Denis Blanc say they wonder about other carmakers now, too.

DENIS BLANC: (Speaking French).

BEARDSLEY: "I don't have much faith anymore. Yes, we're completely skeptical now," they say. Bill Diem, a journalist who writes about the European car market, explains why diesel cars are so popular here.

BILL DIEM: They've got great acceleration. They drive for a long time efficiently. If you're taking a vacation from Paris to the Alps in the winter, you want to drive a diesel. It's cheaper. It's better. It rides nice.

BEARDSLEY: Diem says consumers want diesel cars. So European carmakers build them, and European governments support their carmakers through tax breaks for diesel. Diem says diesel fuel has gotten infinitely cleaner over the past decade, but with its tiny particulates, it's still costly to clean up. And there's a hitch.

DIEM: When the diesel is really running cleanly, it's not as efficient because there's a lot of recirculation of the exhaust gases and a lot going on. So you don't get the great mileage that you get when it's a little dirtier.

BEARDSLEY: Volkswagen had only recently surpassed Toyota to become the number one carmaker, but it was struggling to make inroads in the U.S. car market.

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UNIDENTIFIED MAN: (Speaking French).

BEARDSLEY: On radio and television talk shows, many wondered if the so-called defeat devices were designed for U.S.-destined cars, given America's tougher emission standards. Louis Schweitzer, honorary president of French carmaker Renault, discussed what he called the biggest scandal in automotive history on French radio.

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LOUIS SCHWEITZER: (Through interpreter) I think VW was tempted to cheat because U.S. emissions tests are more severe than in Europe. I hate to say it, but it looks like VW chose business over the law of the land and the fight against pollution.

BEARDSLEY: While lawsuits and fines against Volkswagen could rise into the tens of billions, repairing the company's image could prove even more costly. Analysts say the scandal will also hurt the diesel car market in Europe. Even before the Volkswagen scandal, policymakers had begun questioning the choice of diesel because of concerns over urban air pollution. The mayor of Paris says she wants to make her city diesel-free by 2020. Eleanor Beardsley, NPR News, Paris. Transcript provided by NPR, Copyright NPR.