Volkswagen (VW) has said that the number of vehicles with understated carbon emissions is far lower than the 800,000 initially predicted.
It now believes the true figure is approximately 36,000 vehicles, providing some relief to the company as it battles another diesel-emissions scandal affecting 11 million cars worldwide that were fitted with devices to cheat nitrogen oxide emissions tests.
"Only a small number of the model variants of new cars will have the catalogue (CO2) figure slightly adjusted," VW said.
In late September it was found that VW had been implementing software in their cars which was designed to help them pass nitrogen oxide emission tests in the USA and Europe.
German newspaper reports later blamed the manipulation of the data, which had been occurring since 2013, on extremely tough reduction targets set by former CEO Martin Winterkorn.
Several VW engineers admitted tinkering with tyre pressure as well as mixing diesel with motor oil to reduce fuel consumption in order to achieve lower emissions in tests.
Winterkorn was later forced to resign from the company after the scandal emerged.
The revelation that the number of vehicles with understated carbon emissions was far lower than expected has boosted shares in the company by seven per cent.
"We view this as positive and suspect that the previously guided for negative earnings impact of €2bn will in fact end up being materially lower," said Evercore ISI analyst Arndt Ellinghorst.
While understating CO2 emissions was the smaller of the two scandals engulfing VW, some analysts had said it could have a bigger impact on sales, arguing drivers might be more worried about fuel economy than pollution.
The car firm has already allocated €6.7bn (£4.8bn) to meet the cost of recalling 11 million diesel vehicles worldwide.
Meanwhile, Audi, which is owned by VW and was also affected by the scandal, has announced it has found simple technical fixes for luxury diesel vehicles that were fitted with the cheating technology.
"Swift, straightforward and customer-friendly solutions are in discussion," said Rupert Stadler, Audi's chief executive. "Every day we are taking another step towards the solution."