Volkswagen: Diesel Scam Cleanup Might Cost 2 Billion Euros In 2019

Volkswagen: Diesel Scam Cleanup Might Cost 2 Billion Euros In 2019

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Frank Witter, Chief Financial Officer, Volkswagen (VW), stated in a German newspaper Boersen-Zeitung that the firm’s cleanup of a diesel cheating scam is supposed to cost it about $6.25 Billion in 2018 and almost 2 Billion Euros in 2019. Since 2015, the German carmaker had to compensate an amount of over 27 Billion Euros. Reportedly, this amount was aimed at resolving numerous investor and customer complaints as well as regulatory fines & remedies related to resolving unnecessary emissions levels in the firm’s diesel cars. In 2020, Volkswagen Group is supposed to see costs of almost 1 Billion Euros related to emissions cheating.

In September 2018, Volkswagen went on a trial to face investors asking for about $10.6 Billion in reimbursement, claiming that the firm should have notified shareholders earlier about its diesel emissions scam. Shareholders, representing almost 1,670 claims, hunted compensation for a slide in Volkswagen’s share cost triggered by the scam, which busted in September 2015.

On a similar note, VW came into the news as it revealed that it is purchasing a controlling stake in Volvo’s WirelessCar, a digital service developer specialized in connected driving. This contract was completed for about $122 Million. VW announced that the WirelessCar technology might promote its aim of improving value-added services for its customers. VW is planning to present its customers with secure and consistent data exchange between operating systems in its cars and a cloud platform the firm is designing with Microsoft.

The firm is about to purchase almost 75.1% of WirelessCar shares in the recent contract. This will permit Volvo to target at commercial vehicles, which is its key business since it traded Volvo Cars in 1999. VW stated that it targets to invest over 11 Billion Euros by 2023. This investment will be focused on digitalization, electric vehicles, self-governing driving, and mobility services. However, a bulk amount would be allocated for electric cars.