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VW Back in the Black but Diesel Scandal Takes a Stiff Toll

Profits down 20% year-over-year.

by on May.31, 2016

VW gets back into the black for Q1, but the maker see lower sales and smaller margins for all of 2016.

Volkswagen AG clawed its way back into the black during the first quarter of this year following the spectacular plunge it took last year as it dealt with a global diesel emissions scandal.

Even so, the maker’s $2.6 billion profit for the January-March quarter was down 20.1% from year earlier numbers. Excluding one-time items, VW’s operating profit was down 5.9%, to $3.5 billion. Sales and other revenues, meanwhile, slipped 3.4%, to $56.8 billion.

By the Books!

“In light of the wide range of challenges we are currently facing, we are satisfied overall with the start we have made to what will undoubtedly be a demanding fiscal year 2016,” VW CEO Matthias Mueller said in a statement.


VW Offering $1 Bil to US Diesel Owners

Reported plan would give $5,000 to each owner of rigged diesel cars.

by on Apr.20, 2016

VW could announce the compensation plan as early as this week.

Volkswagen will offer U.S. owners of vehicles with rigged diesel engines $5,000 apiece, according to a plan the embattled German automaker is reportedly preparing.

The deal, which is expected to cost VW just over $1 billion, could be disclosed as early as tomorrow when the carmaker is expected to appear before a federal judge in San Francisco. But VW is not believed to yet have a plant to fix those diesels, as it was supposed to put together by April 21st, according to reports in both the German newspaper Die Welt and on the Associated Press wire service.

Breaking News!

VW is facing more than 500 lawsuits filed on behalf of diesel owners in the wake of revelations it had equipped its vehicles with a so-called “defeat device,” software designed to detect when those cars were undergoing emissions tests and then modify engine operations to reduce levels of smog-causing oxides of nitrogen. Almost 550,000 of those vehicles were sold in the U.S., with 11 million sold worldwide.


VW Hit With New Lawsuits by Investors, Former Employee

Embattled maker accused of destroying diesel data.

by on Mar.15, 2016

VW officials initially thought the scandal would have a minimal financial impact.

Already facing more than 500 lawsuits in the U.S., Volkswagen has been hit with two new legal actions that could seriously compound the problems it is facing in the wake of revelations it cheated on diesel emissions tests.

One suit, filed in Germany by major institutional investors, seeks nearly $3.6 billion due to the lost value in Volkswagen shares which have plunged by a third since the scandal broke last September. The other new legal action was initiated by a former VW employee who claims he was fired after trying to prevent the deletion of data connected to emissions test cheating.

Breaking News!

The latter suit could prove particularly problematic as Volkswagen is under criminal investigation in several countries, including both the U.S. and Germany, and was ordered to preserve potential evidence related to its admitted rigging of diesel tests.


Dirty VW Diesels May Remain on the Road

California regulators fear no easy fix available.

by on Mar.10, 2016

Some older VW diesel models may not be completely fixed, says a California regulator.

Volkswagen has just two weeks to deliver an acceptable solution to its dirty diesel problem, according to the orders of a federal judge. But regulators in California are starting to worry that the maker might not be able to come up with a satisfactory fix short of scrapping tens of thousands of those vehicles.

As a result, a senior official with the California Air Resources Board says the organization is considering whether to let those vehicles continue to operate while falling short of both state and federal clean air mandates.

Breaking News!

“Our goal has been to fix the vehicles and return them to their certified configuration as expeditiously as possible,” CARB enforcement chief Todd Sax said during a legislative hearing in Sacramento. “Unfortunately, this may not be possible.”


German Prosecutors Target 17 in VW Diesel Scandal

CEO foresees “substantial and painful” financial damage.

by on Mar.08, 2016

Volkswagen CEO Matthias Mueller has been trying to contain the diesel scandal.

German prosecutors have now put 17 people under investigation as they widen their probe of Volkswagen’s diesel emissions cheating scandal.

The number has grown in recent weeks from the initial six employees prosecutors say they were targeting – and now goes well beyond the “handful of engineers” VW’s senior executives have long said were behind the cheating.

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Separately, VW CEO Matthias Mueller on Tuesday said he expects the scandal to result in “substantial and painful” financial damage before it is fully resolved. The maker has already set aside more than $7 billion to cover those costs while also setting up a credit line for as much as $20 billion more.


Federal Judge Demands Fix for VW Diesel Problem

Deadline set for March 24.

by on Feb.26, 2016

Judge Charles Breyer want VW to speed up diesel repairs, settlements with owners.

A federal judge in San Francisco is giving Volkswagen a month to come up with an acceptable fix that would bring 600,000 polluting diesel vehicles into compliance with U.S. emissions laws.

The announcement by U.S. District Judge Charles Breyer comes as the maker begins repairs of more than 10 million other diesel vehicles it sold outside of the United States. But so far, the German maker hasn’t been able to come up with a solution that will satisfy the Environmental Protection Agency, which first revealed last September that VW had cheated on diesel emissions tests.

The Last Word!

“Six months is long enough” to come up with a solution, said Judge Breyer, who will oversee hundreds of lawsuits filed against the German maker that were recently consolidated before his court. “This is an ongoing problem.”


Diesel Cheating An Open Secret at VW – or Was It?

CEO Mueller disputes reports, denies managers involved.

by on Jan.29, 2016

Volkswagen CEO Matthias Mueller.

It was an open secret within Volkswagen’s engineering department that the maker was cheating on diesel emissions testing, according to a report in an influential German newspaper.

The Sueddeutsche Zeitung report contends that a number of managers, as well as their staff either knew about, or were directly involved in, the efforts to create a so-called “defeat device” intended to fool emissions testers into believing VW’s 2.0-liter turbodiesel complied with tough U.S. emissions mandates. But a culture of collective secrecy kept engineers from advising corporate executives of the problems they faced.

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“Within the company there was a culture of ‘we can do everything’, so to say something cannot be done, was not acceptable,” Sueddeutsche Zeitung said, claiming to quote comments from a whistleblower who came clean as part of an ongoing, internal investigation within Volkswagen.


VW CEO Insists the Maker “Didn’t Lie”

California regulators reject proposed diesel emissions fix.

by on Jan.13, 2016

Volkswagen CEO Matthias Mueller.

Even as he continues to apologize for the diesel emissions scandal embroiling his company, Volkswagen CEO Matthias Mueller has touched off another firestorm with comments he made this week in Detroit, insisting that the maker “didn’t lie.”

Mueller’s comments, made to NPR at the North American International Auto Show in Detroit, came the same day regulators in California rejected the fix Volkswagen had proposed for close to 500,000 diesel vehicles equipped with a so-called “defeat device” designed to help it illegally pass U.S. emissions tests.

Keeping Things Honest!

“We had not the right interpretation of American law,” Mueller said in an interview with the network. “We didn’t lie. We didn’t understand the question first. And then we worked since 2014 to solve the problem. And we did it together and it was a default of VW that it needed such a long time.”


VW Blames “Whole Chain of Mistakes” for Diesel Emissions Cheating

Focus of inquiry is on “very limited group which acted irresponsibly.”

by on Dec.10, 2015

VW Chairman Hans Dieter Poetsch blames a "very limited group" for the diesel emissions cheating.

Unable to meet increasingly rigid U.S. emissions standards, a “very limited group…acted irresponsibly,” said Volkswagen Chairman Hans Dieter Poetsch, in an interim report on the carmaker’s internal investigation of its diesel emissions cheating.

VW is facing billions of dollars in fines and other costs related to the scandal which was triggered by the revelation in September that it installed a so-called “defeat device” in nearly 500,000 vehicles sold in the U.S. between 2009 and 2015, and more than 11 million models sold worldwide.

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“We are not talking about a one-off mistake, but a whole chain of mistakes that was not interrupted at any point along the time line,” Poetsch said during a meeting with reporters at VW’s headquarters in Wolfsburg, Germany.


New Volkswagen North America Chief Out After Just 3 Weeks

Move creates further turmoil amid diesel crisis.

by on Oct.14, 2015

Winfried Vahland lasted barely three weeks as head of new VW North America Region.

Less than three weeks after being appointed head of the troubled maker’s North American operations, Winfried Vahland is leaving the company.

The creation of a new North American umbrella unit, and the appointment of the former head of the Skoda brand was supposed to help bring stability at a time VW’s very existence is being threatened by a global diesel emissions cheating scandal.

Stay in the Know!

The reason for Vahland’s sudden departure was described as the result of “differing views” with top corporate management back in Wolfsburg, Germany. In a statement, VW asserted that his departure was “expressly not related” to the scandal triggered last month by word the maker had created secret software code designed to help it pass tough diesel emissions tests.