VW Group shares rocketed over 6% this week as the automotive giant took a massive step forward to resolving the emissions cheating controversy by all but agreeing a deal to purchase back 500,000 U.S. diesel cars.
Prosecutors and regulators worldwide have been investigating VW ever since it was caught out in 2015 for installing software in its diesel cars that allowed it to cheat on emissions tests.
The company has been embroiled in controversy ever since and has been the subject of much conjecture regarding how much it would have to pay in fines, with some sources estimating the cheating will cost them over $11,000,000,000.
VW admitted that it had actually been manipulating tests since 2009.
A Positive Deal for Volkswagen
Shareholders and analysts around the world greeted the prospect of a deal with warmth and positivity.
Shares shot up over 6% to 128.6€ a share.
Analyst group Evercore ISI said: “We welcome the fact that Volkswagen appears to be pursuing a broad compensation program.”
Precise details of the buy-back are scant at this present moment, though it is understood it applies to all half a million 2.0-litre diesel VW’s that were embroiled in the controversy.
VW will also put money into an environmental fund, and they will also help to finance green technology initiatives.
There is also no info regarding how much VW will pay customers caught up in the scandal, but it is thought each U.S. customer will be offered around $5,000.
According to VW lawyers: “Volkswagen is committed to winning back the trust of its customers, its dealers, its regulators – and all of America.
These agreements are an important step forward on the road to making things right.”
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