Volkswagen scandal huge image disaster for German car industry: Diplomat

The Volkswagen emission cheating scandal is a "huge image disaster" for the entire German car industry even though it is more a software issue than engineering, German Consul General Olaf Iversen said on Tuesday.

"It is a huge image disaster not only for Volkswagen but for the entire German car industry, even though it has little to do with engineering and is more about software," Iversen said during a MCC Chamber of Commerce and Industry organised event here.

"While it is difficult to measure the impact, the fact that the company's share prices have plummeted steeply, speaks for itself," he said.

On September 18, the US Environmental Protection Agency (EPA) issued a notice of violation of the Clean Air Act to Volkswagen, accusing the company of installing software that deceived emission control tests in about half million diesel cars sold in the US since 2008.

The software, which the EPA called a "defeat device", only runs the full emission controls when the car is being tested. During normal driving, however, the car will emit nitrogen oxide of up to 40 times the standard.

Asked if the scandal was a manipulation or a simple error, Iversen replied: "Investigation is going on and what I learn from media reports, there may be some kind of manipulation, but we have to wait for the investigation to conclude to arrive at a decision."

He said a decision about recall of cars by the company will be taken early next year.

"There will certainly be a recall but it is yet to be decided whether it will be a voluntary where a customer has the option to follow the recall or not, or it will be mandatory recall under government supervision.

"The decision on the recall is expected to come early next year," he said.

About mutual trade ties, Iversen said Indo-German trade was yet to realise its potential.

"In the period between 2004 and 2014, our mutual trade has doubled to reach 16 billion Euros. However, Indo-German trade is yet to realise its full potential. So there is an ample scope of increasing trade and strengthen the economic ties," he said.

Claiming that India still continues to be a "mystery" for many people in Germany, Iversen called for enhanced tourism to allow the people of both the countries to know about each other.

"In Germany, people are not much aware about India. They know Delhi, or Mumbai but not much is known about the rest parts of the country. For many India is still a mystery, so I think we need to encourage tourism," he said.