Volkswagen has been caught cheating on the U.S. emissions tests.

According to BBC News, “Many VW cars being sold in America had a ‘defeat device’–or software–in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results.”

Volkswagen has been in a major push to sell diesel cars in the U.S. in recent years. They invested in a huge marketing campaign heralding the efficiency of their diesel cars. Volkswagen confessed that about 11 million cars worldwide have been outfitted with this defective device, which would create grave miscalculations on energy efficiency. BBC reports that the resulting engines could be emitting nitrogen oxide pollutants up to 40 times above what is allowed in the U.S.

Some believe this is another example of corporate greenwashing, fabricating an environmentally responsible image to generate a profit. When companies are found guilty of greenwashing, however, there can be a huge loss of brand integrity and consumer trust, which hits a company’s bottom line hard.

While many in the car industry believed diesel to be more environmentally friendly, the latest research suggests this is not the case. There are even those who believe that limitations should be imposed on diesel cars. In any case, the demand for diesel engines is likely to fall, which would largely impact the European diesel market, which is much larger than the U.S. diesel market.

The BBC reports that VW has already begun recalling 8.5 million cars in Europe and 500,000 cars in the U.S.

This situation could have implications for other car companies as well, particularly when it comes to emissions testing. California’s Air Resources Board is now looking into other manufacturers’ emission test results. The industry will have to adapt to modern EPA and international air quality standards quickly to avoid additional corporate losses.