Volkswagen starts to "fix" the issues surrounding the Diesel emissions irregularities, and about time too.

• German Minister of Transport, Alexander Dobrindt, and Chairman of the Board of Management Volkswagen Passenger Cars Brand,
  Dr Herbert Diess, heard more about the practical implementation of the measures
• An important step towards resolving the NOx emissions issue in Europe
• The first model is the Volkswagen Amarok, the Passat will follow shortly afterwards

In December 2015, the Volkswagen Group presented specific technical measures to the German Federal Motor Transport Authority (KBA) for the EA189 engines affected by the NOx issue. As agreed, Volkswagen began implementing the measures at the end of January for engines with a capacity of 2.0 litres. 

Over the next few months, the measures will also be implemented on the engines with 1.2 and 1.6-litre capacities. 

Today, German Minister of Transport, Alexander Dobrindt, and Chairman of the Board of Management Volkswagen Passenger Cars Brand, Dr Herbert Diess, met in Berlin and in the workshop of a Volkswagen dealership found out more about the practical implementation of the software update for the 2.0 TDI engine. 

Volkswagen is starting with the Amarok, with the Passat to follow shortly.

“The start of the recall is taking us a great step forwards”, says Dr Herbert Diess. “Our customers are getting a good technical solution for their car and can also rely on quick implementation of the modification.”

Customer-friendly solutions were an important aspect in developing the technical measures. For efficient implementation the affected vehicle models have been put into several groups. 

Only once the KBA has checked and confirmed the proposed measures are the customers affected being contacted and informed about the recall. In a second letter the vehicle owners will be requested to arrange an appointment with a Volkswagen partner. In terms of time, the implementation of the measure will extend across the whole of 2016.

A software update is planned for the 1.2-litre, 1.6-litre and 2.0-litre EA189 engines. The pure labour time for this will be less than half an hour. For the 1.6-litre engine a flow rectifier will additionally be fitted in the intake duct with expected labour time, inclusive of software update, of just under 45 minutes.

The recall has now begun with the 2.0 TDI engine in the Volkswagen Amarok. The installation of this new engine control software means that the Amarok now meets the limits required to comply with the EU5 emissions standard. 

The aim of Volkswagen was always to ensure that these measures do not result in a change to the fuel economy figures, performance figures or CO₂ or noise emissions of the vehicles affected. In the case of the Amarok, the Federal Motor Transport Authority has confirmed that this objective has been fully achieved.

Following in a few weeks’ time, in addition to the variants of the Passat, will be other models with the affected 2.0 TDI engines as well.Modification of the 1.2-litre engines affected is scheduled for the end of the second quarter. Completing the recall, the measures for vehicles with a 1.6-litre engine will be carried out from the third quarter of 2016.

At the same time the implementation of the technical measures will commence in other European countries in agreement with the responsible authorities and in accordance with the national requirements.

The vehicles continue to be technically safe and roadworthy and can therefore continue to be driven in road traffic without any limitations.

Volkswagen delays end of year results and postpones the AGM until further notice.

• Timing of report clarifying background of diesel emissions issue not affected
• Before special items Volkswagen anticipates the Operating Result for the Group at the level of the prior year

Volkswagen Aktiengesellschaft will set a new date for the publication of the annual accounts for fiscal year 2015 due to remaining open questions and the resulting valuation calculations relating to the diesel emissions issue. 

Consequently, new dates for the Annual Press Conference (previously planned for March 10, 2016) as well as the Annual General Meeting of shareholders, (previously planned for April 21, 2016) will be announced as soon as possible.

In this regard, Volkswagen will achieve the best possible transparent and reliable outcome for its shareholders and stakeholders.

Before special items Volkswagen anticipates the Operating Result for the Group at the level of the prior year within the expected range for fiscal year 2015.

The timing of the report clarifying the background and responsibilities connected to the diesel emission issue is not affected by this decision. Volkswagen is sticking to the timing and plans to publish the findings in the second half of April.

Reports and rumours suggest that all the new Alfa models planned for the next few years are all delayed.

Alfa Romeo will delay the sales launches of two key new models, according to sources, in a further setback for the struggling Fiat Chrysler Automobiles brand.

The Giulia Quadrifoglio midsize sedan will go on sale in Europe six months later than planned in the middle of next year, two supplier sources told Automotive News Europe. Alfa’s first SUV, based on the Giulia, will not come to market before early 2017, nine months later than planned, the same sources said.

The high-performance Giulia Quadrifoglio was due to launch in Europe by the end of this year as the first model in the Giulia lineup, Alfa’s European dealers were told during the car’s presentation in June. The car's market launch is now delayed because Alfa is working to refine some safety and ride characteristics, the sources said.

Alfa Romeo declined to comment on whether the launches of the Giulia Quadrifoglio and the SUV have been delayed.

The U.S. launches for the Giulia and Giulia-based SUV are scheduled to happen about 3 to 6 months after their European sales debuts.

FCA CEO Sergio Marchionne said on Oct. 28 that the company is re-examining Alfa's global expansion because of the slowdown in the Chinese market. He reaffirmed a planned 5 billion euro investment announced in May 2014 to boost Alfa’s annual global sales to 400,000 units with eight new models but said the investment will be completed in 2019 or 2020.

Fiat Chrysler will work hard in the next 30 to 60 days to review Alfa's business plan and the new vehicles may come in a different order to satisfy consumer tastes in Europe and North America, Marchionne told analysts on a conference call on on Oct. 28 after FCA announced its third-quarter results. The revised sequence likely will be announced in January, he said.

Alfa has not announced the details of all its planned eight new models but sources say they include a replacement for the Giulietta compact, a large sedan, as well as large and compact SUVs.

Delays to the first of those models, the Giulia and Giulia-based SUV, mean that Alfa is likely to sell well below the 400,000 units outlined in its business plan in 2018.

IHS Automotive in its latest forecast predicts that Alfa will reach slightly more than 230,000 annual sales by 2018, up from 68,000 last year. Just under 50,000 of those sales will be Giulias and about 23,000 will be Giulia-based SUV, the firm forecasts.

IHS analyst Ian Fletcher said Marchionne’s latest revision of Alfa’s revival plans appears to show that he is "managing expectations" for the brand. Marchionne may postpone the launch of niche models such as the large sedan, Fletcher said. FCA is likely to bring to market sooner the type of models Alfa needs "to enable it to survive," he said, including the Giulietta replacement.

Maserati setback

Marchionne said on the Oct. 28 call that the continued weakness of imported luxury vehicles in China had forced a reassessment of FCA's strategy for Alfa, but Max Warburton, an auto analyst at Bernstein, said Maserati’s falling sales may have prompted Marchionne to re-examine his strategy for Alfa.

"It's a bit odd to start blaming China for a fundamental change in the plan for Alfa," he said. Marchionne is probably shocked by the speed of the deterioration in Maserati’s demand. "Maserati was the dry run for Alfa and it has not gone to plan," Warburton said.

Maserati has been hurt by slowing demand in the U.S. and China, its two largest markets. The brand’s global vehicle sales fell 22 percent to 6,916 in the third quarter.

Alfa Romeos are not sold in China and FCA has not set a date for the brand’s introduction in the world’s largest market. Marchionne’s revival plan for Alfa originally called for China sales to account for about 20 percent the 400,000 target. A large portion of the volume projection that had been assigned to China will have to be absorbed by other regions, including North America and Europe, Marchionne said on Oct. 28.

Giulia volume models

The Giulia was previewed in June and officially unveiled in September at the Frankfurt auto show in the guise of the 503-hp Giulia Quadrifoglio version. The Giulia’s volume models, which will be powered by a new 2.0-liter gasoline engine and a new 2.2-liter diesel, are now likely to launch in Europe late next year instead of March next year, sources said.

When finally launched, the Giulia will attack the core of the premium midsize segment dominated both in Europe and globally by the BMW 3 series, Mercedes-Benz C class and Audi A4. German rivals, however, are not worried.

• Giulia Quadrifoglio
• New target: mid-2016
• Old target: late 2015
• Giulia-based SUV
• New target: early 2017
• Old target: spring 2016
• Giulia base models
• New target: late 2016
• Old target: March 2016

“Who is Alfa Romeo?” Audi CEO Rupert Stadler joked at the Frankfurt auto show in September. “I’m sorry, but we have to define the landscape of competition.” For Stadler, that landscape includes only Mercedes and BMW.

IHS Automotive believes Alfa will sell 22,000 Giulias in Europe during its best year, forecast to be 2018, compared with European sales of 150,000 for the Mercedes C class, a volume of 140,000 for the Audi A4 and 92,000 for the BMW 3 series in the same year.

Overly ambitious?

Even on the eve of the Giulia preview in June, analysts were sceptical about Marchionne’s ambitious plans for Alfa. Bernstein’s Warburton said in a June 18 investors note that the Giulia will eventually go on sale but “we remain unconvinced that it will be followed by a significant expansion of the model range.”

“Fiat has promised numerous re-launches for Alfa Romeo in the Marchionne era. New products and bold volume targets have come and gone,” Warburton said.

Richard Hilgert, an auto analyst at Morning star, said Marchionne’s 400,000 sales target is over-reaching. “I would be impressed if the brand sold 200,000,” he said.

Said Hilgert: “I think Marchionne set an overly-lofty target as a shock treatment to a patient in cardiac arrest. The idea being to get an immediate dramatic response, but his plan for 400,000 units in 2018 would have the patient immediately get up and run a 5-kilometer race.”

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Nick Gibbs and Luca Ciferri contributed to this report.