Volkswagen faces sales ban

By Lee Kyung-min

The Ministry of Environment said Monday that it will ban sales and revoke certifications of dozens of Audi-Volkswagen models whose test results on noise levels, fuel efficiency and emissions were manipulated.

The sanctions are likely to affect up to 150,000 vehicles, or 60 percent of about 250,000 Volkswagen vehicles sold here since 2007.

The move comes after a request by the Seoul Central District Prosecutors’ Office last week following an investigation that identified more than 30 engines that failed to meet local requirements.

The ministry said it is reviewing more than 70 models using the questionable engines.

“Currently we are determining exactly how many models will be subject to the sales ban, recall and fines,” a ministry official said. “We will announce the models as soon as we finish the work, which could be as early as next week,” he added.

Following administrative measures, the ministry will hold a hearing to give the carmaker due process to explain.

The prosecution made the request for administrative action following a months-long investigation into the German carmaker’s local unit over its alleged irregularities following an emissions scandal that emerged last year.

Last November, the ministry filed a complaint with the prosecution against the Korean unit of Volkswagen, alleging the automaker manipulated exhaust gas recirculation (EGR) software in 125,000 vehicles and thus the cars produced higher amounts of nitrogenous compounds than tests showed.

At the time, the carmaker was ordered to recall the vehicles and pay a fine of 14.1 billion won ($12.3 million).

But the company submitted a poor recall plan, not admitting to using the cheating software, in January, March and June. The ministry rejected the three plans, and now the company has to undergo the recall process anew

Last Tuesday, Park Dong-hoon, the former CEO of the Korean unit of the carmaker, was questioned over allegations that he knowingly imported and sold vehicles with the manipulation software.

Company officials said they have not yet received any official reports from the ministry, adding the carmaker’s head office in Germany is closely watching the situation because the series of administrative measures would deal a serious blow to the companysales and operations.

Juergen Stackmann, the car sales and marketing chief at the head office in Germany, also visited Korea over the weekend.