DETROIT (Oct. 26, 2015) — Volkswagen A.G.'s diesel emissions cheating scandal is changing the relationship between auto manufacturers and industry regulators.
The premeditated nature of VW's cheating has upset an uneasy but workable relationship because it violated the basic assumption that auto makers are operating in good faith.
Legislators set policy, and regulators create and enforce safety, fuel economy and emissions standards. The U.S. regulatory system usually works when both sides accept each other's financial limitations.
Auto manufacturers aim to meet regulations as inexpensively as possible, trying to keep their products affordable and competitively priced. Regulators set standardized tests to verify manufacturer compliance, but auto makers are largely allowed to self-certify.
The entire system rests on the understanding that auto makers intend to obey the rules, letting regulators focus on catching errors and lapses.
But VW smashed that system. It designed a diesel engine that never ran clean — unless it sensed it was being tested. VW defied regulators from 2009 to 2015. VW crossed the line. By doing so, it dragged the entire industry after it.
Humiliated regulators worldwide are out to catch all VW violations. But they are also less willing to assume that manufacturers intend to comply with the rules. Some regulators already have signaled they will scrutinize self-certifications more closely in the future and retest some from the past.
Aston Martin CEO Andy Palmer recently told CNN that he instructed employees to make sure the auto maker “never did and never will” use VW-style cheating devices.
That's the obvious starting point for all auto makers.
This editorial appeared in Automotive News, a Detroit-based sister publication of Tire Business.