BERLIN: Volkswagen announced plans on Tuesday to refit up to 11 million vehicles and overhaul its namesake brand following the scandal over its rigging of emissions tests.
New chief executive Matthias Mueller said the German carmaker would tell customers in the coming days they would need to have diesel vehicles with illegal software refitted, a move which some analysts have said could cost more than US$6.5 billion.
Europe's biggest carmaker has admitted cheating in diesel emissions tests in the United States and Germany's transport minister says it also manipulated them in Europe, where Volkswagen sells about 40 percent of its vehicles.
The company is under huge pressure to address the worst business crisis in its 78-year history, which has wiped more than a third off its market value, sent shock waves through the global car market and could harm Germany's economy.
"We are facing a long trudge and a lot of hard work," Mueller told a closed-door gathering of about 1,000 top managers at Volkswagen's Wolfsburg headquarters late on Monday.
"We will only be able to make progress in steps and there will be setbacks," he said, according to a text seen by Reuters.
Volkswagen did not say how the planned refit would make cars with the "cheat" software comply with regulations, or how this might affect vehicles' mileage or efficiency, which are important considerations for customers. It said it would submit the details to Germany's KBA watchdog next month.
Manipulating emissions results allowed Volkswagen to keep down engine costs in a "clean diesel" strategy that was popular in Europe and at the heart of a drive to improve US results.
Mueller was appointed CEO on Friday to replace Martin Winterkorn. German prosecutors said on Monday they were investigating Winterkorn over allegations of fraud.
Volkswagen sold 10.1 million vehicles in the whole of 2014.
The company said last week it would set aside 6.5 billion euros (US$7.3 billion) to help cover the cost of the crisis.
But analysts think that may not be enough, as it faces potential fines from regulators and prosecutors, as well as lawsuits from cheated customers.
