Car manufacturers have this week unveiled several new diesel models at the Detroit car show at the same time as Volkswagen confirmed a multimillion-dollar draft settlement with United States regulators to resolve its diesel emission problems.
Volkswagen will plead guilty and pay more than $6billion as part of the civil and criminal deal as the car manufacturer tries to restore its tarnished local brand.
The company said with the addition of the latest fine, its diesel costs will exceed the nearly $27billion it had put aside to deal with the problem. Volkswagen will face oversight by an independent monitor over the next three years.
The company raced to get a deal done before President Barack Obama leaves office on January 20. A change in administration may have delayed a final settlement for months.
Recapping the situation which caused Volkswagen to become the pariah of car manufacturers shows the company in 2015 admitted to installing secret software in hundreds of thousands of US diesel cars to cheat exhaust emissions tests and make them appear cleaner than they were on the road. As many as 11 million vehicles could have similar software installed worldwide.
Volkswagen's actions were particularly galling because diesels, manufactured correctly to specifications, offer higher mileage and better performance, particularly for heavier vehicles, than petrol-driven vehicles.
The fuel economy boost helps car manufacturers comply with US greenhouse gas limits. The improvements in towing and acceleration are attributes the manufacturers believe they can sell.
With CO2 emissions 15% to 20% lower than petrol engines, diesels will continue to be relevant as vehicle manufacturers make efforts to meet climate goals.
Volkswagen has blamed rogue engineers for the problem but on Monday, company executive Oliver Schmidt, the second company employee charged by US prosecutors, was accused of conspiracy to defraud the US over the company's cheating and the company was accused of concealing the cheating from regulators.
Despite paying the fine and pleading guilty, Volkswagen still must spend the next two years buying back or fixing dirty US vehicles and it faces unresolved lawsuits from US investors and about 20 US states.
Separately, a British law firm launched legal action against Volkswagen seeking thousands of pounds of compensation each for affected United Kingdom drivers.
But Volkswagen is not alone in its efforts to blur emissions data. The US Justice Department deferred prosecution agreements with Toyota Motor Crop and General Motors, both of which were accused of misleading regulators or consumers. After paying fines, they were not required to plead guilty.
In more ways than one, the scandal of tampering with the emissions data has cleared the air. Diesels account for a small fraction of US sales but more than half of all passenger vehicle sales in Europe.
In China, diesel vehicles are growing in popularity as premium brands rid themselves of the past images of producing smelly and black smoke-belching vehicles.
Overall diesel sales fell markedly in the US last year after the rigging was discovered. With the US unlikely to move on climate change issues under a Donald Trump administration, car-makers will need to try to rebuild the reputation of diesel vehicles as at least one way of helping reduce CO2 emissions in the world's largest economy.
In one of the vagaries of financial markets, the settlements by Volkswagen meant shares rose 4.2% this week to their highest level since September 2015.
Although still 10% below pre-scandal levels, the admission of guilt and the pledge by Volkswagen, and other major European car manufacturers to spend money meeting stringent emission regulations, will provide investors with confidence.
It took a major scandal to open up a wider debate on transparency of fuel efficiency data, emission targets and, finally, the resolve of vehicle manufacturers to engage with purchasers of the vehicles about what they actually want.
