German and Japanese car companies had a reputation of solid engineering and reliability, but the emissions scandal has left some big brands in tatters – and more are expected to join them.
The problems started with Volkswagen and Audi in the US, as trading standards officials revealed hundreds of thousands of cars were fitted with software that spoofed emissions tests.
The software triggered when a test was run and returned infallible bogus results within the allowed limits even though the engines failed.
Recently, the controversy has widened as Mercedes, Opel, Peugeot and Porsche have announced they are calling back some cars.
Altogether the German brands are taking back 600,000 diesel cars for upgrades.
Mitsubishi confession over MiEV
VW faces fines in the billions of dollars. Clean air fines in the US could amount to $20 billion without considering compensation to dealers and motorists or any repairs or upgrades to vehicles.
The US Department of Justice and VW are discussing a compensation package for 500,000 motorists who have two litre diesel vehicles.
Another deal with law enforcers in the US is parked ready and waiting for 90,000 larger engine vehicles fitted with the spoof software.
Meanwhile, Mitsubishi in Japan has also confessed that 625,000 cars sold worldwide were also rigged to pass fuel efficiency and energy compliance tests that they would otherwise have failed.
The firm also makes cars for Nissan, and after government investigators raided premises, the fear is the scandal will deepen for other Japanese car makers.
Shares plunge on revelations
Shares in the companies involved in the scandal have plunged this week.
Germany’s Daimler, owner of Mercedes, dropped 5%, while VW slipped another 4% after heavy losses since the controversy broke.
Peugeot dipped 4.5% after the government raided offices in France.
Mitsubishi share prices slumped by 40% in three days, slashing $3.2 billion off the company’s market capitalisation.
The company admits filing false data about the performance of electric cars with the Japanese government. The i-MiEV model is sold in Japan and in several foreign markets. The company has also indicated other models are involved with the filing of misleading energy efficiency and mileage readings.