Wolfsburg, Germany (BBN)-VW says it has found “irregularities” in carbon dioxide emissions levels, which could affect around 800,000 cars in Europe.
The firm said the problem, which it came across while investigating diesel emissions, could cost about €2bn (£1.4bn), reports BBC.
Brands including VW, Audi, Skoda and Seat could be affected, a VW spokesman told BBC News.
The issue mainly affects diesels, but could also include petrol models.
The problem lies in the way certain car types with “smaller engines” were certified to meet carbon dioxide emissions standards, the spokesman added.
CO2 is a greenhouse gas, as opposed to the NOx involved in earlier allegations, which is a pollutant that causes lung disease.
The so-called irregularities that have now been found relate to the way in which CO2 emissions and fuel consumption were measured during the technical approval process for some models.
Volkswagen has not said whether or not it believes those irregularities were caused by deliberate action and it also has not specified which models are affected.
Matthias Mueller, VW’s chief executive, said: “From the very start I have pushed hard for the relentless and comprehensive clarification of events. We will stop at nothing and nobody. This is a painful process, but it is our only alternative. For us, the only thing that counts is the truth.”
The firm’s board will talk to regulators about the consequences of its discovery, the firm said in a statement, adding that “the safety of the vehicles is in no way compromised”.
The supervisory board issued a separate statement saying it was “deeply concerned” and promising “to ensure swift and meticulous clarification”.
The latest setback comes a day after US authorities accused VW of fitting nitrogen oxide defeat devices on its larger 3.0 litre diesel vehicles – charges which VW denied.
The company is already beset by scandal after US regulators discovered that some of its diesel vehicles were fitted with software that detected when they were undergoing emissions tests and changed the way they operated.
The so-called defeat device is understood to be in 11 million vehicles worldwide.
Earlier, it was announced that VW’s sales in the US had risen in October, despite the scandal.