Volkswagen Scandal Rise To $33 Billion With New Penalty

Volkswagen Scandal Rise To $33 Billion With New Penalty

The Volkswagen Group, dealing with scandals on certain activities, has once again been hit with another fine, now counting the cost of cheating on diesel engine emissions tests. The German carmaker said Tuesday that it had been hit with a new fine relating to failings at its Audi subsidiary, sending the total cost of the scandal to nearly $33 billion.

In 2015, Volkswagen admitted to having cheated on clean air rules with software that made emissions look less toxic than they actually were.

A fine of €800 million ($926 million) was imposed on Audi, taking the total cost to the Volkswagen Group globally to €28.2 billion ($32.7 billion). That includes fines and other penalties, payments to authorities and the cost of compensation and retrofitting vehicles, according to a company spokesperson.

There could be yet more costs to come. Volkswagen is still facing a number of lawsuits, including one by shareholders in Germany who are claiming the company misled them. They’re demanding more than €9 billion ($10.4 billion) in damages.

On Tuesday, Volkswagen said it accepted the fine imposed by German prosecutors, waving its right to appeal. Volkswagen said the penalty would hit earnings this year. “As a negative special item, [it will] reduce the group earnings for fiscal year 2018 accordingly.”

The €800 million fine comprises a €5 million penalty for administrative offenses, the maximum allowed under German law. In addition to that, prosecutors ordered Volkswagen to repay €795 million they said the company made from the cheating. The prosecutors said this included profits from the sales of affected vehicles.

Related posts

Leave a Reply

Your email address will not be published. Required fields are marked *