Volkswagen ‘Dieselgate’ class action heads to court

THE first of the joint class actions against Volkswagen will front the Federal Court today as Australian owners fight for compensation over the Dieselgate scandal.

The class action takes aim at the local branches of Volkswagen, Audi and Skoda, all brands that come under the wing of Volkswagen Group Australia. It comes three years after allegations surfaced that the global car-making giant cheated on emissions tests by using engine management software that could recognise if it was being assessed, and modify the way it ran to produce a lower figure.

Volkswagen Group Australia has denied that it has broken any laws here, although it has issued a vehicle recall here to remove the defeat devices from almost 100,000 vehicles.

Australia’s consumer watchdog, the Australian Competition and Consumer Commission, will also have its first day in court after alleging Volkswagen Group Australia had engaged in misleading and deceptive conduct by selling vehicles here with the defeat device installed. Volkswagen Group Australia has also denied this.

The ACCC also alleges the defeat device has affected the performance and fuel economy of the engines, made them noiser and introduced vibrations, and also affected their longevity.

The trial is expected to take about four weeks, with an extra week in reserve.

In that time, the court will need to decide if Australian Audi, Skoda and Volkswagen owners should be compensated by Volkswagen Group similar to what the company has had to do in North America and Europe.

The final part of the trial will take place in September and is expected to seek answers to questions including why the defeat device was installed, and how Volkswagen Group Australia’s fix that it has made to the recalled cars affects fuel economy and performance.

The class action relates to the EA189 1.6-litre and 2.0-litre diesel engines sold in Australia between 2008-15. Maurice Blackburn, the legal firm behind the class action, has flagged it is investigating a similar class action against the car maker relating to a separate recall for Volkswagen’s 3.0-litre V6 engine that also used an emissions cheat – and dragged luxury sports car brand Porsche into the affair.

Volkswagen’s reaction in Australia has been to update the software in both the 1.6L and 2.0L variants of the EA189 diesel engine, while in some vehicles a minor hardware update has also been installed.

Dieselgate has already cost Volkswagen Group about $US26 billion in North America alone, and forced a more rapid change to the car maker’s future product mix so that it now wants to promote itself as an electric car innovator. It still views diesel as an important part of its product mix even though some cities around the world are now talking about banning older versions of the oil-burning engines to help reduce pollution.