VW Adds $2.95B to 'Dieselgate' Scandal Costs

Ann Santiago
September 30, 2017

Volkswagen added provisions of about 2.5 billion euros ($3 billion) on Friday to the mounting total from its diesel emissions scandal, which has already cost the company around 20 billion euros.

Roughly 11 million cars were recalled around the world for using software to cheat emission regulations, but with the majority of those being in Europe, a $3 billion hit for just a small portion of the cars suggest the automaker's woes are far from over, at least on the west side of the Atlantic.

It will be recorded as a negative special item in third-quarter results.

The arrest on Wednesday came after investigators searched two premises, a spokeswoman for the prosecution's office in the southern city of Munich told AFP.

On Thursday, Munich prosecutors said they had arrested a second person in connection with Audi's part in VW Group' emissions scandal but did not name the suspect. The latest charge raises the total USA cost to VW to just under $30 billion.

German media claim the person is Wolfgang Hatz, who stepped down from his post on Porsche's management board a year ago after being suspended over the "dieselgate" investigation. "It shows VW remains some distance from coming through the scandal".

Hatz was head of engine development at Audi from 2001 to 2007, before moving on to lead powertrain development at the VW group and then becoming research and development chief at Porsche, another VW subsidiary. One man has so far been jailed in connection with the scandal: Volkswagen engineer James Liang received a 40 month sentence in a United States court last month. While most of the cars in Europe have been repaired, tougher emissions and fuel economy rules in the US have made the job more hard, the company said.

The company is scheduled to present third-quarter financial results late next month.

At the Frankfurt motor show earlier this month, Volkswagen outlined plans to move away from combustion engines with electrified variants of all 300 models in the 12-brand group's lineup. He declined further comment at an event in suburban Detroit to announce a new longer warranty for VW vehicles.

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