Another Bad Week For Volkswagen
VW found itself in the news yet again this week after several unflattering stories were released. Since U.S. regulators revealed the car company’s software cheats last year that were designed to mask emissions problems with its diesel engines, the automaker has had a run of bad press.
On a serious note, the New York Times recently launched an investigation
into the company and what executives knew of the emission problem. A devastating
article appeared earlier this week that showed executives, including the
former CEO of VW, knew about the trouble, including the emissions-cheating
software, months before they’ve previously claimed.
According to the Times, Martin Winterkorn (the former CEO), has long claimed that he knew nothing of the emissions-cheating software until several days before the scandal was made public. Unfortunately for Mr. Winterkorn, the Times has evidence indicating that isn’t quite true. In fact, internal memos at VW suggest that Winterkorn and others may have been aware of the problem as far back as May of 2014, 16 months ahead of the announcement. The Times unearthed a document that contains a clear warning that regulators may have found the emissions-cheating device, something that Winterkorn will now need to explain away.
The news is important not only because it demonstrates a complete lack of honesty from VW and its executives over what the company and its leaders knew, but also because there could be legal ramifications. In Germany, public companies are legally obligated to reveal information to shareholders that has the potential to negatively impact share price. In this case, VW shares have plunged since the revelation and Winterkorn appears to have sat on the information for more than a year, something that may lead to yet more lawsuits.
Now for some lighter news, VW was embarrassed this week when some curious sales figure were released. The numbers, which showed substantial drops in auto sales both in the U.S. and in Europe, found that not all of VW products have been as negatively impacted by the recent scandal.
Though many may not realize it, in addition to producing cars, VW also makes and sells spicy sausage, known as currywurst. The currywurst has managed to hold its popularity despite the emissions-cheating scandal as the company revealed it sold more than 7 million currywurst sausages in 2015. To put that into perspective, VW only sold 6.12 million cars and trucks that year. We can only hope the company’s quality control is better with sausages than with vehicles.
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