BERLIN (Reuters) -- The German government said automakers will be expected to pass on relevant information to the Federal Motor Transport Authority so that it can assess whether emissions data may have been falsified in Germany and other European countries.
The comments came after the U.S. Environmental Protection Agency said on Friday that Volkswagen had used software fitted in VW and Audi brand diesel cars that deceived regulators measuring toxic emissions.
"We expect the car companies to pass on reliable information so that the Federal Motor Transport Authority, the responsible authority in this case, can investigate whether similar manipulations took place with the emissions systems in Germany and Europe," the government said.
Germany is alarmed at the potential damage the scandal could inflict on its world-beating car industry.
German Economy Minister Sigmar Gabriel called on VW to fully clear up allegations that it manipulated emission readings. "That this is a bad case, I think is clear," Gabriel told journalists after a senior German environment ministry official described the case as "blatant consumer deception."
"You will understand that we are worried that the justifiably excellent reputation of the German car industry and in particular that of Volkswagen suffers," Gabriel said. The minister was due to discuss the issue with Volkswagen CEO Martin Winterkorn on Monday, two government sources said, without elaborating.
The way carmakers test vehicles has been coming under growing scrutiny from regulators amid complaints from environmental groups that they use loopholes in the rules to exaggerate fuel-saving and emissions results.
Shareholder and environmental groups also added to the pressure on VW in Germany.
Andreas Tilp, a lawyer representing investors in German court, says VW may have to pay damages to stockholders in Germany if the allegations of U.S. authorities are upheld. Investors may seek to recover losses incurred because of the stock’s decline.
"We’re convinced that VW failed to properly inform the markets and is liable to investors who can seek billions," Tilp said. "Concealing for years the immense risks of the pollution manipulation and the U.S. probes is a violation of capital market rules.”
Environmental group Deutsche Umwelthilfe said it will sue carmakers to have diesel vehicles removed from the streets starting 2016. It will also take legal action to have the Federal Motor Transport Authority revoke licenses for the vehicles.
While rules on emissions are similar in the U.S. and Germany, the Federal Motor Transport Authority isn’t properly controlling its implementation, Juergen Resch, DUH’s director, said in a statement. The German agency isn’t controlling pollution, and should use recalls in case of violations of environmental rules, Resch said. The Federal Motor Transport Authority’s press office didn’t reply to an e-mail seeking comment.
The European Commission said it was in contact with VW and U.S. regulators, but that it was too early to say whether any specific immediate surveillance measures were needed in Europe or whether VW vehicles in Europe were also affected. "We are taking the matter very seriously and will update you on further developments," a Commission spokesman said.
Germany's financial regulator Bafin is looking at possible violations of German rules. VW also faces legal threats from investors and environmental groups. "Like in comparable cases, with strong share movements we look at the VW stock as to insider trading, market manipulation, and ad-hoc disclosure rules," Bafin spokeswoman Anja Schuchhardt said in an e-mail. "But this is a matter of routine."
Bloomberg contributed to this report