Volkswagen’s Dieselgate Fallout Ensnares Mega-Supplier Bosch
By now, you’ve most likely heard about Volkswagen’s little (read: huge) running afoul (read: clusterfuck) of federal emissions standards by its four-cylinder diesel engines, going back to 2009. You’ve heard that it cost now ex-CEO Martin Winterkorn his job, nearly cost U.S. CEO Micahel Horn his, and put the company in the hands of Porsche CEO Matthias Mueller. Oh, and Audi’s chief of R&D, Ulrich Hackenberg, was also canned.
The fallout is reverberating around the world. Volkswagen is planning to recall the 11 million vehicles around the world that are equipped with its cheating software that allows the cars to intentionally fudge the emissions tests. Though VW is likely hoping for a swift and clean resolution, it’s not naive enough to believe that will be the case. And as if to prove it, one of VW’s largest suppliers, Robert Bosch GmbH, is getting pulled into the fray.
Reportedly, the company — one of the largest automotive component suppliers in the world — knew of Volkswagen’s TDI shenanigans as early as 2007. Not only was it aware of it, but it actually warned the company that it was illegal, Green Car Reports noted, citing a report from the German paper Bild am Sonntag.
Bosch provided the common fuel rails for the affected TDIs, some 490,000 or so here in the U.S. It also produced the AdBlue urea injection systems that adorn the new generation of diesels but were absent on previous models because — get this — Volkswagen wanted to save $335 per vehicle, or $165 million. The company is now facing up to $18 billion in federal fines, and that’s only in the U.S.
Germany, the U.K., Switzerland, Italy, France, South Korea, Canada, Norway, and India have all launched probes into the matter.
It’s likely that Bosch won’t have the dubious distinction of being the only other company (besides VW) that gets it’s name splattered across this whole mess. Numerous consumer protection lawsuits are being, and will be, launched as a result; at this point, lawyers are throwing everything they can at VW’s wall and seeing what sticks. Bosch, however, will likely emerge relatively unscathed — and there’s precedent to prove it.
The situation that Bosch finds itself in now is nearly identical to the position that Delphi Automotive was in when General Motors’ ignition failure recall exploded. Like Bosch, Delphi was well aware of the situation long before it surfaced and, also similar to Bosch, warned General Motors that the parts being installed were not up to the proper specs. GM, like Volkswagen, ignored the company and did it anyways.
It should be noted that Bosch isn’t the company to blame. It was VW through and through that made the decision to install the software in question, and it was VW that kept up the charade since 2007 (at least). Bosch, in this situation so far, was just standing a bit too close as is so common in major scandals.
“How these components are calibrated and integrated into complete vehicle systems is the responsibility of each automaker,” said Bosch in a statement made last week. Green Car Reports noted that this isn’t unusual for the relationship between supplier and automaker. Volkswagen doesn’t build its parts — Bosch does that. Bosch doesn’t put them together — that’s Volkswagen’s job.