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VW Facing $9 Bil in Investor Claims Over Diesel Scandal

Shareholders lost billions once scam was revealed.

by on Sep.21, 2016

VW's costs continue to grow as a result of its diesel emissions scandal.

After already agreeing to claims and penalties worth nearly $20 billion, Volkswagen now faces more than 1,400 investor lawsuits that could cost it another $9 billion.

A flood of lawsuits have landed on the doorstep of the regional court in Braunschweig, Germany as a one-year deadline for filing claims approaches. It was on September 18, 2015 that the U.S. Environmental Protection Agency accused the automaker of rigging 475,000 vehicles equipped with a 2.0-liter turbodiesel to pass American emissions tests.

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The automaker quickly acknowledged the subterfuge – which involved a total of 11 million vehicles sold worldwide – and also admitted using a so-called “defeat device” on a higher-end 3.0-liter diesel sold by the Audi and Porsche brands, as well as through VW.


VW Diesel Scandal Takes Down Audi Exec, Spreads to Supplier Bosch

Audi’s top engineer suspended.

by on Sep.19, 2016

Stefan Knirsch is the latest executive to the step down as a result of the ongoing scandal.

The head of R&D for German luxury car brand Audi is the latest to fall as the investigation into parent Volkswagen AG’s diesel emissions scandal moves forward.

An outside investigation commissioned by VW found that Stefan Knirsch, who also served as an Audi board member, knew about efforts to rig diesel engines with a so-called “defeat device,” and then lied about the subterfuge under oath. His suspension, first reported by German newspaper Bild am Sonntag, comes about a week after a U.S.-based Volkswagen engineer became the first company official to plead guilty as part of an expanding investigation by the Justice Department.

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Separately, Justice investigators have begun probing the role of some Volkswagen suppliers, notably including German partsmaker Bosch, to see if they also participated in – or were at least aware of – the emissions test-rigging efforts. Bosch, is high on that list, according to a report by the Bloomberg News Service, as one of the suppliers of emissions technology, including software.


Another Surprise: VW Lands in Global Sales Lead Despite Diesel Drop

Toyota slips to second after production problems.

by on Jul.29, 2016

VW hopes to keep momentum building - despite its diesel woes - with new products like the Alltrack.

A day after reporting a sharp drop in second-quarter earnings, embattled German automaker Volkswagen AG got some good news. Despite its ongoing diesel emissions problems, VW is once again the world’s best-selling automaker – albeit because of a series of unexpected production problems that have been hobbling Japanese giant Toyota in recent months.

Hit by both natural and man-made disasters, Toyota has repeatedly been forced to trim home market production, and the result was a global slide of 0.6% in sales for the first half of 2016, to 4.992 million vehicles. A year earlier, the automaker sold 5.021 million Toyota, Lexus and Daihatsu-branded vehicles from January through June.

By the Numbers!

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 5.116 million cars, trucks and crossovers for the first half of this year, a 1.5% increase.


VW Delivers Profitable Surprise

Earnings “significantly higher” despite diesel scandal.

by on Jul.20, 2016

Regaining momentum: VW delivers a strong, first-half profit despite the costs of its diesel scandal.

Volkswagen AG beat its earnings forecast for the first half of 2016, delivering “significantly higher” profits even while setting aside another 2.2 billion euros, or $2.4 billion, to cover the growing cost of its diesel emissions scandal.

The news comes a day after New York and two other states filed suit against the embattled German maker, claiming senior executives had helped cover up the diesel emissions subterfuge. Last month, VW agreed to a $14.7 billion settlement covering its 2.0-liter diesel, a deal that includes $10 billion to buy back nearly 500,000 vehicles.  Most of the funds VW has so far committed to settle what it calls the “diesel issue” came out of 2015 earnings, however.

By the Numbers!

For the first half of 2016, VW said it had an operating profit of 7.5 billion euros, or $8.25 billion. That would drop to 5.3 billion euros after factoring in the latest charges for the emissions scandal, money largely related to legal costs in North America.


New Legal Problems for VW, as NY, Other States File Suit

Three states bring new civil lawsuits over diesel emissions cheating.

by on Jul.19, 2016

The NY lawsuit claims that former VW CEO Martin Winterkorn helped cover-up the diesel cheating.

Less than a month after federal and California regulators announced a $14.7 billion settlement with Volkswagen A, New York and two other states have filed their own civil lawsuits charging the maker with covering up the fact that it had cheated on diesel emissions tests.

The new lawsuits could add hundreds of millions of dollars in additional costs to the various settlements VW has been trying to work out. And it could make it all the more difficult for the automaker to put the embarrassing issue behind itself.

Clearing the Air!

The three states contend that VW managers, including former CEO Martin Winterkorn, knowingly covered up evidence of the subterfuge. The maker last September acknowledged it had installed a so-called “defeat device” designed to illegally pass emissions tests with its 2.0-liter diesel engine. It subsequently admitted rigging a 3.0-liter turbodiesel, as well.


VW Planning to Compensate Dealers

Maker tells franchisees it will compensate them for lost business.

by on Jul.18, 2016

VW plans to compensate dealers like Hatfield Volkswagen, of Columbus, OH, for their losses.

Volkswagen appears ready to take another critical step towards resolving its diesel emissions scandal, this time by compensating dealers who have suffered a sharp drop in sales since the scandal was revealed last September.

While the maker hasn’t publicly commented on the plan, news reports indicate the basic details were outlined during a meeting with more than 150 franchised dealers in New Jersey in recent days. The maker intends to hold similar meetings with other dealers around the country.

Breaking News!

A restitution plan would come in the wake of the $14.7 billion settlement VW late last month accepted as part of a deal with U.S. regulators. That package covers only the maker’s rigged 2.0-liter turbodiesel, however. The maker and the government are still working on an agreement covering the bigger, 3.0-liter diesel used in various VW, Audi and Porsche brand products.


California Regulators Reject VW Plan to Repair 3.0-Liter Diesels

German maker still hopes to avoid another buyback program.

by on Jul.14, 2016

The fix would have covered VW and Porsche products - as well as the Audi diesels shown here.

Volkswagen’s plan to recall and repair thousands of vehicles using its rigged 3.0-liter diesel has gotten the thumbs-down from California regulators.

VW late last month agreed to spend $14.7 billion to settle consumer lawsuits and U.S. government allegations that it cheated on emissions tests involving its 2.0-liter turbodiesel. The deal includes plans to buy back about 475,000 of those vehicles sold in the U.S. since 2009. But the German maker said it was working up a fix for the larger 3.0-liter diesel that would eliminate the need for a similar buyback program.

Breaking News!

That proposal has been rejected, according to a letter the California Air Resources Board has sent to VW. It declared that the proposed fix is ” incomplete, substantially deficient, and fall(s) far short of meeting the legal requirements to return these vehicles to the claimed certified configuration.”


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.


Mitsubishi Cheated on Mileage Numbers Since 1991

Probe could reveal significantly more problems.

by on Apr.26, 2016

The Mitsubishi three-diamond logo.

Mitsubishi Motors Corp. today admitted it has been falsifying fuel economy data since 1991, the embattled Japanese automaker’s president adding that an ongoing internal probe could uncover additional cheating.

The investigation was launched earlier this month when inconsistent test data was reported by Nissan Motor Co., which partners with Mitsubishi to produce the Dayz Roox, a microcar sold in Japan. A number of other vehicles sold in Japan have since been implicated.

Keeping Things Honest!

“We don’t know the whole picture and we are in the process of trying to determine that,” Mitsubishi President Tetsuro Aikawa said during a news conference in Tokyo on Tuesday.


Tests Suggest Fiat May Also Have Diesel Emissions Issues

German report raises new concerns about emissions cheating.

by on Apr.25, 2016

The report claims VW was found using software that rolled back emissions controls after 22 minutes.

Fiat may find itself embroiled in the growing scandal surrounding diesel emissions problems.

A report out of Germany suggests the emissions control system on the Italian automaker’s diesel engines may be programmed to allow significantly higher levels of pollution if run for longer than 22 minutes at a time.

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Automakers are coming under increased scrutiny in the wake of the Volkswagen diesel cheating scandal – a crisis that has already cost the German maker at least $18.2 billion and subject it to hundreds of lawsuits and potential criminal charges. Mercedes-Benz parent Daimler AG has launched a probe into its own diesel emissions technology following a request from the U.S. Justice Department. And a number of German automakers have already recalled 630,000 diesels to revise emissions control software.