×

Volkswagen to recall around 8.5M cars in Europe

Volkswagen Phaeton automobiles pass along a conveyor on the assembly line at the Volkswagen AG factory in Dresden, Germany.
Kristian Bocsi | Bloomberg | Getty Images
Volkswagen Phaeton automobiles pass along a conveyor on the assembly line at the Volkswagen AG factory in Dresden, Germany.

Volkswagen said it would recall around 8.5 million diesel-engine cars in the European Union (EU) after Germany requested servicing of the vehicles following a scandal over rigged emissions tests.

VW said on Thursday that it would need to be determined outside the 28-nation EU which classes of engine EA 189 were affected. The latest engine generation EA 288 is not affected, it said.

This came after Germany's automotive watchdog, the Federal Motor Transport Authority, ordered Volkswagen to recall 2.4 million vehicles, according to Reuters news agency on Thursday morning.

The watchdog rejected the voluntary recall of vehicles put forward by Volkswagen in a plan submitted this month, according to German newspaper Bild which first reported the news.

Billions of euros have been wiped off Volkswagen's value following the revelation that the company had used software to change its diesel engines' performance under U.S. test conditions.

The company last week withdrew applications for approval to sell 2016 diesel car car models in the U.S., the Associated Press reported, after it admitted the cars contain emissions software "that would potentially help their exhaust systems run cleaner during government tests."

Also on Thursday, Italian police are reported to be searching the headquarters of sports car maker Lamborghini, according to Reuters which has cited an investigative source.

This is part of the criminal investigation into alleged commercial fraud by parent company Volkswagen, the news agency.

It added that prosecutors in Verona ordered the search in Bologna, which was conducted at the same time as a search of the Italian headquarters of Volkswagen.

Follow us on Twitter: @CNBCWorld