Volkswagen Ag, the interim largest automaker in the world, has seen its stock taking a nose dive of almost 20 percent on Monday following its acknowledgement it cheated on emissions tests of diesel-powered models in the United States.
German authorities, concerned about the potential damage affecting its entire automotive industry if the scandal spreads has asked Volkswagen to clear up the matter and decided to call an outside investigator to see if the company rigged the emissions figures in Europe as well. “You will understand that we are worried that the justifiably excellent reputation of the German car industry and in particular that of Volkswagen suffers,” commented German Economy Minister Sigmar Gabriel. The US Environmental Protection Agency (EPA) announced on Friday it had established that VW AG had software written especially to dupe regulators when performing toxic emissions tests and would see fit to impose penalties of up to 18 billion dollars.
According to reports, the US Department of Justice is also on the line now, mulling a criminal investigation and the White House added it was quite concerned” about Volkswagen’s misbehavior. The EPA and California motoring officials have also announced they would probe other diesel vehicles from different manufacturers to see if they also violated the law.
Meanwhile Volkswagen, owner of twelve brands and manufacturer of entry-level Skoda cars to ultra-luxury Bentley and Lamborghini autos, had its shares drop 18.6 percent at the close on Monday, loosing around 14 billion euros from its market cap value.