About before. In may of 2014, independent researchers published a report that identity higher than expected emissions which prompted investigations by the ep epa. When did vw first become aware of this researche. End of april, when it was published. I got it in may, i got information about this. What steps did vw take to evaluate the conclusions of the research at that time. First of all, to acknowledge that emission violations or higher emissions are not legal. Secondly, the engineering departments were supposed to recheck those testing results on our own equipments in order to validate this. And thirdly, to correct this with the respective software actions which have been implemented at the end of last year . Who implemented this, and who was responsible for it . Indeed the Software Applications management are being done in germany at the engine and drive Time Department within the research and development division. Okay. The epa describe a series of presentations or discussions with vw in the wake of the research in may of 2014. Who for vw was interacting with epa . Were those individuals part of vw america or vw ag, or both . Thats something i would have to check. Maybe this is also in the records provided to you next week. Okay. Great. What did vw america understand about the cause of the higher emissions between may of 14 and the voluntary recall in december of 2014 . What did your team at vw america know what is going on . That they have to my understanding validated those test results and are developing somewhere fixes in order to get this back in line. And three different tech top versions, which i didnt understand, to be honest, in order to bring this in the car. But also, as i said, all these things are vetted through the Product Safety Committee, which is worldwide responsible for this, and which is also looking at the traffic, for instance. In this context, i trusted those guys, and those processes, that everything was according to the book 100 . Okay. So at that time nobody in vw america knew that there was cheating going on in the Software Design . To my understanding, no. Then in december of 2014, vw conducted a voluntary recall that at least in part sought to address the higher onroad emissions in the model year 2009 through model year 2014 vehicles that were subject to the allegations. Would you explain what you understand this recall was intended to do . To correct the studies i mean, the results of the study of the university of West Virginia, our retesting to bring the cars, all the cars back into compliance. Okay. But that fix to the emissions problems that was implemented as part of that recall didnt resolve the issue of higher onroad emission. So the question is who was responsible for implementing that in december of 2014 . Same engine and drive Train Division within the Engineering Division in germany. What role did vw of america have in developing or validating that solution . We just have this office who do the applications. Theres also testing facility in oxnard in california who also help those folks in testing. But to my understanding, dyno testing as far as the legal situation is concerned. To be clear, vw america played no part in development of the solution. No. Okay. It may have helped validate the solution. I dont think so. You dont think so. Okay. And at that time did you or anyone in vw of america have any knowledge of the alleged defeat device . At which point of time . December 2014 when you were beginning the rollout of the recall solution, did you ever have any knowledge. No. Anybody in vw of america . My understanding, because otherwise i would have hoped they would inform me about this. Thank you. I yield back. I now recognize ms. Clark of new york for five minutes. Thank you, mr. Chairman. And i would like to think you, m to thank you, mr. Horn, for giving us as much background and knowledge of what has taken place to the best of your ability. Ive heard a couple of my colleagues on the other side of the aisle refer to what has occurred as cheating. But i would like to say to you that i believe it was an intentional deception. And i think we need to say it as it is. This wasnt a game. This was an intentional deception to bring something on the market that did not meet standards. I want to go back to something my colleague just raised about your Testing Center at oxnard. I understand that for the better part of the past year, vw was interacting with c. A. R. B. About discrepancies about high emissions involving your vehicles. What is the purpose of the oxnard facility, and is it, as the article suggests, developed to hem volkswagen meet emissions standards . To my understanding, yes. And its directly connected to the research and Development Department in germany to help them or to get the cars into Legal Compliance and to the u. S. Standards. How many employees are there . Oh, i would have to guess this. Okay. If you could just provide us with that. What was the role of the oxnard facility in understanding the test results presented by c. A. R. B. Showing unexpectedly high emissions . At this point in time i cant answer this. I dont have the understanding. I only know our department in auburn hills was interfacing with c. A. R. B. And epa for compliance for the applications and everything. You mention auburn hills. What is the role of that office . Excuse me . What is the role of the auburn hills office . To work directly on a working level, on a management level, with epa and c. A. R. B. Do the oxnard and auburn hills facilities Work Together . Now, yes. There is a structural change in terms of so prior to the unveiling of this deception, they were separate intents, they didnt interface . I think they worked together. My explanation is about the structural situation of these facilities. And they are now under one roof. Okay. But they collaborate . I hope so. Because my concern is that if we have these facilities designed specifically to address the issues of emissions of testing, and they failed, that speaks to a whole nother level of perhaps collusion with respect to this whole software debacle. Have you looked at or done any internal investigation with respect to these facilities . Thats part of the internal investigation. But my understanding is that just testing on the bases of the legal test requirements. So the engineers wouldnt have known Software Code, is that what youre saying . I think theyve tested the dyno situation for the cars and they didnt do independent road tests. Thats what i allude to. Okay. Let me jump to the whole idea of the environmental impact. How seriously does volkswagen take its commitment to the environme environmental responsibility . Maybe its difficult to understand now in this context, but its deeply embedded in our corporate culture. We have three values, responsible to our employees and the environment. Our plant in tennessee is a platinum l. E. D. Certification. This is the most clean and Energy Efficient plant in the world. And all of our plants have a commitment to reduce Carbon Footprint by 25 in 2018. And whether these plants are in india, newly built in china, theyre always up to our really to the highest volkswagen standards, which go beyond sometimes the national standards. So this is part of the corporate culture. Yes. Im assuming this is throughout your engineers and scientists, this is sort of the ethos. How do you explain this deviation, a massive deviation . Myself and the majority of volkswagen employees, which is 600,000, ask the same question, ask the same question. And its a relevant question. And i hope that these investigations will definitely find out the what drove those people, beyond newspaper articles and what would he read o what we read out there. I hope it wont be profits. Thank you, mr. Chairman. Mr. Horn, these vehicles promised unrivaled fuel economy and performance without the knox emissions usually associated with diesel. I know other members have asked about how volkswagen intends to make consumers whole. I want to lend my voice to that briefly, because consumers and people in my district purchased the car believing it would be a clean, environmental friendly choice, they have every right to feel defrauded. Consumers were sold a bill of goods that simply does not exist. And i think it is likely that whatever fixes to comply with emissions standards will hurt the vehicles performance in other ways. This is not what consumers thought they were buying. And it is not what dealers thought they were selling. Were still the resale value on these vehicles, which i am sure was a selling point, has been destroyed. Volkswagen has a lot to think about, i believe, in terms of how it depends to make right by consumer. Let me ask, typically, when deciding whether to issue a recall and develop a solution, does volkswagen conduct its own emissions testing . Yes. And did you try to recreate or confirm the results of the icct study from may of 2014 . I cant speak to this, what they specifically tested. In july 2014 i was informed that they have basically acknowledged the testing results and were developing those fixes in order to bring those cars back into compliance. A lot was said about defeat devices. And were talking about a defeat device here. Has the volkswagen operations been impacted by defeat devices in the past . I have in the context with after september 3rd, understood there was an issue for instance here in 1974, yes. Thats what i understand. And so what measures were taken by the company to make certain that there was better scrutiny, better oversight of the potential for defeat device application . At that point of time, thats a great question. And you cant get you the answer now. But was something done . In 1974, i was 12 years old. I dont know. History is history. We missed some of that, so we reach to the books and read about it. What was done, if anything, to address defeat device application . And i think the investigations will go back into this time. I dont think we need to investigate that. Did a corporate measure get put into play to address defeat devices . Back then, i dont know the answer now, sir. I would hope you could provide that to the committee. Im certain the record will be open. And if i could just confirm some of the information weve received, volkswagen initiated a voluntary recall in 2014 that was intended in part to address the issue of excess knox emissions; is that correct . Excuse me. Could you repeat the question . Volkswagen initiated a voluntary recall in december of 2014 . Yes. Who at volkswagen proposed the recall . The Technical Engineering Department in conjunction with the Product Safety Committee worldwide, which is steering all the recalls and campaigns and voluntary recall actions centrally for all markets. And what explanation was given to consumers about why that december 2014 recall was necessary . I would have to look into the document on how we what we wrote to those consumers. I dont know now. You will provide that to the committee, please . Definitely. Its public. Its public anyhow. Gsa has this as well. What explanation was given to regulators but why that recall was necessary . Thats also something we will have to provide with the documents. What fix did the volkswagen organization implement for cars brought in under that recall . All have been software fixes. New Software Versions have been flashed into the specific steering, onboard steering units. And who at volkswagen developed that fix. The engine and drive Train Development software after treatment departments in germany. And did they know at the time that it would not work . I dont know that. My understanding was it would work, and also the Safety Committee wouldnt have released this version for application in the markets. Well, i thank you for your responses. I look forward to the Additional Information you owe. And again, i would say on behalf of the consumers of the 20th Congressional District of new york, those of the country, and around the world impacted by this, deserve a sound explanation and a fix that will respond to the environmental damage done here and the consumer fraud. Yes, sir, thank you. Thank you. Ms. Deguette has one final question. I ask unanimous consent to put mr. Welchs document into the record. So ordered. Mr. Horn, you told a whole bunch of us on this committee that after that West VirginiaUniversity Study in may of 2014, everybody was running around trying to figure out what was going on with these cars and why there was a discrepancy between the tasks, that your engineers didnt know the answer. But in fact, the discrepancy was because of a willful act of some engineer in germany in the first place, correct . Thats my understanding, yes. And those people, that information about that discrepancy never made it to germany so they could tell your people what was wrong, is that what youre testifying to here today . I dont understand what youre trying to say. Well, you said your people were trying to figure out why there was a discrepancy. Right. But there were some people who knew. And those were the people who wrote that deceptive code in the first place. Are you telling me they never told the u. S. People what the problem was and why the discrepancy . The people who investigated the study in detail, the study, and developed the software fixes, were also the colleagues in germany. Of course they were informing their u. S. Colleagues in auburn hills. Did they tell the u. S. Colleagues that there was this deceptive code . I dont think so. Otherwise we would be much earlier here. Thank you, mr. Horn. This hearing is not over. We would appreciate, more questions will be coming from committee members, we would appreciate a quick and honest response to those as well. This hearing is going to add juni going to recess for an a couple of hours while the Republican Caucus is meeting. Well be back. Thank you. So the house energy and commerce subcommittee is in recess now so that republican members can attend a closed door conference vote for House Speaker which is scheduled to be underway at this hour. Media reports are indicating that the meeting may last as late as 2 00 p. M. Your calls and briefings about the election are on our companion network, cspan. Volkswagen here on the subject of this hearing, on cspan 3, has admitted to installing Software Designed to cheat emissions tests in about 11 million diesel cars worldwide. While the cars passed the test, they released nitrogen oxide up to 40 times the level allowed by federal law. The chairman of volkswagen has resigned and the Company Plans to spend about 7. 3 billion to fix the vehicles, including about half a million here in the u. S. Epa officials are due to testify at this hearing later on. Weve been asking how volkswagen should be penalized for emissions cheating. A lot of you have posted comments on facebook and twitter. Several from the cspan facebook page. Albert writes, jail time for the execs who made the decision to break the law. Tammy posted this comment, they should have to replace my car. I was lied to and cheated. From what i have read so far, any change to the software to put the vehicle in compliance will result in lower fuel mileage. And fuel mileage was the number one reason i chose my car. Im stuck with a lemon i cant even sell. John says, by refunding money to people who did not get the economy they were to get. The committee is in recess so the republican members can vote in their speaker election. Well show you this hearing again, testimony by michael horn, president and ceo of Volkswagen Group of america. Thank you and good morning. We now convene this hearing of the oversight and investigation subcommittee on volkswagen emissions cheating allegations, initial questions. Let me start off by saying my first car was a volkswagen, a 76 volkswagen beetle. I learned a lot about cars and internal combustion engines. I could take it apart and put it together and it actually continued to work. It had a legacy as the peoples car, to be peoplefriendly. I loved that car, loved it a lot, not so much as to call it brad, but i loved that car. But i trusted the car to get me around. And i trusted that volkswagen would continue to build a reliable car. That word, trust, alone, as you know, is the key factory in Building Customer loyalty. And that trust is what helped build volkswagen, because we believed the company looked out for customers first. Then just three weeks ago, car owners around the world were shocked to learn that volkswagen ag, the Worlds Largest automaker, admitted it installed software for years in millions of diesel models that effectively defeated emissions controls during driving. This followed the epas public announcement that it had sufficient evidence to support allegations that vw was cheatingen icheating on its emissions tests. The diesel vehicle switched into an operational mode designed specifically to pass the test, then switched back to a different mode during driving, which emitted chemicals at five to ten times the federal limits. In the United States alone, volkswagen and audi models have affected. Worldwide, the software was used in an estimated 11 million vehicles in 7 million vw line seven vw lines. This investigation will seek to understand the facts and circumstances surrounding the vw actions, the impact of its decisions, and related issues about emissions compliance generally. At this mornings hearing well receive testimony from the head of volkswagens american operations, mr. Michael horn, and from an epa official tasked with ensuring that automobiles on american roads meet environmental standards. The subcommittee intends to pursue answers to initial critical questions about troubling revelations about vws actions, what happened, who was involved, and most importantly, why. Let me acknowledge that mr. Horn is appearing before us voluntarily today. And i can say that i expect that he and the volkswagen organization will continue to cooperate with our inquiry. This means providing documents a