The dark side of power

Angela Merkel has the talent to be in the right place at the right time. Currently the right place is the village Sulden in South Tyrol, your holiday home. At an altitude of 1900 meters, against the backdrop of mighty mountains, the chancellor wanders in clear air.

Many had hoped that she would descend to the Diesel summit last Wednesday to speak to her people and speak for themselves. As after the nuclear accident in Japan, when it announced the end of German nuclear energy. This time it would have been to put an end to the diesel engine and properly chastise the automotive industry, which knowingly and intentionally poisoned people and the environment.

But Angela Merkel does not fight battles that she can not win. That’s why she stays up.

Down below, in the lowlands, Transport Minister Alexander Dobrindt (CSU) and Environment Minister Barbara Hendricks (SPD) are allowed to demonstrate just how little Berlin has to oppose the power of the automotive industry. First of all, they had to relocate the diesel summit to the Ministry of the Interior at short notice, so that the company owners would be spared unpleasant encounters with demonstrating citizens and environmental activists who were relocating the Ministry of Transport. Anyone who likes driving fast can still be a coward.

After the meeting, the ministers had to present the wretched result in a press conference – Dobrindt snappy in forward defense, Hendricks pale with rage at the arrogant managers. It was in line with the minimal consensus that the industry has offered: an update of the software for more than five million diesel vehicles. Whereby this number is also beautiful, because 1.9 million of them VW has already renewed. It is by far the most cost-effective variant for the auto companies. And by far the worst for human lungs.

Of course, the ministers know that this measure is not enough to significantly improve urban air quality. Environmental associations and experts have predicted that courts, most recently the Administrative Court of Stuttgart, have confirmed their findings.

How easy it would have been for the government to hide regretfully behind these judgments. She would even get applause. According to opinion polling agency Civey, 72.8 percent of respondents felt that air pollution was over-practiced with the automotive industry. 80.6 percent of the urban population want less consideration for the interests of the industry.

So why is the government killing the corporations?

The German automotive industry is not just any industry. With around 800,000 jobs and over € 450 billion in sales, it is one of the key industries in the country, the world’s fourth largest carmaker. That makes every government blackmailable.

Add to that the pride: The Germans invented the car and are still admired worldwide for their engineering skills. Made in Germany was considered an absolute quality feature especially for cars.

Because no one knew that the engineers were tricking. And that politics has covered cheating for years. Because there is an unsavory amalgamation of personnel and interests, a system of reciprocal financial contributions and party donations plus a controlling body stunted by lobbying for a compliant appendix of the industry.

The politicians can no longer drive carmakers to the car because they have so softened the laws over the years that barely one more attacks. Over the strict demand of the ministers for more responsibility culture with the enterprises the bosses of the group probably would have enjoyed deliciously when they fled in their black limousines.

They feel unassailable, too big to fail. The appearance of VW CEO Matthias Müller at the press conference after the diesel summit was hard to beat in his arrogance; a reworking of the hardware was out of the question, in addition, he could recognize no “entrepreneurial failure”.

No failure. Despite manipulated exhaust emissions, despite cheating software, despite antitrust concerns collusion with competitors. Despite threatening driving restrictions for millions of diesel owners. For the carmaker the world is fine. All quite legal, they say. Everything?

Research of the MIRROR now show that the corporations have not only coordinated with harmless things such as the construction of convertible roofs. The material that the VW Group sent to the EU Commission and the Bundeskartellamt in Bonn as part of its self-report contains controversial documents (see page 18).

Accordingly, Daimler, BMW, Audi, and Volkswagen have agreed by no later than 2006 in their working groups, as they wanted to deceive the US environmental agencies CARB and EPA. Together with Bosch, they also arranged software for all manufacturers, with which AdBlue consumption could be extended.

They also voted to explain to the US authorities the far too small tank for urea AdBlue, which lowers nitrogen oxide emissions. A VW employee writes: Move “in a legal gray area”.

Excuses? Gray area? In fact, it all sounds like a lot of criminal energy. And strict supervision did not have to be feared, least of all by politics.

It was late on November 3, 2015, when Merkel’s government gave the automobile industry a run for its hair. Federal Transport Minister Alexander Dobrindt and his top officials met VW CEO Matthias Müller and Supervisory Board Chairman Hans Dieter Pötsch that evening. Few know of the clandestine meeting, there are no records.

The question was: what to do with the millions of diesel vehicles in which fraudulent software was used? Would you have to withdraw the approval? Or would not repurchase programs like in the US be due? But the latter, that was clear, could be impossible. “VW would have been at the end,” recalls one official.

The round agreed on a solution that should protect VW. Müller had to commit to a software update. In return, the state would waive further appeals that would harm the carmaker. Dobrindt put a condition: Müller should promise that in his company no further so-called defeat would be in use. Müller dodged, he could only hope so.

The license still applies. Since then, Volkswagen can claim that what is forbidden in the US to manipulation is not punishable in Germany. The other manufacturers, who use very similar cheating technology, were saved: their trickery was justified for technical reasons, judged by Dobrindt appointed examiner of the Federal Motor Transport Authority. “The protection of the engines is more important in this country than the protection of the lungs,” jokes Jürgen Resch, managing director of the German environmental aid (DUH).

As soon as the German government doubts, the automotive industry shows the torture instruments. In July, the lobby association VDA presents a study by the Ifo Institute in Munich, according to which 600,000 jobs depend on the combustion technology. That’s disciplined, especially in the election year.

At least since Chancellor Gerhard Schröder it belongs to a German head of government to lead the nickname “Car Chancellor”. Schröder liked to be patron saint. And his successor quickly understood the connection between maintaining power and the proximity to the key industry.

On September 23, 2008, she spoke to workers of the Volkswagen plant: “The federal government is to VW. VW is a great piece of Germany.” The sheer mass of the 18,000 workers seemed to arouse their awe. She had never spoken to so many people before. She returned with the feeling that the many employees of Volkswagen wanted “that Germany is doing well”.

The chancellor’s observers say that this visit to Wolfsburg deeply influenced her. A short time later she made a gift in the billions with the scrapping workforce and bosses.

Maybe that’s the basic problem An unfortunate symbiosis: There is a lively exchange of personnel between the government, the industry and the lobby associations. In this way, industry secures influence and access, employees money and career.

One wonders: Public servants, who yesterday seemingly with heart and soul for the welfare of their citizens, are ready a moment later, to participate in their systematic poisoning.

At this point undoubtedly highlights Exports Minister Matthias Wissmann, Merkel’s former cabinet colleague and Duzfreund. He stands before the powerful Association of the Automotive Industry (VDA). It is said that he only has to send an SMS, he already has the attention of the Chancellor.

Merkel’s former office manager at the Konrad-Adenauer-Haus, Michael Jansen, works for the Volkswagen Group as head of the Berlin corporate representation. A few months ago Opel chief lobbyist Joachim Koschnicke joined the CDU election campaign team.

They have all penetrated the Federal Government in recent years with e-mails and letters in order to enforce the interests of their corporations.

In May 2013, VDA chief Wissmann wrote to “dear Angela” that she would prevent Brussels “overdrawn” Commission proposals on CO² targets.

VW lobbyist Jansen lets the chancellery know in July 2015, on the subject of “air quality / diesel” should the proposals of the industry “largely taken into account”.

Joachim Koschnicke warns, still as Opel lobbyist, the boss of the Kraftfahrt-Bundesamt (KBA), as a permit for a new Opel model fails, this will have “potential impact on our business”. The production in five plants was threatened, “the effects would be dramatic in every way”.

And then there is Eckart von Klaeden, Minister of State at the Chancellery from 2009 to 2013, since then Head of External Affairs at Daimler.

Klaeden, nicknamed “Ecki”, is a particularly brazen case. In May 2013 Klaeden announces that he will work for Daimler as chief lobbyist from autumn onwards. Previously, the aristocrat with thick Mecki hair and boy face, has laid a picture-book career as a conservative politician: law school in Göttingen, liaison student, functionary only in the student union, then in the Junge Union, with 28 years in the Bundestag.

Already as Minister of State, he maintains good contacts with the car manufacturer, is demonstrably informed about a billion-dollar financial business of Daimler. Before the company struck shares in the space company EADS in December 2012, it has several documents come in the Chancellery and meets the responsible bankers of Daimler, a total of 23 times.

After Klaeden’s appointment, things are getting quiet around Daimler’s new chief lobbyist. The man prefers the noiseless lobbying. The test will not be long in coming. The diesel cars from Daimler emit huge amounts of harmful nitrogen oxides. Only with trickery on the exhaust system succeeds the group engineers to get the luxury cars through the test laboratories of the approval authorities.

But the measuring stations in German city centers report telltale high pollutant levels in the air. The European Commission then wants to test the cars before the approval not only on the test bench, but on the road. RDE is the name of the new process, for “Real Driving Emissions”, testing in real driving conditions. The whole dizziness threatens to fly up.

On the afternoon of March 18, 2015, Eckart von Klaeden will send an e-mail to his old colleague, the head of the Department of Economic Policy at the Chancellery (“Dear Professor Röller”). Time is running out, and not a week later, the Technical Committee on Motor Vehicles wants to decide on the RDE tests in Brussels.

Klaeden warns: “What initially sounds like a minor technical decision can have enormous consequences for the automotive industry with regard to the future use of diesel engines.” The Commission’s draft could not be accepted. One feels “massively threatened”. He would be “grateful” if the federal government “would reconsider its attitude”.

The next morning, Klaeden answers by phone. He suggests that the chancellor be contacted by a CEO. An official notes “Winterkorn?”, Apparently the former VW boss to bring the head of government on line. An inquiry, whether it came to the discussion, does not answer the chancellery.

On the same day as Klaeden, VDA CEO Matthias Wissmann speaks up. Wissmann writes an e-mail to the Chancellery Minister Peter Altmaier (“dear Peter”).

The goal here too is to slow down the regulatory zeal of EU officials. The lobbyists demand “sensible limits” and a “realistic package”. Specifically, this means that the decision as to when to introduce the road tests that are so important for the environment will be postponed. The limits want to soften Klaeden and his colleagues.

They get what they want. Peter Altmaier, the right-hand man of the head of government, takes on the matter. It is strange: Altmaier gets a “statement” written by his officials, saying that they will “ask” the Ministry of the Environment and the Ministry of Transport to explicitly address the fear voiced by VDA / Daimler on the measuring methods at the meeting in Brussels “and to take into account the” realistic overall concept “demanded by Wissmann in the” further discussions “.

The result: within 48 hours, the federal government changes its attitude, even the environmental department of Barbara Hendricks gives small. On March 24, the Technical Committee meets in Brussels. In the proposal of Germany for the so important meeting the concrete date for the introduction of strict exhaust gas tests has disappeared. Klaeden & Co. can breathe easy. In the final decision in the fall of 2015, the government comes far opposed to the manufacturers.

There is too much closeness too elsewhere, in the Kraftfahrt-Bundesamt namely. Ironically, in that authority, the first test center allows the cars and then controlled. A certain basic technical understanding should therefore be assumed among the employees, an enlightened interest anyway.

Ekhard Zinke is the president of the KBA, but he does not seem to have these qualities. So he said before the parliamentary committee of inquiry to the diesel affair seriously, only to have learned through the diesel scandal of defogging the exhaust systems.

The reason for the ignorance of the Flensburg authority could also be here again: the too close proximity of the Office to industry.

For example, in 2010 and 2011 the Federal Highway Research Institute, a sister authority, had measured significantly higher emissions of climate-damaging CO2 at several manufacturers. The KBA asked the car companies in spring 2012 for an opinion. What the then head of the KBA product monitoring unit wrote to colleagues at the Federal Institute, however, shows the ignorance: BMW and VW had even randomly tested vehicles. Doubts are then not justifiable.

So the authority that is supposed to check it out can be judged by the potential delinquents themselves? And accept the result?

The Head of Unit had very different concerns, he did not want to jeopardize his relations with the companies. “A letter of thanks should be sent to all affected manufacturers”, the KBA man suggested and therefore: The measurement results and the statements of the manufacturers do not have to appear in the project report.

Another case shows that the agency is good enough for many, but certainly not for the control of the automotive industry: In its measurements, the authority in 2016 found in over half of the examined cars dramatically excessive CO² values. The greenhouse gas can be converted directly into consumption. The front runners included an Audi A6 (plus 36.4 percent fuel consumption), a Jaguar with a plus of 28.3 percent, and a BMW 216d with 19 percent.

The figures kept the KBA under lock and key even as environmental organizations and media complained of publication. The data are trade secrets. After the MIRROR the list was published, it was said, one would have to continue to measure – with amazing results: As of the spirit hand, the increased levels had disappeared. In one case, the car suddenly no longer consumed 30 percent more, but 4 percent less than stated by the manufacturer.

Only a demand from the Greens brings light into the wonder of Flensburg. The measurements involved “drivers” who were “partly manufacturers”. That is also allowed by EU law. It is therefore also permitted to have the vehicles first checked by the manufacturer for their technical condition. In several cases, the manufacturer alleged defects were found.

Green transport expert Oliver Krischer, chairman of the parliamentary committee of inquiry, wonders: “I do not even let a criminal investigate his own case,” says the MP. DUH CEO Resch is probably not entirely wrong with his judgment of the KBA. The authority, he says, is the “bedside rug for the automotive industry”.

But now, it seems , all sides have been overwrought. The kowtowing of the government at the Diesel Summit was hard to bear, even for the most inclined observer, to grab the arrogance of the automobiles.

What had made the government people in the rage in advance, was a phrase in the offer text of the Automobile Association: “This contribution of German manufacturers is unique in Europe and worldwide,” was there in all seriousness.

“So much insolence you have to raise first,” raged one of the present officials later. “First they build the mudflaps and then they praise themselves for making them a bit cleaner.” The attitude of companies is “too limited by insight and humility,” commented Hendricks.

But how? Humility requires insight. And the CEOs are still a long way from that.

For them, the solution now found is a victory across the board. You do not need expensive hardware to retrofit expensive catalytic converters that cost up to 1500 euros per car, including installation. They come out with a dubious software update. Doubtful, because experts wonder why it has not been introduced for a long time when it is supposedly so easy to reduce nitrogen oxides by 25 to 30 percent. Doubtful, because it changes the vehicle and engine characteristics and may also affect longevity and inspection intervals.

Doubtful, but above all, because it will probably bring little. Environment Minister Hendricks, the hostess of the summit, admits, “The software updates will allow us to achieve a NOx reduction in cities, but the reduction will be well below 10 percent,” she says. But they are not enough to prevent driving bans. “That’s why I stick to it: the car industry has to reload.”

In fact, before the summit, officials at the Federal Environmental Agency were banned from accurately calculating the effect on the comma. “The result would have burdened the talks too much,” says one from the government. It would have definitively unmasked the convulsive efforts to find a compromise.

Because more important than the comparatively low cost is the goal of the motorists to avoid driving bans in the inner cities. Especially this discussion has dropped the prices for diesel vehicles in recent months by up to 25 percent. This is not only annoying for private individuals who own such cars. This will also be a burden for the big car companies. They have leased hundreds of thousands of diesel vehicles through their banks to customers. The depreciation of the vehicles could depress the balance sheets.

In addition, the increasing loss of confidence in the diesel also shows in declining registration numbers. Minus 13 percent compared to the same month last year were reported on Wednesday. For the German carmaker this is a real problem. They have committed themselves to the EU to significantly reduce CO² consumption over the next few years. This is difficult given the heavy luxury cars and SUVs that Daimler, BMW or Audi produce. Without stable sales figures in the diesel but not to do at all. Although the diesel ignites poisonous nitrogen oxides, it is better at CO² levels than comparable petrol models. If the German manufacturers do not reach their CO² targets agreed with Brussels, they will face billion-dollar fines.

In fact, you’re following the Berliner Puppet play there with great attention. Not a few in Brussels would like to give the Germans a proper one. The ruthless commitment of the federal government for its own automotive industry annoys the EU Commission increasingly.

During the diesel scandal Brussels felt how difficult it is to assert itself against the interests of the flagship industry in the most powerful EU member state. Consumer Protection Commissioner Věra Jourová repeatedly took VW and its boss Müller into the prayer, the company should better compensate the European customers. VW responded in his own way and sent a letter of complaint to Jean-Claude Juncker. There is no legal basis for this claim.

Industry Commissioner Elżbieta Bieńkowska seeks to give the Commission more rights to control the registration of new car types. It wanted to make it possible for the EU Commission to examine by random sampling for the first time whether national control authorities are fulfilling their tasks. In addition, the EU should be given the right to initiate pan-European recall campaigns. Germany, however, slowed down the project in the Council again and again.

The influence of the automotive industry is also felt everywhere in Brussels. The big German companies have well-equipped representative offices, BMW invites MPs and Commission officials to discuss climate-friendly car policy, including wine and three-course dinners. And VW’s chief lobbyist Thomas Steg, who once spoke for the government, is today playing the role of MEP in the posh Sofitel on Place Jourdan, almost within sight of Parliament.

Commission chief Jean-Claude Juncker has long recognized that the exhaust gas scandal is no longer a purely German problem, as the cars are exported to the whole of Europe. In response to the never-ending revelations in the diesel scandal, he now puts his authority on a more powerful basis. In the future, Vice President Jyrki Katainen should bring together the various strands of the diesel affair.

The strongest opponent of German carmakers, however, may not turn out to be the courts or the industrial and consumer protection commissioners, but a woman who is not famous for being lenient towards the big names of the industry – Competition Commissioner Margrethe Vestager. The 49-year-old economist from Denmark has taken on Google and Gazprom, Daimler and VW must not be afraid. Company bosses, accustomed to finding open doors in politics, have to wait months for an appointment. Lobbyists do not receive them at all.

Not even the German Minister of Transport receives preferential treatment. Alexander Dobrindts request to inform him before the diesel summit about exactly what manufacturers such as Daimler or VW is subject to antitrust laws, rejected Vestager cold. Your authority is considering the cartel allegations against the German carmaker “with priority,” Vestager wrote on July 28 to Dobrindt. Unfortunately, she could not state any further details, “the observance of confidentiality obligations” is indispensable for the “integrity and effectiveness of the procedure”. As great as Germany’s influence on Brussels politics may be, it ends at the walls of the competition authority in Rue Joseph II.

Should their authority confirm the current suspicion of cartel, penalties of completely new dimensions are imminent. The EU antitrust authorities can impose a fine of up to ten percent of sales in the previous financial year, in 2016 for the Volkswagen Group with Audi and Porsche as well as Daimler and BMW € 465 billion.

What is missing is perhaps more pronounced in Brussels than in Germany, is a strategy for the future of the auto industry. “The aim of the Commission must be to coordinate the different regulations on the limit values ​​for nitrogen dioxide, particulate matter and CO² meaningfully in the future,” says the German EU Commissioner Günther Oettinger.

He receives support from SPD MEP Ismail Ertug, who sits on the Transport Committee of the European Parliament. “The Commission should develop a master plan for the future of the European automotive industry: Which drive will we use in 2025? What will the automotive industry look like?”

Also the CDU economics expert Markus Pieper warns to narrow the debate on the German auto industry. “Dieselgate and nitric oxides are a European phenomenon, and nearly all European automakers have a responsibility to exceed limit values ​​in virtually all EU member states.”

So the question is : When does politics dawn on her to act? That it does not go on like this. When does insight come true, if not on the merits, then at least out of respect for the voters, who are not particularly enthusiastic about air pollution, driving bans and the decline in the value of their cars?

It is clear, at least: The atmosphere between politics and the car industry was already better, which was shown at the diesel summit, especially on the sidelines of the actual talks. Federal Minister of Transport Dobrindt was particularly angered that the VDA lobbyists sent their own message to the press about an hour before the official press conference, which did not reflect the full status of the negotiations. Coincidence or not – it was missing the conversion premium for drivers of older diesel vehicles, which should offer the car manufacturers.

But even in dealing with the car industry, the politicians are not unanimous. For example, participants report that Lower Saxony’s prime minister Stephan Weil, who also sits on the supervisory board of VW, tried at the last minute to reduce the number of vehicles for which the car companies must perform software updates. Of course, representatives of the auto industry immediately embraced the idea. “If Mr. Prime Minister Weil says that,” someone whispered, then Transport Secretary Dobrindt burst the collar. “It does not matter what the Lower Saxony Prime Minister says, the target size remains 100 percent,” he clarified.

So it’s pressure in the boiler – and it’s going to increase. For federal ministries and authorities have been blind and deaf for years to manipulate diesel engines, could soon take revenge. This Wednesday, a state liability action against the federal government has been filed before the Freiburg Regional Court. The law firm Stoll & Sauer, which represents 35,000 VW diesel victims and has filed 3,400 complaints for them, makes the government serious allegations.

The 50-page complaint that the MIRROR is present, is aimed directly at Dobrindts Federal Ministry of Transport. The allegation: According to EU law, his house would have had to impose dissuasive sanctions if car manufacturers, as happened at VW, manipulate the type approval of their cars. Penalties, however, do not have to be feared by car companies today.

Also against the action of the KBA, the lawsuit turns with a long list of failures of auto companies and politics. The authority had carelessly approved the diesel cars and the process for not sufficiently monitored. “For years, the authorities have not noticed any of the manipulations,” criticized lawyer Ralf Stoll. “Hints were ignored, making the German government complicit in the diesel scandal.”

If Stoll and his partners were to be tried in court, the government would be entitled to damages for the owner of a VW Golf diesel model, for which the firm has filed a public liability claim. And then theoretically, too.

Humility requires insight. Of these, the CEOs are still far away.