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Canada expands cooperation with EPA over VW scandal

It doesn't take much more than a stiff breeze to send some US pollution northward across the 49th parallel. Perhaps that's why the Canadian government says it is standing strong with the US in its continuing investigation of Volkswagen and the allegations and self-reporting that the automaker installed software to try to game emissions regulations. In fact, the Canadian government is going to do its own slate of on-road testing to see how VW diesel engines perform in real-world conditions. Last year, about 1.8 million new light-duty vehicles were sold in Canada, which is about equal to how many were sold in Maryland. That compares to about 17 million new-vehicle sales for the US. But every bit counts when it comes to an increase in potentially harmful emissions, and the Canadian government says it wants to make sure VW's diesel engines are being properly monitored, whether they're sold in Detroit, MI, or across the river in Windsor, Ontario. And that means following up – together – on allegations that Europe's biggest automaker is using so-called "defeat devices" in what it has long called its "clean diesel" engines. The automotive industry continues to be roiled by the VW scandal, in which the automaker said that as many as 11 million of its vehicles may contain software programmed to manipulate emissions-testing procedures. Volkswagen has set aside $7.3 billion to deal with the scandal, while VW CEO Martin Winterkorn was forced to step down after the issue became public. Take a look at Environment Canada's press release below. Statement - Government of Canada expands its on-going collaborative work with the U.S. EPA to assess other diesel vehicles for defeat devices OTTAWA, Sept. 26, 2015 /CNW/ - On September 22, 2015, the Government of Canada opened an investigation into Volkswagen's alleged use of defeat devices to circumvent emissions regulations. Environment Canada issued the following update on the issue: "The Government of Canada has a long history of collaborating closely with the U.S. Environmental Protection Agency (EPA) to align emission standards, as well as to provide oversight and verify compliance with applicable emission regulations "Today, the Government of Canada is announcing that it has expanded its ongoing collaborative work with the U.S. EPA to assess other diesel vehicles for defeat devices and compliance issues. "Vehicles will be subject to a variety of tests including on-road testing using portable emission measurement systems.

Mixed sales results, but automaker stocks rise on need for cars in Houston

DETROIT — The Big Three Detroit automakers on Friday reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their stocks higher. General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, while Honda fell 2.4 percent. Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands, perhaps hundreds of thousands, of vehicles after the devastation from Hurricane Harvey. Mark LaNeve, Ford's U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 "we saw a very dramatic snapback" in demand. That said, Ford sales fell 2.1 percent in August. It sold 209,897 vehicles in the United States, compared with 214,482 a year earlier. Sales were down 1.9 percent in the Ford division and off 5.8 percent at Lincoln. Demand was down for cars, crossovers and SUVs. It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford's Houston dealers may have lost fewer than 5,000 vehicles in inventory, he said. Ford is the No. 1 automaker in the Houston market, with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers and has "every indication we would have to add some production" of new vehicles to meet demand, LaNeve said. Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers' shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs. "It's got to be a positive for the industry," LaNeve said. Investors appeared to agree. GM shares rose as much as 3.3 percent to their highest since early March. Ford increased 2.8 percent at $11.34, and Fiat Chrysler's U.S.-traded shares were up 5.2 percent $15.91, hitting their highest in more than five years. GM reported a 7.5 percent increase in U.S. auto sales in August, helped by robust sales of crossovers across its four brands.

Which will Dieselgate hurt more, Volkswagen or US diesels?

The most damning response to the news Volkswagen skirted emissions regulations for its diesel models may have actually come from the Los Angeles Times. On Saturday, the Times published an editorial titled "Did Volkswagen cheat?" The answer was undoubtedly yes. When you can't drive down Santa Monica Boulevard without seeing an average of one VW TDI per block, the following words are pretty striking: "... Americans should be outraged at the company's cynical and deliberate efforts to violate one of this country's most important environmental laws." VW has successfully cultivated a strong, environmentally conscious reputation for its TDI Clean Diesel technology, especially in states where emissions are strictly controlled. A statement like that is like blood all over the opinion section of the Sunday paper. The effect on VW's business, even Germany's financial health, was already felt Monday when the company's shares plummeted 23 percent in morning trading. The statement on Sunday from VW CEO Dr. Martin Winterkorn says "trust" three times. That probably wasn't enough in nine sentences. Writers over the weekend have compared VW's crisis to one at General Motors 30 years ago, when it was the largest seller of diesel-powered passenger cars until warranty claims over an inadequate design and ill-informed technicians effectively pulled the plug on the technology at GM. In a sense, VW is in the same boat as GM because it has fired a huge blow into its own reputation and that of diesels in passenger cars. And just as automakers like Jaguar Land Rover, BMW and, ironically, GM, were getting comfortable with it again in the US. VW of America was already knee-deep in its other problems this year. Its core Jetta and Passat models are aging and it needs to wait more than a year for competitive SUVs that American buyers want. The TDIs were the only continuous bright spot in the line and on the sales charts. Even as fuel prices fell and buyers shunned hybrids, VW managed to succeed with diesels and show that Americans actually care about and accept the technology again. Fervent TDI supporters might actually lobby for that maximum $18 billion fine to VW. I've personally convinced a number of people to look at a TDI instead of a hybrid. Perhaps not so much for stop-and-go traffic, but I know buyers who liked the idea that a TDI drove like a normal car and wasn't packed with batteries.