Angela Merkel, Germany’s Chancellor, which has been very supportive of the national automotive industry, has now asked Volkswagen AG – Europe’s biggest automaker – to move quickly and clarify its diesel emissions scandal.
Last month the US Environmental Protection Agency accused VW AG of cheating on diesel emissions tests in the country, with the company admitting to the illegal modifications and also stating up to 11 million vehicles – including 8.5 million in the EU – were sold with the defeat device on board. The scandal has sparked the biggest business crisis in the company’s 78 year history and rocked the entire automotive industry, also forcing out the long running CEo Martin Winterkorn. “There has to be swift transparency so that credibility can be restored,” Merkel commented Wednesday at a labor union event in Frankfurt, saying that Germany’s well deserved reputation was also on the line following the cheating scandal.
Meanwhile, Bernd Osterloh, works council chief and a VW supervisory board member, commented fro German newswire dpa that the board would deliver more detail about the internal review after a special committee ends its investigation on the matter. He also called the management force to review the 2014 strategy proposed by labor leaders that called a refocus of the company on the more profitable cars and cut the 12-brand group’s complexity to limit spending. Newly appointed chief executive officer Matthias Mueller added this month that VW would cancel or postpone all non-essential projects to cut spending as the carmaker now believes the 6.5 billion euros ($7.4 billion) already set aside to cover recall costs would be insufficient.