For every bit of good news Volkswagen seems to get these days, it is offset by multiple negative items. The company was informed it was being fined $5.5 million by the Italian government and German courts are speeding up class-actions suits against the company.
The latest broadsides came after officials found out that despite the company’s ongoing diesel emissions problems, VW is once again the world’s best-selling automaker.
Though sales have been down in some markets, notably including the U.S., where it can’t sell its once-popular diesel models, VW managed to deliver 5.12 million cars, trucks and crossovers for the first half of this year, a 1.5% increase.
The Italian government’s anti-trust arm said it was the highest fine it could levy against the German automaker for “misinforming” consumers about the company’s diesel emissions results.
VW plans to fight the fine in court, according to Reuters. The company is involved in in similar court actions in North America, Asia and Europe.
Using a class-action-style procedure, the regional court near VW’s Wolfsburg, Germany headquarters wants to process claims more efficiently. It will use one case to set the precedent for the other filings, much like a class-action suit in the U.S., Reuters reported.
(Judge approves $14.7 billion VW settlement. For more, Click Here.)
Thus far, there have been 170 suits filed by investors who allege VW failed to disclose the diesel emissions cheating in a timely manner. The suits seek nearly $4 billion in damages.
“VW continues to take the view that it has duly complied with disclosure rules related to securities law,” a VW spokesman said on Monday.
(Click Here for details about VW’s surprise leap to the top of global auto sales.)
The maker, which noted the move is a “normal procedural step,” supports the effort by the court.
Volkswagen is already on the hook for $14.7 billion related to the scandal in fines and fees in the United States. The settlement with federal and state regulators was approved by a federal judge in San Francisco late last month.
(VW Q2 earnings hammered by diesel scandal. Click Here for the full story.)
After setting aside about $19 billion in its 2015 earnings to cover the scandal, VW’s bottom line has continued to take a hit, as shown by the 12% drop in operating income for the second-quarter of 2016. And its luxury arm, Audi, now says it will likely come in “slightly below” its earnings targets for the full year.