VW ad­mits to un­der­stat­ing fuel use

Lesotho Times - - Motoring -

BER­LIN — Volk­swa­gen on Tues­day said it had un­der­stated the fuel con­sump­tion of 800 000 cars sold in Europe, while ma­jor­ity stake­holder Porsche warned that VW’S lat­est find­ings could fur­ther weigh on its re­sults.

The lat­est rev­e­la­tion about fuel econ­omy and car­bon diox­ide emis­sions, which Ger­many’s largest car­maker said rep­re­sented a roughly 2 bil­lion euro (M30.2bn) eco­nomic risk, deep­ened the cri­sis at VW.

The scan­dal ini­tially cen­tered on soft­ware on up to 11 mil­lion diesel ve­hi­cles world­wide that VW ad­mit­ted vastly un­der­stated their ac­tual emis­sions of smog-caus­ing pol­lu­tant ni­tro­gen ox­ide.

US en­vi­ron­men­tal reg­u­la­tors said on Mon­day that sim­i­lar “de­feat de­vices” were in­stalled on larger 3-liter en­gines used in lux­ury SUVS from Porsche and Audi, al­though VW has de­nied those al­le­ga­tions.

Porsche’s North Amer­i­can unit said it was dis­con­tin­u­ing sales of Porsche Cayenne diesels un­til fur­ther no­tice, cit­ing the al­le­ga­tions.

Fuel fig­ures The lat­est find­ings that VW un­der­stated fuel con­sump­tion and car­bon diox­ide emis­sions, ar­eas which US reg­u­la­tors have yet to ad­dress, were dis­closed as VW con­tin­ues a broad re­view of its han­dling of all pol­lu­tion­re­lated is­sues. While the find­ings mostly ap­ply to smaller diesel en­gines, one petrol-pow­ered en­gine is also af­fected.

“VW is leav­ing us all speech­less,” said Arndt Ellinghorst of bank­ing ad­vi­sory firm Ever­core ISI. “It seems to us that this is an­other is­sue trig­gered by VW’S in­ter­nal in­ves­ti­ga­tion and po­ten­tially re­lated to Europe.”

The car­maker said it would im­me­di­ately start talk­ing to “re­spon­si­ble author­i­ties” about what to do about the lat­est find­ings.

“From the very start I have pushed hard for the re­lent­less and com­pre­hen­sive clar­i­fi­ca­tion of events,” Volk­swa­gen Chief Ex­ec­u­tive Matthias Mueller said in a state­ment. “We will stop at noth­ing and no­body. This is a painful process but it is our only al­ter­na­tive.”

‘Deeply con­cerned’ The big­gest busi­ness cri­sis in VW’S 78-year his­tory has wiped as much as a third off its stock mar­ket value, forced out long-time CEO Martin Win­terkorn and rocked the mo­tor industry.

“Volk­swa­gen has done a dis­ser­vice to Ger­man industry,” Ul­rich Grillo, the head of the Fed­er­a­tion of Ger­man in­dus­tries, told a con­fer­ence on Tues­day, adding the firm had an obli­ga­tion to the whole industry to clear up the scan­dal quickly.

Ger­man Chan­cel­lor An­gela Merkel and the Euro­pean Com­mis­sion, the Euro­pean Union’s ex­ec­u­tive body, called for clar­ity and trans­parency to clean up the scan­dal.

VW’S su­per­vi­sory board said it is “deeply con­cerned by the dis­cov­ery of the ir­reg­u­lar­i­ties” in­volv­ing CO2 lev­els, and will meet in the “very near fu­ture” on the is­sue.

In the United States, Mary Ni­chols, chair of the Cal­i­for­nia Air Resources Board, which tested Volk­swa­gen’s diesel en­gines, told Reuters on Tues­day that the reg­u­la­tor will likely in­ves­ti­gate the com­pany’s petrol en­gines in Cal­i­for­nia in wake of dis­cov­er­ing the ir­reg­u­lar­i­ties out of Europe.

“The is­sue is the CO2 from all their fleet, not just from diesel ve­hi­cles, and I think we prob­a­bly will have to go back and look at what they’ve been re­port­ing,” she said in Los An­ge­les.

“It’s not clear to me whether this would af­fect the US re­port­ing or only the Euro­pean, and our sys­tems are some­what dif­fer­ent. So that’s just a ques­tion we’re go­ing to have to ask.”

More pres­sure VW is un­der huge pres­sure to iden­tify those re­spon­si­ble for the cheat­ing and fix af­fected ve­hi­cles, and it has come un­der fire from law­mak­ers, in­vestors and an­a­lysts for a slow re­sponse.

Some an­a­lysts and in­vestors crit­i­cised the ap­point­ment of Mueller as group CEO, ques­tion­ing whether a com­pany vet­eran was the right man to lead an over­haul of the busi­ness.

Top play­ers on VW’S su­per­vi­sory board, in­clud­ing the head of Lower Sax­ony, VW’S sec­ond-largest share­holder, are in close con­tact with the car­maker and seek­ing in­for­ma­tion from its top man­age­ment on the lat­est ac­cu­sa­tions by EPA, two sources fa­mil­iar with the mat­ter said on Tues­day.

VW was the only brand of Ger­many’s top car­mak­ers to post lower sales in a grow­ing Ger­man mar­ket in Oc­to­ber, the Fed­eral Mo­tor Trans­port Author­ity (KBA) said on Tues­day.

New reg­is­tra­tions of the VW brand fell 0.7 per­cent while BMW, Porsche, Opel and Mercedes all re­ported higher de­liv­er­ies in a mar­ket that was up 1 per­cent to 278 000 cars.

— Reuters

Volk­swa­gen has ad­mit­ted to un­der­stat­ing the fuel con­sump­tion of 800 000 cars sold in europe.

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