Volkswagen's US chief to testify before House panel

VW executives in the hot seat with Congress

Volkwagen's top U.S. executive will testify on October 8 before a U.S. congressional oversight panel about the German automaker's emissions cheating scandal involving 11 million vehicles worldwide, a panel spokesman said on Thursday.

The news came after Volkswagen said it would take longer than expected to investigate its rigging of vehicle emissions tests, raising the prospect of months of uncertainty for customers, shareholders and staff.

After a seven-hour meeting, the German carmaker's supervisory board said it would take "at least several months" to complete investigations, including an external inquiry by U.S. law firm Jones Day.

Volkswagen Sept. US sales up 0.6%

As a result, it proposed cancelling a November 9 shareholder meeting it called less than a week ago to discuss the crisis.

Michael Horn, president and chief executive of Volkswagen Group of America, will appear before an investigations panel of the House Energy and Commerce Committee for proceedings scheduled to begin at 10am EDT. Lawmakers will also hear from the U.S. Environmental Protection Agency.

Europe's largest carmaker has admitted to cheating on U.S. diesel emissions tests in the United States with a software algorithm, known as a "defeat device," which switched on emissions control systems during regulatory tests.

Volkswagen also says it manipulated emissions results in Europe.

The scandal has prompted the EPA to toughen and broaden emissions tests for all automakers in an effort to thwart any other cheating activities, a move that could add to industry costs and higher regulatory hurdles.

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The committee's Republican and Democratic leaders have already asked Volkswagen and the EPA to turn over all relevant documents in preparation for a comprehensive congressional probe that aides say could last months and lead to new federal legislation on car emissions.

"The American people want to know why these devices were in place, how the decision was made to install them, and how they went undetected for so long. We will get them those answers," said U.S. Representative Tim Murphy, a Pennsylvania Republican who will preside at the hearing as chairman of the Energy and Commerce Subcommittee on Oversight and Investigations.

Representative Fred Upton, a Michigan Republican who chairs the full committee, said lawmakers would not tolerate Volkswagen's "double whammy of betrayal" against regulators and consumers.

"The very notion of a carmaker intentionally violating our environmental laws is beyond belief," he said. There was no immediate word on which EPA officials would testify.

Volkswagen has set aside 6.5 billion euros ($7.2 billion) to help cover the cost of the scandal, but some analysts think the final bill could be much higher.

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The company has said it will refit up to 11 million diesel vehicles worldwide containing software capable of cheating emission tests. It also faces potential fines from regulators and prosecutors, lawsuits from consumers and investors, and a possible hit to sales from the damage to its reputation.

In a sign it is bracing for a blow to its business, the carmaker imposed a hiring freeze at its financing arm on Tuesday and cut a shift at a German engine factory.

The company's U.S. sales for September showed little indication of an impact, though its problems only emerged late in the month. U.S. sales of VW brand vehicles rose 0.56 percent compared with September 2014, while sales of its premium Audi brand jumped 16.2 percent, the divisions said on Thursday.

The U.S. Environmental Protection Agency said a recall of affected Volkswagen diesel cars would likely take place, although a spokesperson added that no specific timeline had been ordered yet.