Volkswagen has found irregularities when determining engine CO2 emission levels during an internal investigation.
The company said around 800,000 vehicles from the Volkswagen Group could be affected by the issue.
Volkswagen said an initial estimate puts the economic risks at approximately €2 billion (R30 billion).
“The Board of Management of Volkswagen AG will immediately start a dialog with the responsible type approval agencies regarding the consequences of these findings,” the company said.
“This should lead to a reliable assessment of the legal, and the subsequent economic consequences of this not yet fully explained issue.”