GM sacks Indian auto engineer who helped expose Volkswagen's diesel fraud

Hemanth Kappanna's research helped plunge Volkswagen into a scandal that continues to plague it. In February, he got two months' pay and a one-way ticket to India

Hemanth Kappanna might seem like just another victim of corporate restructuring, a foreign worker whose skills were no longer needed, a middle-aged man with dashed American dreams.

But Mr. Kappanna, an engineer born in India who was laid off by General Motors in February, changed automotive history.

In 2013, he was part of a small team of engineering students in West Virginia whose research helped expose Volkswagen’s decade-long conspiracy to lie about its diesel cars’ emissions. The German carmaker has paid $23 billion so far to resolve criminal charges and lawsuits in the United States, and $33 billion over all.

Mr. Kappanna’s role as a hero in bringing the Volkswagen scandal to light did not protect him when his supervisor called him into a conference room in Milford, Mich., this past winter.

Mr. Kappanna, who had studied and lived in the United States for 17 years, joined G.M. in December 2014 after finishing his doctorate. His most recent job involved communicating with the Environmental Protection Agency about the American carmaker’s emissions technology.

The supervisor said it was nothing personal, Mr. Kappanna, 41, recalled by telephone from Michigan last week. His severance package consisted of two months’ pay and a one-way ticket to India. He was one of about 4,000 G.M. workers laid off in what the company called a “strategic transformation.”

“They let me go,” he said, still sounding bewildered. Unable to find a job before his work visa’s 60-day grace period expired, Mr. Kappanna returned to Bangalore, his hometown, a few days later.

Mr. Kappanna was a graduate student when he got involved in a “Mad Max” sort of experiment on Volkswagens.

He was studying at West Virginia University in Morgantown, which is known for its research on auto emissions, when the director of his program asked him to complete a grant application from the International Council on Clean Transportation. The council, a nonprofit group, wanted to test the emissions of German diesel cars sold in America. Mr. Kappanna was pursuing a doctorate, and his proposal helped the university win a modest $70,000 grant.

The university planned a real-time test of emissions, and it rigged up an ingenious way to scrutinize the exhaust generated under open-road conditions. The standard practice was to test cars in specially equipped garages, which is much easier than trying to analyze fumes from a moving vehicle.

Mr. Kappanna and two other graduate students, Marc Besch from Switzerland and Arvind Thiruvengadam from India, were chosen to do the fieldwork. They bolted portable emissions-testing equipment to a sheet of plywood and crammed it into the back of a Volkswagen diesel station wagon.

The rig, powered by a portable gasoline generator, was noisy and smelly, but with every mile, it churned out data that challenged sticker-price assurances. The emissions were dirtier than anyone would have imagined.

Mr. Kappanna and his fellow students did not know it, but they were gathering evidence of a crime. Volkswagen engineers had devised so-called defeat device software that could recognize the standardized procedure used by regulators in their testing labs. In the labs, the software dialed up a car’s pollution controls.

But when officials were not looking or, more important, when the cars were being used by regular motorists, the software dialed down to save wear and tear on the fragile emissions-control equipment. Volkswagen never expected anyone, much less a group of graduate students, to test the cars on the highway, when the defeat device would not work.

Mr. Kappanna, Mr. Besch and Mr. Thiruvengadam documented that Volkswagens polluted far more than regulations allowed when they were driven on highways and city streets. In March 2014, Mr. Besch presented the findings at a conference for emissions experts in San Diego.

Their paper did not directly accuse Volkswagen of wrongdoing. But the data it included raised red flags for officials with the California Air Resources Board and the Environmental Protection Agency who were in the audience.

The regulators began an investigation that, a year and a half later, forced Volkswagen to confess that it had installed the cheating software in 11 million diesel cars worldwide, including almost 600,000 in the United States. The inquiry called attention to the health hazards of diesel fuel and spurred consumers to shun the technology.

Today, two former Volkswagen executives are serving prison terms in the United States for their roles in trying to cover up the emissions fraud. Martin Winterkorn, Volkswagen’s former chief executive, faces criminal charges in the United States and Germany for his alleged role in the scheme. He has denied wrongdoing.

The market share of diesel cars in Europe, once the most popular engine option in the region, was only 31 percent in March, the lowest level since 2000, according to data compiled by JATO Dynamics, a research firm.

Ironically, Mr. Kappanna’s most recent position at G.M. involved complying with tougher disclosure requirements that the E.P.A. imposed on carmakers after the Volkswagen scandal.

Mr. Kappanna is proud of his role in unmasking Volkswagen’s wrongdoing, but he also wonders whether he was seen within G.M. as overly zealous about compliance and too friendly to regulators.

“Certainly they could have seen me as biased,” he said. “I can’t really say.”

G.M. said this week that Mr. Kappanna’s dismissal “was not related to any emissions compliance concerns or related issues.” That he was not a United States citizen also played no role, G.M. said in an emailed statement.

Whatever the reason, Mr. Kappanna and other G.M. workers arrived at work in Milford on Feb. 4 to find notices taped to conference room doors: The rooms had been reserved for human resources meetings. Mr. Kappanna soon received a phone call from the director of his division to meet him in one of the rooms.

“I felt it even before I stepped into the room,” Mr Kappanna said about the loss of his job.

He turned in his company laptop, and a security guard escorted him out of the building. He was one of three people let go in a department of about 50. Colleagues, he said, reassured him that his dismissal was “one of those shortsighted decisions taken to meet the numbers.”

“It was completely wrong on the part of leadership,” he said they had told him.

Still, when his co-workers invited Mr. Kappanna for a farewell beer that evening, he declined.

“I was still coming to terms with what had just happened,” he said.

He said he had a lead on a job with another automaker and still hoped to return to the United States. But the industry is suffering a slowdown, and his prospects are uncertain. Single and with no children, he was apprehensive about returning to India after spending nearly half his life in America.

“I’m a little skeptical how I’m going to adapt,” he said.