DETROIT — A German engineering company co-owned by Volkswagen Group pleaded guilty to a felony count of conspiracy in U.S. District Court here for its role in helping VW to develop the defeat device software needed to temporarily alter the performance of its first so-called clean diesel engines.
The software developed by IAV, headquartered in Berlin with offices in suburban Detroit, enabled Volkswagen to cheat on emissions testing to win certification for its Gen 1 2.0-liter turbodiesel vehicles, beginning in the 2009 model year.
Appearing before U.S. District Judge Sean Cox on Friday, IAV pleaded guilty to one count of conspiracy to defraud the U.S. and the automaker's customers in the U.S. to violate the Clean Air Act. The engineering company had agreed to plead guilty in a plea agreement last month.
The company has agreed to pay a $35 million fine, which was set under U.S. sentencing guidelines "according to the company's inability to pay a higher fine amount without jeopardizing its continued viability." It also agreed to operate under the guidelines of a court-appointed monitor for two years. However, IAV's sentencing was held in abeyance while the court conducts a probationary investigation. Sentencing was deferred until May 22.