Speaking just before the unveiling of the 2016 Volkswagen Passat at an event in New York, President and CEO of Volkswagen Group of America Michael Horn made a short statement on Volkswagen’s recent diesel cheating scandal: “Our company was dishonest; we screwed up.”

Horn said the ongoing Dieselgate scandal was “completely inconsistent with our core values,” and, “We need to make it right with all of you.”

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Horn finished his statement with “We will correct this TDI issue. We will straighten this out. We will pay what we have to pay.”

Horn’s statements, and the quagmire around it, will easily eclipse what was planned for weeks to be the unveiling of the refreshed Passat, complete with a big party and a performance by Lenny Kravitz. Understandably, the mood at the event is quite different from what VW had in mind, and we’ll have more on that tomorrow.

To recap, Volkswagen and Audi face a maximum fine of $18 billion, including the possibility of pending criminal charges and being subject to Congressional hearings, as well as the company’s market value plummeting almost 20 percent following news of the scandal.

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The issue affects almost 500,000 diesel offering from Volkswagen and Audi in the U.S. with the 2.0-liter turbodiesel four-cylinder engine. Models were fitted with “a sophisticated software algorithm” that would adjust the emissions during EPA testing, and did not reflect actual normal driving conditions.

As our own Matt Hardigree points out this may only be the beginning. Things are about to get a lot worse for Volkswagen Group.

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