Volkswagen is in a heap of financial and legal trouble over recent revelations that the company used software code to defeat U.S. Environmental Protection Agency emission requirements for diesel engines.
VW has touted for years that new diesel technology is much cleaner than its predecessor and many people bought the company’s diesel Jettas, Passats, Golfs and Audi A3s thinking they were doing something good for the environment, all while getting great fuel economy and driving performance.
Apparently it was too good to be true. The software was designed to switch to low emissions when in a test mode in a lab or inspection station, and then return to normal pollution levels under real driving conditions. The purpose was to keep drivers from losing any of the power and performance they expected.
VW finally admitted it cheated with 11 million cars after an independent lab verified that emissions were five to 30 times the legal limit under real-world driving conditions.
One of the takeaways from this
situation is that agencies like the EPA often don’t have the resources to thoroughly monitor industry compliance with regulations.
In the United States, automakers conduct their own emissions tests and submit the results to the government, while in Europe, automakers pick who conducts the tests and where they are done. And these two regulatory systems are considered the world’s gold standards.
There are many international trade programs that involve companies policing themselves. U.S. Customs and Border Protection’s Importer Self-Assessment and the Customs-Trade Partnership Against Terrorism are two that come to mind.
They make sense. Trade enforcement and cargo security need to involve risk-based enforcement because it is impossible to inspect all shipments.
But one should bear in mind that despite the merits of trade and business facilitation, some companies will try to game the system.
This column was published in the November 2015 issue of American Shipper.
VW’s compliance scandal
