Tesla CEO Musk, Others Urge California to Push VW Toward Electric Cars

By Mike Spector 

Tesla Motors Chief Executive Elon Musk and more than three dozen others are urging California regulators to push Volkswagen AG toward more environmentally friendly vehicles after the German auto giant recently used software to cheat on emissions tests with diesel-powered cars.

California regulators should direct Volkswagen to "accelerate greatly its rollout of zero-emission vehicles," Mr. Musk and others wrote in a letter Thursday to Mary Nichols, head of the California Air Resources Board. Unlike vehicles powered by gas and diesel engines, electric vehicles and other technologies can result in few or no emissions of pollutants.

Volkswagen in October said a new Phaeton vehicle would be electric and that the company would focus on plug-in hybrids and high-volume electric vehicles with a range exceeding 186 miles.

Representatives for Volkswagen and Tesla had no immediate comment on the letter. A CARB spokesman said, "Our focus has and will continue to be cleaning the air and advancing the cleanest vehicle and fuel technologies."

In addition to Mr. Musk, the letter to California regulators was signed by Internet entrepreneur and former eBay Inc. executive Jeff Skoll and Michael Burne, executive director of the Sierra Club.

The letter was spearheaded by Tesla investor Ion Yadigaroglu, managing principal at Capricorn Investment Group, said Michael Shank, director of media strategy at Climate Nexus, an environment-focused communications firm. Capricorn manages $4 billion with a focus on sustainable investments for Mr. Skoll, the Skoll foundation and others, according to its website.

The letter echoes arguments Mr. Yadigaroglu made earlier this year, suggesting Volkswagen should be forced to make electric vehicles as punishment for cheating on U.S. emissions tests. Volkswagen has admitted installing illegal software on nearly 500,000 diesel-powered cars sold in the U.S. since 2008 that allowed them to pollute more on the road than during government emissions tests.

The letter suggests letting Volkswagen off the hook for fixing affected diesel cars already on the road in California, claiming they represent an insignificant portion of total vehicle emissions in the state. Mr. Musk and others want the rollout of zero-emissions vehicles instead, with a goal of over the next five years achieving a 10-for-1 greater reduction in pollutant emissions compared with those associated with the diesel cheating, according to the letter.

Volkswagen should also invest in new factories and research and development in lieu of paying fines that might ultimately stem from its emissions cheating, the letter said.

Volkswagen separately on Thursday said it had appointed outside lawyer Kenneth Feinberg to administer an independent claims resolution program to address vehicles with two-liter and three-liter diesel engines affected by its emissions crisis.

Write to Mike Spector at [e-mail]

(END) Dow Jones Newswires

December 17, 2015 14:46 ET (19:46 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.