VW’s Woes Are Far From Over

2015 Volkswagen Golf TDI engine (Credit: Volkswagen )

So far, Volkswagen is facing steep fines and an extremely tarnished reputation for creating defeat devices for its TDI models. Consumers are also filing suits with a whole legion of eager attorneys who can smell blood in the water. As if that weren’t enough, the automaker is facing even more financial damage, thanks to the U.S. government.

» Related: VW Could Pay Out $86 Billion For Dieselgate

Automotive News just reported that the feds are looking into taking action against Volkswagen for taking $50 million in tax breaks as part of a diesel vehicle incentive program, which started around the time the company started cheating on emissions. VW might have to pay back triple the amount of cash it saved on taxes, thanks to the False Claims Act, plus $5,000 for each car sold under false pretenses.

More bad consequences for the automotive industry are likely coming, at least for automakers who like to “bend the truth” on emissions standards. Plenty of influential environmental groups and government regulators are talking tough measures to ensure no more cheating happens. Some have gone so far as to claim that all or at least most car companies aren’t being honest about emissions.

Whether such accusations are true or not, they will likely help fuel some sweeping changes. Many are calling for the end of self-testing when it comes to emissions, saying that the VW scandal proves that such a system doesn’t work.

Meanwhile, reports are pouring in that Volkswagen is preparing a fix that would turn off the defeat device on all TDI models. While it will mean the cars are compliant with government emissions standards, it would also likely seriously reduce fuel economy and overall performance. In other words, owners will need to stop more often for diesel, while enjoying a vehicle that is slow. Just how much of an impact the fix will have on engine output and fuel consumption remains to be seen.