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VW’s Global Sales, Share Weaken in Wake of Diesel Scandal

VW brand gives up “unprecedented” 2 points of market share.

by on Dec.15, 2015

VW is beginning to lose momentum in key markets, including Europe and the U.S.

The emissions testing scandal that’s enveloped Volkswagen is taking a toll on the maker’s global sales and market share – though nowhere is the impact more obvious than in the United States.

The core VW brand saw a 2.4% decline worldwide last month, according to industry numbers, with demand for the first 11 months of 2015 off by 4.5%. That’s all but certain to assure that the maker slips to second place behind Toyota for the full year after briefly surging into the lead in the global sales sweepstakes for the first half of 2015.

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The VW brand gained 2.8% in Europe for November, but it lagged well back of the overall 14% industry upturn as the European market has begun to emerge from more than a half-decade-long downturn. As a result, the entire Volkswagen Group, including such brands as Seat, Skoda, Audi and Bentley, have seen their share of the European market slide from 26.6% in November 2014 to 24.3% last month.

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Reality Setting in for VW – and it Doesn’t Look Good

Costs keep mounting - but company hopes to avert job cuts.

by on Dec.02, 2015

It wasn't all bad news last month; sales of the VW Tiguan jumped nearly 88% in November.

Nearly three months after it was revealed that the German automaker had cheated on diesel emissions testing, Volkswagen is beginning to truly feel the impact of the scandal – and the situation is only likely to get worse for some time to come.

U.S. sales by the Volkswagen brand tumbled by a 24.7% last month, in large part due to a stop-sale of all its diesel models. A federal judicial panel will this week decide how to handle the more than 300 lawsuits already filed against the automaker in the wake of the scandal. And VW has lined up a $21 billion bridge loan it may need to cover the costs it’s expected to incur.

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But at least VW workers have gotten some good news, the families controlling the automaker telling employees at Wolfsburg headquarters they want to protect jobs despite planned cuts in capital spending.

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Justice Dept., VW Both Want Diesel Suits Heard in Detroit

Judicial panel will consider consolidating over 350 lawsuits.

by on Dec.01, 2015

VW and the DoJ want the cases heard in Detroit.

With more than 350 lawsuits already filed against Volkswagen by consumers, investors and dealers alike, a U.S. judicial panel will have to decide this week if, how and where to consolidate them into a single case.

Lawsuits stemming out of Volkswagen’s diesel emissions scandal have so far been filed in 40 states. Hearing them individually could clog up the courts for years, which is why a U.S. Multi-District Litigation panel will meet in New Orleans on Thursday to determine how to proceed.

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In an unusual situation, both Volkswagen and the U.S. Justice Department would like to see the cases taken on by the federal district court in Detroit. But there’s also strong pressure from many of the lawyers suing VW to have a consolidated suit heard in California.

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Volkswagen Engineers Admit Cheating, Feared Failure

Senior VW execs may avoid U.S. travel.

by on Nov.09, 2015

Former VW CEO Martin Winterkorn created a climate of fear encouraging cheating, says paper.

As an internal investigation gets underway, several Volkswagen engineers have acknowledged rigging emissions tests, among other things by adjusting tire settings and using non-standard oil.

A culture of fear may have driven Volkswagen’s emissions test cheating, according to a new report in the German paper, Bild am Sonntag, Volkswagen engineers afraid of what would happen if they couldn’t meet former CEO Martin Winterkorn’s aggressive CO2 targets.

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Meanwhile, a separate report out of Germany indicates some VW managers are now reluctant to come to the U.S. fearing they could get caught up in an ongoing criminal probe by the Justice Department. At least one employee reportedly had his passport taken during a visit to the States.

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Investors Flee VW, Takata

Scandals taking a big financial toll.

by on Nov.05, 2015

Takata's stock is suddenly deflating like a used airbag.

Hammered by safety and emissions scandals, investors are running scared and abandoning auto manufacturing giant Volkswagen AG and industry supplier Takata Corp.

And the exodus has only exited this week in the wake of new problems for the two companies that have raised questions about how VW and Takata will operate going forward. Some analysts are questioning whether VW may have to sell off some of its dozen brands while questions are mounting about whether the Japanese supplier can survive at all.

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Takata was hammered this week by one of the largest fines ever levied by the National Highway Traffic Safety Administration, while VW saw new allegations of cheating on emissions tests by the Environmental Protection Agency.

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VW Shares Take Another Tumble as Maker Accused of More Cheating

Investors worry cost of scandal continuing to mount.

by on Nov.03, 2015

VW could face hefty new fines if the latest allegations of emissions cheating prove true.

Volkswagen investors raced to sell off their shares again Tuesday as new revelations raise the specter that the maker’s already severe diesel emissions cheating scandal could grow worse – and far more costly.

By midday, European time, shares of Volkswagen AG were off about 3.5%, after plunging by 5% at the opening of the day. At the current level, around $109, shares in the German giant will be off by nearly 60% from their peak of $255.20 last March 16th, and the $167.80 they were trading at on September 17th, the day before the EPA first documented Volkswagen’s cheating.

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Yesterday, the U.S. Environmental Protection Agency alleged VW had used a similar approach on a different diesel engine used in luxury cars such as the Porsche Cayenne and Audi A6 – a charge VW denies.

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Porsche Facing More Legal Trouble

Further challenges to VW/Porsche merger.

by on Jan.03, 2012

The takeover attempt crafted by former Porsche CEO Wendelin Wiedeking now haunts the German maker.

A group of investment funds has filed a new lawsuit against Porsche Automobile Holding SE, seeking to recover approximately, $3.2 billion in losses suffered during Porsche’s failed fort to takeover Volkswagen AG in 2008.

The complaint, filed in district court in Stuttgart, alleges Porsche gained control over the price of VW common stock as it secretly built enormous derivative positions covering almost all of VW’s freely traded shares.

In the next step in the scheme, Porsche triggered a massive short squeeze, and finally released billions of Euros worth of shares for its own profit.

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The web site Investopia describes a short squeeze this way: “If a stock starts to rise rapidly, the trend may continue to escalate because the short sellers will likely want out. For example, say a stock rises 15% in one day, those with short positions may be forced to liquidate and cover their position by purchasing the stock. If enough short sellers buy back the stock, the price is pushed even higher.”

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