Following an emissions cheating scandal that has rocked Volkswagen’s reputation (and valuation) to its core, company CEO Martin Winterkorn resigned on Wednesday.

In a statement posted to the company’s website, Winterkorn took responsibility for the scandal, though acknowledged no wrongdoing on his part. The CEO opened the statement by saying he was “shocked” and “stunned” at the events of the past few days. “I am stunned that misconduct on such a scale was possible in the Volkswagen Group,” said Winterkorn.

Martin Winterkorn, former CEO of the Volkswagen Group. (Photo Credit: Volkswagen Sweden)

Martin Winterkorn, former CEO of the Volkswagen Group. (Photo Credit: Volkswagen Sweden)

The “misconduct” Winterkorn refers to dates to 2008, one year after Winterkorn succeeded Bernd Pischetsrieder as the company’s CEO. As alleged by the Environmental Protection Agency, VW has illegally installed “defeat devices” in its diesel model vehicles, software that turns off a vehicle’s emission control system while the vehicle is in motion and only turns it on when it “senses” that the vehicle is undergoing emissions testing. This device enabled Volkswagen’s diesel models to circumvent EPA Clean Air regulations and emit 10 to 40 times more pollution than the legal limits. The discrepancy in lab vs. road emissions was first detected by the International Council on Clean Transportation, which then brought the issue to the EPA.

On Sunday, Winterkorn was forced to halt sales of VW cars and issue a public apology on behalf of himself and the world’s largest automaker. On Tuesday, stock for Volkswagen AG dropped 23 percent, losing nearly $17.6 billion in market value.

“Our company was dishonest, with the EPA and the California Air Resources board, and with all of you,” said Michael Horn, chief executive of the Volkswagen Group of America, on Tuesday. “[W]e have totally screwed up,” he admitted.

As CNBC pointed out, it was just a few years ago that Volkswagen announced their goal was to become the global leader in automobile unit sales around the world. “Growth is a worthy goal,” wrote CNBC’s Michael Yoshikami, “but only when those goals are pursued in a way that will not lead to a potential cataclysmic moment when one’s misdeeds are publicized.”

Those misdeeds have now led to VW losing nearly a quarter of its market value and admitting that it installed the defeat devices to cheat US air pollution tests.

Until Tuesday, it was believed that the devices had been installed in some 500,000 VW and Audi diesel models. Volkswagen has since revealed that the devices were installed in approximately 11 million diesel vehicles worldwide. According to The Huffington Post, the carmaker has already set aside $7.3 billion to deal with the scandal, though it could face as much as $18 billion in fines and possibly criminal prosecution.

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