Business: Volkswagen: The scandal explained

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Volkswagen: The scandal explained

By BBC News

What is Volkswagen accused of?

It's been dubbed the "diesel dupe". The German car giant has admitted cheating emissions tests in the US. According to the Environmental Protection Agency (EPA), some cars being sold in America had devices in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results.

VW has had a major push to sell diesel cars in the US, backed by a huge marketing campaign trumpeting its cars' low emissions. The EPA's findings cover 482,000 cars in the US only, including the VW-manufactured Audi A3, and the VW brands Jetta, Beetle, Golf and Passat. But VW has admitted that about 11 million cars worldwide are fitted with the so-called "defeat device".

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The device sounds like a sophisticated piece of kit

Full details of how it worked are sketchy, although the EPA has said that the engines had computer software that could sense test scenarios by monitoring speed, engine operation, air pressure and even the position of the steering wheel.

When the cars were operating under controlled laboratory conditions - which typically involved putting them on a stationary test rig - the device appears to have put the vehicle into a sort of safety mode in which the engine ran below normal power and performance. Once on the road, the engines switched from this test mode.

The result? The engines emitted nitrogen oxide pollutants up to 40 times above what is allowed in the US.

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What has been VW's response?

The case against VW appears cast-iron. "We've totally screwed up," said VW America boss Michael Horn, while group chief executive Martin Winterkorn said his company had "broken the trust of our customers and the public". An internal inquiry has been launched.

With VW recalling almost 500,000 cars in the US alone, it has set aside €6.5bn (£4.7bn) to cover costs. But that's unlikely to be the end of the financial impact. The EPA has the power to fine a company up to $37,500 for each vehicle that breaches standards - a maximum fine of about $18bn.

Legal action from consumers and shareholders may follow, and there is speculation that the US Justice Department will launch a criminal probe.

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Are VW's problems confined to the US?

Certainly not. Other countries, including Italy, France and South Korea, are opening investigations. Throughout the world, politicians, regulators and environmental groups are questioning the legitimacy of VW's emissions testing. France's finance minister Michel Sapin said a "Europe-wide" probe was needed in order to "reassure" the public.

At this time, only cars in the US named by the EPA are being recalled, so owners elsewhere need take no action. However, with about 11 million VW diesel cars potentially affected, further costly recalls and refits are possible. Half of the company's sales in Europe - VW's biggest market - are for diesel cars. No wonder the carmaker's shares plunged around 30% in the first couple of days after the scandal broke - with other carmakers also seeing big falls in their stock prices.

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Surely, VW heads will roll?

It's still unclear who knew what and when. In 2014, in the US, regulators raised concerns about VW emissions levels, but these were dismissed by the company as "technical issues" and "unexpected" real-world conditions. If executives and managers wilfully misled officials, it's difficult to see them surviving.

Inevitably, attention will focus on Mr Winterkorn, who recently saw off a bitter power struggle with former VW's chairman Ferdinand Piech. The engine rigging scandal could re-open old wounds. What's more, Mr Winterkorn ran the core Volkswagen brands between 2007 and 2015. "Winterkorn either knew of proceedings in the US or it was not reported to him," car analyst at Evercore ISI Arndt Ellinghorst said.

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Are other carmakers implicated?

That's for the various regulatory and government inquiries to determine. California's Air Resources Board is now looking into other manufacturers' testing results. Ford, BMW, and Renault-Nissan said they did not use "defeat devices", while other firms had yet to respond or simply stated that they complied with the laws.

The UK trade body for the car industry, the SMMT, said: "The EU operates a fundamentally different system to the US - with all European tests performed in strict conditions as required by EU law and witnessed by a government-appointed independent approval agency." But it added: "The industry acknowledges that the current test method is outdated and is seeking agreement from the European Commission for a new emissions test that embraces new testing technologies and is more representative of on-road conditions."

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That sounds like EU testing rules need tightening, too

Environmental campaigners have long argued that emissions rules are being flouted. "Diesel cars in Europe operate with worse technology on average than the US," said Jos Dings, of the pressure group Transport & Environment. "Our latest report demonstrated that almost 90% of diesel vehicles didn't meet emission limits when they drive on the road. We are talking millions of vehicles."

Car analysts at the financial research firm Bernstein agree that European standards are not as strict as those in the US. However, the analysts say in a report that there is therefore "less need to cheat". So, if other European carmakers' results are suspect, Bernstein says the "consequences are likely to be a change in the test cycle rather than legal action and fines".

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It's all another blow for the diesel market

Certainly is. Over the last decade and more, carmakers have poured a fortune into the production of diesel vehicles - with the support of many governments - believing that they are better for the environment. Latest scientific evidence suggests that's not the case, and there are even moves to limit diesel cars in some cities.

Diesel sales were already slowing, so the VW scandal comes at a bad time. "The revelations are likely to lead to a sharp fall in demand for diesel engine cars," said Richard Gane, automotive expert at consultants Vendigital.

"In the US, the diesel car market currently represents around 1% of all new car sales and this is unlikely to increase in the short to medium term.

"However, in Europe the impact could be much more significant, leading to a large tranche of the market switching to petrol engine cars virtually overnight."

Current Affairs : Test shows how old your body really is

Test shows how old your body really is

By  BBC News

Scientists say they have developed a way of testing how well, or badly, your body is ageing.

They say it could help predict when a person will die, identify those at high-risk of dementia and could affect medicine, pensions and insurance.

The team at King's College London say looking at "biological age" is more useful than using a date of birth.

However, the work, published in Genome Biology, provides no clues as to how to slow the ageing process.

The test looks for an "ageing signature" in your body's cells by comparing the behaviour of 150 genes.

It was developed by initially comparing 54,000 markers of gene activity in healthy, but largely sedentary, 25 and 65-year-olds and then whittling them down to a final 150.

Prof Jamie Timmons, from King's College London, told the BBC News website: "There's a healthy ageing signature that's common to all our tissues, and it appears to be prognostic for a number of things including longevity and cognitive decline.

"It looks like from the age of 40 onwards you can use this to give guidance on how well an individual is ageing."

And while some lifestyle decisions, like spending all day on the sofa, could be bad for your health they do not appear to affect the speed your body ages.

The team believe combining lifestyle factors and your biological age would give a more accurate picture of your health.

Death's door?

The researchers tried the test out on samples from a group of 70-year-old men in Sweden.

They worked out who was ageing well and who was ageing very rapidly and were able to predict who would die in the next few years.

"You could actually pick out people who had almost no chance of being dead, and you have people who had an almost 45% chance of being dead," said Prof Timmons told the BBC.

There are plans to pilot the test in organ transplants in the UK to see if people who are technically old, but have a young "biological age", can still donate organs safely.

The researchers say it could also alter cancer screening, with people who are ageing rapidly needing to be screened at a younger age.

He said that it could be used in conjunction with other checks to identify those at highest risk of developing the neurodegenerative disease and to enrol them in clinical trials.

"What we really need now are tools to identify those most at risk in 10, 20 years time and I think that's where this research will really have an impact," he added.

Worth a pension?

The research group at King's are aware that being able to check your biological age could have wide-ranging consequences from pensions to insurance premiums.

Prof Timmons told the BBC: "It raises a number questions, no doubt, and strenuous debate, but we are judged by our age already so this might be a smarter way of doing it.

"You might decide not to pay so much into your pension and enjoy your life as it is now."

Dr Neha Issar-Brown, from the UK's Medical Research Council, said: "This new test holds great potential as with further research, it may help improve the development and evaluation of treatments that prolong good health in older age."

Dr Eric Karran, from the charity Alzheimer's Research UK, said: "One of the biggest questions in human biology is how we age, and how this process impacts our wider health and risk for conditions like Alzheimer's.

"There is much interest in developing a blood test for diseases like Alzheimer's but such a test would need rigorously validating to show it was accurate and sensitive before it could be used in the clinic."

Current Affairs: Catalan president steps up breakaway plan

Catalan president steps up breakaway plan

The Financial Times

Catalan leaders will take their campaign for independence from Spain to a new level, with a plan to establish the region’s own diplomatic service, central bank, tax authority — and possibly even its armed forces.

The plan could be put into practice as soon as next month, provided that voters in the prosperous northern region hand a sufficiently large majority to pro-independence parties in a regional election on September 27. “This is not about declaring independence immediately. This is about starting a process that leads to an independent Catalan state,” Artur Mas, the Catalan president, said in an interview with the Financial Times.

“One crucial task for the next government will be to create the state structures that will succeed those of the Spanish state: the tax authority, for example, which we have already worked on for the past year and a half, or social security or the central bank,” he added.

The idea of building a state within the Spanish state — sure to infuriate Madrid — comes after the central government has repeatedly rejected pleas from Mr Mas and others to allow a formal referendum on Catalan independence.

The pro-independence camp has responded by styling the regional election, less than three weeks away, as a quasi-referendum on independence. If their parties win an outright majority, they have vowed to establish a government lasting no longer than 18 months to carry out the institutional spadework that would lead the region towards independence.

Such a government would include, for the first time, a minister in charge of external affairs, tasked with setting up a Catalan diplomatic service. “We currently have commercial offices, and offices abroad that deal with tourism and culture. But we don’t yet have a network of external services like a state has. All that will have to be designed by the future government in the next 18 months,” Mr Mas said. Aside from building the institutions of a future independent state, the legislature would also initiate the process of drafting a separate Catalan constitution.

The most sensitive task, he added, would be to prepare “the design” for a future Catalan military. “Defence is the most delicate of all these aspects, and there is no consensus about this in Catalonia,” Mr Mas said. “But my party and I personally believe that Catalonia has to remain part of Nato. And as a member of Nato we have to pay our dues . . . It would be impossible for Catalonia not to have its own defence structure, even though it would be a light one.”

Spain’s conservative government, which also faces re-election this year, insists that regions have no right to determine their own political future — let alone to secede from the Spanish state.

In recent years, however, Catalonia’s pro-independence movement has tested that stance to the limit. Independence rallies have drawn hundreds of thousands of protesters on to the streets of the prosperous region — a spectacle that is due to be repeated on Friday, when Catalans mark their national day. Last November, Mr Mas and the regional government also organised an informal independence poll in which 2.3m Catalans took part. Though the vote had no legal consequence, it was widely seen as another sign of Catalan disaffection with Spain, which has heightened in recent years by disputes over financial burden-sharing and demands for greater regional autonomy.

“In the past three years we have made more progress than in the previous three centuries,” Mr Mas said, speaking in the sumptuous medieval palace in the centre of Barcelona that is the seat of the Catalan presidency.

This month’s regional election is intended to mark the beginning of the Catalan endgame — by delivering a genuine popular mandate for a break with Spain. To that end, Mr Mas’s conservative Convergencia Democratica party has formed a common electoral list with the left-wing Esquerra Republicana movement — the first time the two main pro-independence parties have joined forces. Together with a smaller, far-left pro-independence party known as CUP, the list hopes to secure an absolute majority in parliament — with the power to press ahead with the statehood plan.

“If we have a majority in parliament on the night of September 27 we will continue with the process. If we don’t have a majority, it is evident that the process cannot continue,” Mr Mas said.

Critics argue that Mr Mas and his allies are putting the electoral bar too low. They note that the region’s electoral system will allow the pro-independence bloc to win an absolute majority in parliament with as little as 45 per cent of the vote — much less than would be needed in a straight in/out referendum along the lines of the Scottish plebiscite last year.

Mr Mas acknowledged that an absolute majority of votes would give even more “strength and legitimacy” to the independence push than a majority of seats in parliament. But he insisted that the result would be valid all the same: “In a parliamentary election you count seats not votes.”