The luxury car maker says the transmission control software allowed these vehicles to output between 20 and 100 per cent more NOx (oxides of nitrogen) than is permitted under EU5 regulations.
According to Forbes, Germany's federal transport authority (KBA) has stated the software amounts to a defeat device, which can detect when it's being lab tested on rollers by measuring steering wheel movement.
Alexander Dobrint, the German transport minister, told the business publication and others, the software halved NOx output until it detected steering wheel movement of over 15 degrees. He reportedly demanded an immediate recall from Audi.
In a statement, Audi explains "engine speed is unfavourably influenced by the transmission software, which can have a negative impact on the engine’s emissions". The company also "apologises to its customers for the inconvenience and is doing everything to ensure that the anomalies it has discovered will be corrected as soon as possible".
The automaker says recalled vehicles can be fixed within 30 minutes via the installation of upgraded transmission firmware.
On Friday last week, Wirtschaftswoche reported Porsche was under investigation for using a similar setup on some of its diesel vehicles. The sports car maker has reportedly denied the allegations, and investigations are understood to be continuing.