Volkswagen AG lost about 15-billion euros (USD$16.9-billion) in its market value Monday following allegations that the German automaker cheated to pass U.S. emissions testing with its diesel cars.
After half a day of trading on the German stock exchange, VW stock dropped 19.3 percent to a three-year low of 130.20 euros. Volkswagen is facing a crisis after it was alleged that it used illegal software that made it easier for its diesel cars to pass U.S. emissions testing. The software was used on about 500,000 cars, and the result of this cheat is that that the affected cars actually produce up to 40 times more harmful nitrous oxides while driving than the amount recorded during the testing.
Over the weekend, Dr. Martin Winterkorn, CEO of Volkswagen AG, said, “I personally am deeply sorry that we have broken the trust of our customers and the public.” VW has ordered an external investigation.
Volkswagen has already issued a stop-sale for its U.S. dealers to halt sales of remaining 2015 models with 2.0-liter TDI four-cylinder engines and affected 2016 models. This is the first step before a massive recall, and the Environmental Protection Agency (EPA) said the automaker could be fined up to $18-billion.
So far, models affected by the issue include the 2009-2015 Volkswagen Jetta, Beetle and Golf. The 2009-2015 Audi A3 is also affected, along with the 2014-2015 Passat. Diesel cars make up about a quarter of Volkswagen’s sales.
[Source: CTV News]
Discuss this story at our Volkswagen Forum