Volkswagen has suspended its chief lobbyist in response to reports the carmaker had sponsored tests that exposed monkeys and humans to toxic diesel fumes, methods condemned by its chief executive as repulsive.

Europe's largest automaker has come under fresh scrutiny after the New York Times said last week that it and German peers BMW and Daimler funded an organization called European Research Group on Environment and Health in the Transport Sector (EUGT) to commission the tests.

The report came more than two years after Volkswagen admitted to cheating US diesel emissions tests.

The emissions controversy sparked the biggest business crisis in the company’s history and led to pledges of sweeping changes to ensure such misconduct never happened again.

"Over the weekend we had to learn once more that there is still a long way ahead of us to regain lost trust," VW CEO Matthias Mueller at a reception in Brussels in his first public remarks on the tests.

"The methods used by EUGT in the United States were wrong, they were unethical and repulsive," he said.

"I am sorry that Volkswagen was involved in the matter as one of the sponsors of EUGT."

VW management board has accepted an offer by Thomas Steg, its chief lobbyist since 2012 and a former German government spokesman, to step aside.

It appointed politics expert Jens Hanefeld as his interim replacement.

A spokesman for VW Chairman Hans Dieter Poetsch said the supervisory board's executive committee will meet next week to discuss the internal investigations and ensure that such incidents will not be repeated.

"The boundaries of decent and moral conduct were clearly crossed," said Bernd Osterloh, VW's labour boss, adding he will leave no doubt about workers' opposition to such tests at next week's meeting.

"It appears as if some at VW have lost their ethical and moral bearings."

Volkswagen has suspended its chief lobbyist in response to reports the carmaker had sponsored tests that exposed monkeys and humans to toxic diesel fumes, methods condemned by its chief executive as repulsive.

Europe's largest automaker has come under fresh scrutiny after the New York Times said last week that it and German peers BMW and Daimler funded an organization called European Research Group on Environment and Health in the Transport Sector (EUGT) to commission the tests.

The report came more than two years after Volkswagen admitted to cheating US diesel emissions tests.

The emissions controversy sparked the biggest business crisis in the company’s history and led to pledges of sweeping changes to ensure such misconduct never happened again.

"Over the weekend we had to learn once more that there is still a long way ahead of us to regain lost trust," VW CEO Matthias Mueller at a reception in Brussels in his first public remarks on the tests.

"The methods used by EUGT in the United States were wrong, they were unethical and repulsive," he said.

"I am sorry that Volkswagen was involved in the matter as one of the sponsors of EUGT."

VW management board has accepted an offer by Thomas Steg, its chief lobbyist since 2012 and a former German government spokesman, to step aside.

It appointed politics expert Jens Hanefeld as his interim replacement.

A spokesman for VW Chairman Hans Dieter Poetsch said the supervisory board's executive committee will meet next week to discuss the internal investigations and ensure that such incidents will not be repeated.

"The boundaries of decent and moral conduct were clearly crossed," said Bernd Osterloh, VW's labour boss, adding he will leave no doubt about workers' opposition to such tests at next week's meeting.

"It appears as if some at VW have lost their ethical and moral bearings."