California regulators reject VW repair plan for diesel vehicles linked to scandal

The California Air Resources Board has rejected Volkswagen’s proposed fix for diesel passenger vehicles outfitted with “defeat devices” that allow them to emit illegal levels of pollutants.

The state agency notified VW early Tuesday that the company’s repair plans for 2.0-liter passenger cars built between 2009 and 2015 were unacceptable because they lacked detail and inadequately addressed concerns about vehicle performance, emissions and safety.

The German auto giant has previously admitted installing improper specialized software in about 500,000 Beetles, Jettas and other cars sold in the U.S. The software allowed the diesel vehicles to pass emissions tests while, under real driving conditions, they emitted up to 40 times the legal amounts of nitrous oxides.

VW executives apologized, and promised to propose appropriate remedies to CARB and the federal Environmental Protection Agency, which announced it supports the CARB decision.

Join the conversation on Facebook >>

CARB’s decision, which does not affect a separate VW plan for an estimated 85,000 3.0-liter diesel engines also fitted with the emissions devices, sends the company back to the drawing board.

VW has been hit hard by the diesel scandal. Sales in the second half of 2015 dropped by as much as 25% in some regions of the country, in large part because without EPA approval the company was forbidden to sell new and certain certified used diesel cars -- which typically account for about 25% of overall sales.

CARB spokesperson Dave Clegern said VW’s proposals did not satisfy the agency’s need to know how the vehicles would be repaired, how quickly and with what results.

SIGN UP for the free California Inc. business newsletter >>

“It’s easier to say what they were not proposing than what they were,” Clegern said. “They just didn’t give us enough information to determine what they were proposing would actually work.”

VW engineers and executives had a Wednesday deadline to inform CARB of their plans. They must now continue discussions with the state agency. Clegern said it is CARB’s hope that VW can come up with a solution or a suite of solutions to eliminate the defeat devices.

“Getting unclean vehicles off the road is our preference,” Clegern said.

Among the possibilities, Clegern said, might be a deal in which VW buys back the offending autos from their current owners; a plan in which the pollution levels are reduced but not eliminated; and even a plan in which VW would be allowed to keep a certain number of dirty diesels on the road provided they also, at the same time, get more electric VWs into the hands of California drivers.

Twitter: @misterfleming

MORE FROM BUSINESS

Oil dips below $30 a barrel, lowest level in 12 years

International visitors to the U.S. up 4% in first half of 2015

Stocks edge down in the afternoon as energy companies and oil fall