VW’s Bleak Options for Dealing With 500,000 Recalled Diesels
Volkswagen, bless its cheatin’ heart, is finally ready to start atoning for spoofing consumers with more than 10 million “clean” diesel cars around the world. On Thursday, the company proposed a plan to buy back the nearly 500,000 cars it fitted with emissions scamming software and sold in the US between 2008 and 2015. For owners who want to keep their cars, VW will repair them and toss in some extra cash for their trouble.
Sure, many of those cars will go the refit route. But many—maybe most—will end up as junk. A lot of junk. So much junk, that if you dumped all those junked cars into the Grand Canyon … well, they wouldn’t really fill the thing up. But they would make some pretty bitchin’ new rapids along the Colorado River.
As much as Volkswagen would love to toss its problems into a gaping abyss, it has to shuttle all that junk somewhere more productive. Basically, it’s got three options.
Option one: fix the things. About a third of the cars will get new exhaust components, software changes, and a pat on the tailpipe to send them back to their owners. Then they’ll be able to meet emissions requirements without relying on the illegal “defeat devices” that detected when the cars were being tested for compliance and changed the engine settings to follow the rules. (During normal operations, the cars were spewing up to 40 times the legal NOx limit.)
Trouble is, that’s only possible with the newer generations of Volkswagen’s diesels. “It appears that VW was slowly moving its cars towards meeting emissions requirements without having to cheat the testing procedures,” says Kelley Blue Book analyst Karl Brauer. But it looks like there’s no hope for the roughly 300,000 first generation cars. “New parts won’t physically fit under the bodywork of those vehicles,” says Brauer.
VW could change the software so the car always performs like it does during emissions testing, but that likely means a noticeable hit to the fuel economy and/or performance. That won’t sound great to customers who have the choice of just giving back the car instead of having it made worse.
Option two: exile. VW could sell these cars at discount to customers in countries with less restrictive emissions regulations. Which is pretty much akin to the “toss them in the Grand Canyon” hypothesis I floated earlier. Since VW probably isn’t quite yet ready for more negative environmental publicity, let’s assume they’ve tabled this idea. (And since the diesels can’t even meet India’s notoriously lax standards, it’s not clear where they could be dumped.)
Option three: scrap the damn things. I wish I could tell you all the cars will be gathered together at once and crushed in a single junkyard, while “Worthless” from Brave Little Toaster plays on the loudspeaker. Alas, that’s not how it works. Taking your car in for recall is voluntary (-ish, depending on which state you live in), and the VW deal will likely give customers two years to make a decision on what they’ll do. Volkswagen will probably just send each vehicle to whatever auto recycler is nearest to where the customer returns it.
One of the country’s largest recycling yards is LKQ Northern California, in Redding. Josh Coza, a sales representative and former yard worker, explains that every recycler works a little differently, based on state laws and local economics. But in general, scrapyard workers will begin by draining the car’s fluids, pulling the tires, and cutting the exhaust. Say goodbye to the wiring harnesses, AC lines, and rubber hoses. And anything else that is broken, rusted, valueless, or might somehow fail and bring harm to some hapless auto owner somewhere down the line.
Everything of value gets sorted into two general categories: Parts in demand, and parts nobody wants whole, but contain valuable metals or electronics. The engines themselves may be done, but “the pure aluminum on engine blocks, we can get a butt load out of that,” says Coza. Catalytic converters get harvested for rare earth metals like platinum, which is worth way more butts per ton than aluminum.
Even if a part is worthless, with no salvageable components, the wreckers can still turn a buck. Many parts come with a core charge, which means the government will pay the auto recycler money just to get rid of it. Coring basically assures unscrapped cars don’t pile up on the sides of freeways. “If we get something that we don’t want, we throw a core tag on it and we have a gentleman named Sal who sorts all the unwanted parts into 25 or 26 different containers,” says Coza. Then the core parts get shipped off to a landfill for auto parts.
Once stripped, it’s crushing time for the frame. “Our crusher works 12-15 hours a day, and we have a semi truck that hauls all that metal off to a recycler where it gets melted down to become awesome aluminum again,” says Coza. LQK hasn’t received any recalled Volkswagens yet—the cars have been in regulatory limbo since the scandal was made public last September—but Coza expects to see some good business. Partly because of the yard’s size, but also because it is based in California, where more than 75,000 of the cheating diesels were sold.
Coza isn’t worried about getting inundated with faulty Volkswagens. For one, he thinks his yard could handle it. “These guys are killer, they dismantle 285 cars a week,” he says. And the recall is spread out enough both temporally and geographically that used parts markets probably won’t be overly distorted by a glut of supply.
But the recall is not mandatory everywhere. Yes, it was the EPA that caught VW cheating, but states are in charge of vehicle registrations, and each has its own emissions rules. Let’s say people in Alabama, Montana, Maine, and all the other states with relatively lax emissions standards decide they don’t want to trade in their diesel-huffing Volkswagens and Audis. And, because all these recalled-but-really-not cars have lost so much value, they’re suddenly one hell of a deal. “All these cars that got into these states won’t have to deal with emissions, unless the federal government puts a statement out there saying cars with the following VINs aren’t qualified to pass registration,” says Brauer.
The biggest problem, says Brauer, is that people love these cars. And why not? They are fuel efficient (if polluting) and fun to drive. Plus, this emissions problem doesn’t really hurt the car owner. “Not like it would if they were owners of Takata airbags that were throwing shrapnel at their faces,” says Brauer. “This is like a metaphor for the challenge of environmental problems. You can put together statistics for a problem, but if you can’t manifest in a tangible way, the person has no way of dealing with it or doing anything about it.”
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