Analysts have previously questioned whether appointing Mueller as CEO was a good decision

Porsche dragged into VW emissions scandal

VW is facing fresh allegations of emission-test cheating for cars in its luxury Porsche brand.

Matthias Mueller, the company’s recently appointed CEO who was formerly a Porsche CEO, is now under pressure to prove he bears no responsibility for the scandal.

The U.S. Environmental Protection Authority (EPA) said late last night that VW used devices to rig air-pollution tests in 3.0-litre diesel engines mostly found in Audis and Porsches -- the company's biggest sources of profit.

The EPA believes around 10,000 vehicles in the United States for model years 2014 through 2016 were equipped with 3.0 litre diesel engines that used an illegal "defeat device" to lower emissions.

"It appears that it is the EPA that has discovered this violation and not VW, raising concerns around reporting, transparency and integrity within VW," said Evercore ISI analyst Arndt Ellinghorst.

Europe's largest carmaker had admitted to installing cheat software on up to 11 million vehicles worldwide with smaller diesel engines, but Porsches had previously escaped the controversy.

Without cheating, the EPA said the emissions of toxic nitrogen oxide from the vehicles were up to nine times the regulatory standard.

Germany’s ministry of transport was even implicated in the scandal and had to reject claims that it had been aware of the emission rigging practices. 

The UK government was recently urged to launch a probe into the practices in the car industry following the revelations which wiped as much as a third off VW’s stock market value.

The CEO Martin Winterkorn, who had held the position since 2007, was forced to resign from his post after the scandal emerged.

The appointment of Mueller to replace Winterkorn was criticised by some analysts and investors who questioning whether a company veteran was the right man to lead an overhaul of the business.

VW also said on Monday that "no software had been installed ... to alter emissions' characteristics in a forbidden manner" on the firms larger engines.

Rival German carmaker BMW has stated that it had not manipulated emissions tests and recently posted a surprise rise in third-quarter operating profit.

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