Report: VW could be preparing discounts for affected cars image

According to a report coming on Sunday from German news agency DPA, Volkswagen could resort to discounting new cars if owners of the affected cars turn in certain older models affected by the massive diesel emissions scandal.

Volkswagen AG, the largest European automaker and the second biggest in the world, has been rocked by a huge scandal – its biggest business crisis in 78 years of existence – after acknowledging it had duped US regulators on diesel emissions tests and also admitted 11 million cars worldwide carried the illegal software. The group now believes the final cost tally of the scandal – which includes a massive recall of 8.5 million autos in Europe – could reach in excess of 30 billion euros ($33 billion), according to recent media reports. The company – which apparently has decided its namesake VW division – the largest by revenue and sales – would bear most of the brunt from the fallout – is now devising strategies to lower expenses and stabilize downward trending sales to emerge from the scandal.

It appears the special discounting promotions would be eligible for vehicles using the 1.6-litre diesel engines, which need expensive hardware upgrades instead of simpler software updates – according to numerous media reports. Apparently the offer would also be limited to its home market of Germany, where a total of 2.4 million autos need to be fixed. The company responded it regularly uses alongside its dealers special promotions for existing customers, refraining from explaining further. The major scandal has so far cost the automaker a quarter of its market value and brought new leadership under new chief executive officer Matthias Mueller.

Via Reuters