Volkswagen shares surge on CO2 all-clear

10 Dec 2015 | Author: | No comments yet »

VW says CO2 emissions scandal not as bad as feared.

Volkswagen, which has been on a public relations losing streak in recent months, said Wednesday that one of its admitted sins was not as egregious as the company had originally confessed.

In a case separate from the emissions cheating scandal, the company said that further checks found “slight discrepancies” in only a few models and no evidence of illegal changes to fuel consumption and emissions figures.Berlin: Volkswagen understated carbon dioxide emissions on many fewer vehicles than initially feared, it said on Wednesday, providing some relief to the automaker as it battles a wider diesel emissions scandal affecting up to 11 million cars. Volkswagen said that minor “deviations” were found in nine variants of brand models, including Polo, Scirocco, Jetta, Golf and Passat with an annual production of some 36,000 cars, or less than one percent of the brand’s total production.

VW’s update came as its supervisory board was meeting to discuss progress with the investigations it launched in September after admitting to cheating diesel emissions tests in the United States. Those deviations amount to “a few grams of CO2 on average,” it said. “These model variants will be re-measured by a neutral technical service under the supervision of the appropriate authority by Christmas,” Volkswagen added. But if it is accurate, it means that Volkswagen would have to repay only a small fraction of the 2 billion euros, or $2.2 billion, in tax incentives that the company originally estimated customers in Europe had improperly received from their governments for driving cars with low emissions of greenhouse gases. Volkswagen was plunged into the biggest crisis in its history after the revelation that 11 million of its vehicles had been fitted with devices that switched anti-pollution controls on during tests, but shut off the devices during normal driving. No technical modifications to vehicles will be needed, so that cost “has not been confirmed,” Volkswagen said Wednesday. “Whether we will have a minor economic impact depends on the results of the re-measurement exercise.” Germany’s Federal Motor Transport Authority ordered after Volkswagen’s announcement last month that the CO2 emissions of the models in question be measured anew, and the government said it was sticking to that. “These measurements … will be conducted in full irrespective of the evaluation by VW that is now available,” Transport Ministry spokesman Ingo Strater said. “For an assessment, we will have to wait for these measurements.”

They will not reveal names of those responsible, but may explain why the company failed to find the wrongdoing, two people familiar with the matter said. Whether €2 billion, or a much smaller figure, the money is only a portion of the many billions of dollars Volkswagen could end up spending in repairs, fines and lawsuit settlements over the much bigger scandal it has not been able to explain, or explain away.

Environmental Protection Agency said in September that there were 500,000 problemed diesel Volkswagens in the U.S., which warranted fines up to $18 billion. While understating CO2 emissions was the smaller of the two scandals engulfing VW, some analysts had said it could have a bigger impact on sales, arguing drivers might be more worried about fuel economy than pollution. That is the problem of deceptive software it has admitted installing in more than 11 million diesel cars that was designed to let the cars cheat on emissions tests. However, he kept a “sell” rating on VW shares, forecasting its global sales would fall as much as 4 percent next year in an industry that looks likely to grow by a similar amount.

Ernst-Robert Nouvertne, who runs two VW dealerships near Cologne in Germany, didn’t think Wednesday’s update would greatly restore consumer confidence in the business. “This is all very technical stuff. What the consumer will bear in mind is that VW has fudged emissions data, and I’m certain this will cause us lasting problems with our sales.” VW’s update also raised fresh questions about its handling of its scandals, which have wiped almost a fifth off the value of its preference shares, forced out its long-time CEO and driven it to its first quarterly loss in at least 15 years. Emissions of those models, including the 2.0 litre TDI Golf hatchback and the 2.0 litre TDI Passat, deviated on average by “a few grammes” from what had been declared, corresponding to 0.1-0.2 litres of extra fuel usage per 100 kilometers, it said. Wednesday’s board meeting will also hear from the head of the company’s Audi brand on what steps he plans to take to fix luxury diesel cars fitted with software found to have enabled its engines to evade US emissions limits.

On Thursday here in Wolfsburg, Matthias Müller, the Volkswagen chief executive, will hold his first news conference since the wrongdoing came to light and he was promoted to replace Martin Winterkorn, who resigned a few days after the deception was exposed. For some engines, Volkswagen said it would install a simple plastic part to improve the flow of air into the engine and reduce emissions of nitrogen oxides — the gases that the deceptive software was meant to reduce during testing, but would allow at much higher levels during on-the-road driving. The Kraftfahrt-Bundesamt, the regulatory agency for motor vehicles in Germany, is deliberately starved for resources by political leaders eager to protect the country’s powerful automakers, Mr.

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