in_person_ethics_case_study_4 (1)

in_person_ethics_case_study_4 (1) - WALL STREET JOURNAL...

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WALL STREET JOURNAL Volkswagen Emissions Investigation Zeroes In on Two Engineers Company investigation focuses on two men elevated after Winterkorn was made CEO ENLARGE Ulrich Hackenberg and Wolfgang Hatz, among the engineers suspended in the investigation of the VW emissions cheating scandal, are viewed as two of the best and brightest engineers in German industry. Above, a VW factory in Chengdu, China. PHOTO: AFP/GETTY IMAGES
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By WILLIAM BOSTON Updated Oct. 5, 2015 4:10 a.m. ET WOLFSBURG, Germany—Two top Volkswagen engineers who found they couldn’t deliver as promised a clean diesel engine for the U.S. market are at the center of a company probe into the installation of engine software designed to fool regulators, according to people familiar with the matter. The two men, Ulrich Hackenberg, Audi ’s chief engineer, and Wolfgang Hatz, developer of Porsche’s Formula One and Le Mans racing engines, were among the engineers suspended in the investigation of the emissions cheating scandal that sank the company’s market value by 43% since Sept. 18 and triggered a world-wide recall to refit the engines to meet clear-air standards, these people said. Messrs. Hackenberg and Hatz, who didn’t respond to requests for comment, are viewed as two of the best and brightest engineers in German industry. They were put in charge of research and development at the Volkswagen group shortly after Martin Winterkorn became chief executive in January 2007. Mr. Winterkorn, who resigned over the scandal, couldn’t be reached for comment. The company has acknowledged that managers, struggling to meet U.S. sales targets, masked the emissions of new-car engines to sell so-called clean diesel technology to skeptical American consumers. The car maker said as many as 11 million vehicles carried a “defeat device,” software that reduces tailpipe emissions only when the car is being tested, not on the road. Several countries have since blocked sales of certain VW vehicles, and regulators are considering steps to tighten emissions standards for diesel engines. The details haven’t been made public, but Volkswagen’s investigation is focused on Messrs. Hackenberg and Hatz, Mr. Winterkorn’s top aides during his tenure at Audi, as well as Heinz- Jakob Neusser, head of development at the VW brand, people familiar with the matter said. Mr. Neusser, also suspended, joined VW from Porsche in 2011, long after the diesel engines began production. He declined to comment.
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Disclosure of the scam by the U.S. Environmental Protection Agency last month unleashed criminal investigations of Volkswagen and its management in the U.S. and Europe, and threatened to bury the company in shareholder and customer lawsuits for years. “Our company was dishonest with the EPA, and the California Air Resources Board, and with all of you,” Michael Horn, head of Volkswagen of America, told dealers last month in New York City. “We’ve totally screwed up.” For years, Volkswagen sought a triumph in the U.S. As part of an expansion of the company to sell at least 10 million cars a year by 2018, Mr. Winterkorn’s strategy was to be a leader in the
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