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Is VW Putting the Nail in the Coffin for U.S. Diesels?

Embattled automaker won’t offer new oil-burners in the future.

by on Nov.23, 2016

VW will no longer sell diesels in the U.S., even if it can resolve its TDI emissions problem.

They once accounted for nearly a quarter of the German automaker’s U.S. sales, but going forward, Volkswagen will no longer offer diesels in the U.S. market, according to brand chief Herbert Diess.

As the largest retailer of diesel-powered passenger vehicles in the U.S., VW helped spur a surge of offerings by competitors such as General Motors and Nissan, as well as Mercedes-Benz and BMW. But with diesel sales already on the decline, some analysts question whether VW’s decision will spur other automakers to abandon their “oil-burners,” as well.

The Last Word!

“At the moment we assume that we will offer no new diesel vehicles in the U.S,” Diess told the German  business daily Handelsblatt in an interview following the Tuesday announcement of the maker’s global turnaround plan.

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VW Cutting 30,000 Jobs Worldwide in Wake of Diesel Emissions Scandal

Move is part of broader changes to shift product plans, improve efficiency.

by on Nov.18, 2016

VW CEO Matthias Mueller wants to double the carmaker's profit margin and shift its product mix.

Volkswagen AG will eliminate about 30,000 jobs, the majority of them in Germany, as it struggles to cut costs in the wake of a diesel emissions scandal that some analysts estimate will eventually cost it as much as $30 billion or more.

The cuts are expected to save the embattled automaker about 3.7 billion Euros, or nearly $4 billion annually, according to VW CEO Matthias Mueller. However, the move is meant to do more than simply help cover the costs of the diesel scandal.

Breaking News!

The job cuts are part of “the biggest modernization program in the history of the group’s core brand,” Mueller told reporters during a news conference at VW’s corporate headquarters in Wolfsburg, Germany.  “The VW brand needs a real shake-up,” he added, “and that is exactly what the future pact has turned out to be.”

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VW Chairman Now Under Investigation in Diesel Scandal

Board looks for ways to slash costs to cover billions burns by crisis.

by on Nov.07, 2016

VW Chairman Hans Dieter Poetsch is the latest exec caught up in the diesel emissions scandal.

The trans-Atlantic criminal probe into Volkswagen’s diesel rigging has now targeted the German automaker’s top executive, Chairman Hans Dieter Poetsch, the company confirmed over the weekend.

He joins a number of other senior executives – including ousted CEO Martin Winterkorn – who are facing investigation in the U.S. and Germany for their possible roles in VW’s effort to cheat on diesel emissions tests. Prior to his appointment in September 2015, Poetsch served at VW’s chief financial officer.

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The investigation of Poetsch and two other board members by prosecutors in the city of Braunschweig could complicate efforts by VW to move past the scandal. As TheDetroitBureau.com reported last week, the automaker is moving closer to a settlement covering the second of two diesel engines Volkswagen has admitted rigging. Meanwhile, hoping to offset the roughly $20 billion it has already committed to pay out due to the scandal, VW board members on Friday laid out extensive cost-cutting plans.

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Volkswagen Delivers Solid Profit Despite Diesel Scandal

U.S. buyback program set to get underway.

by on Oct.27, 2016

The Porsche Macan helped drive big profits for the brand - and for parent Volkswagen AG.

As it begins to see its massive diesel scandal fade into the rearview mirror, Volkswagen AG reported Thursday a big jump in third-quarter earnings.

The German maker had a net, after-tax profit of 2.34 billion euros, or $2.55 billion. By comparison, VW went 6.7 billion euros into the red a year ago as it set aside funds to cover fines and legal costs triggered by the revelation it had rigged emissions tests on its 2.0- and 3.0-liter diesel engines.

A Profitable Source of News!

On Tuesday, a judge in San Francisco gave final approval to a nearly $15 settlement with U.S. and California regulators covering the smaller of the two powertrains. That includes up to $10 billion to buy back the 475,000 Audi and Volkswagen brand vehicles sold in the U.S. using that engine. VW says buybacks are likely to begin by mid-November, though the maker still hopes to come up with a technical fix for at least some of those vehicles.

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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.

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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.

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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.

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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.

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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.

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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.

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