BMW disputes report its diesel X3 also failed emissions test

The ongoing scandal at Volkswagen widened todayto include another automaker, as BMW denied a report in a German magazine that its X3 sport utility vehicle failed an emissions test, reportedly spewing out 11 times the legal level of pollutants while in operation.

Shares in BMW were down almost 10 per cent on the report in Auto Bild that the four-wheel-drive version of the X3 emitted 11 times the legal Europeanlimit of nitrogen oxide when tested by theInternational Council on Clean Transportation (ICCT), the same group that alerted U.S. regulators to the discrepancy between emissions levels on Volkswagens on tests versus in real-world scenarios.

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That's worse than the Passat did, but better than the Jetta, which belched out 22 times the acceptable level of nitrogen oxides, the magazine said. Thirteen other BMW models, meanwhile, passed the test.

"All measured data suggest that this is not a VW-specific issue,"ICCTmanaging directorPeter Mock was quoted by the magazine as saying.

The magazine later clarified in a subsequent article that while the car failed an emissions test, there's no evidence that its emissions system hadbeen tampered with.

BMW denied the report in a statement saying while it was not aware of the ICCT's specific tests, it did not manipulate or rig any emissions tests.

"We observe the legal requirements in each country and adhereto all local testing requirements. When it comes to our vehicles, there is no difference in the treatment of exhaust emissions whether they are on [a test] or on the road."

The automaker also said it is willing to have any of its vehicles emissions-tested by any "relevant authorities" at any time.

BMW shares lost almost 10 per cent before recovering somewhat, but late in the trading day in Frankfurt BMW shares were off by about sevenper cent, at 74.20 (about $112 Cdn). A day earlier, the shares closed at just under the80 level (just over $120 Cdn).

Much uncertainty

Analysts say a dark cloud is likely to hang over virtually all German automakers until the reality of what exactly happened inside Volkswagen comes out.

"Restoring the credibility of diesel engines likely will hinge on whether or not VW is alone in acting in this manner," Nomura analystManabu Akizuki said in a research note. "However, the BMW X5 cleared the aforementioned tests, so at this stage it seems premature to assume the problem is more widespread."

German Transport Minister Alexander Dobrindtsaid the government's investigation will involve testing vehicles produced by all automakers.

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"It is clear that the Federal Office for Motor Traffic will not exclusively concentrate on the VW models in question but that it will also carry out random tests on vehicles made by other carmakers," he said Thursday.

It's not even clear yet to what extent other brands under the Volkswagen umbrella 12 in all, includingAudi, Skoda and Porsche might be affected.

For its part, the board at Volkswagen says it will on Friday name a successor to ex-CEO Martin Winterkorn, who resigned yesterday, but it will also start naming others whobear some responsibility for the emissions scandal, Reuters reported, citing unnamed sources familiar with the situation.

German newspaper Das Bildreported Thursday that two high ranking managers,Audi's R&D boss Ulrich Hackenberg, a long-time VW brand executive and Porsche's engine chief, Wolfgang Hatz, will be dismissed at a meeting of the supervisory board on Friday.

"There must be people responsible for allowing the manipulation of emission levels to happen," Olaf Liles, the economy minister for the German state of Lower Saxony said on Thursday.