Sunday, April 24, 2016
Volkswagen Posts Deep Loss After Taking $18.28 Billion Hit on Emissions Scandal
After selling diesel cars in America that contained software designed to cheat emissions tests, Volkswagen, the German auto manufacturer, delivered a proposed settlement to U.S. federal judge this week to help end their legal battle. The company proposed a buy back or repair of as many as 500,000 diesel vehicles sold in the U.S., while also offering payments to owners. Volkswagen estimates it will cost $18.28 billion in 2015 alone to put the crisis to bed. This will probably increase demand for other competitors in the auto industry, and will decrease demand and customer loyalty for volkswagen.
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This article is an interesting read because before reading it i had no clue that Volkswagen had done this to their diesel vehicles. I am glad that Volkswagen is going to pay for what they have done, and that the government is making sure of it. I believe this could raise the demand for domestic car manufactures because the economy might be losing faith in foreign auto manufactures, especially now that Mitsubishi and Volkswagen have tried to trick the American economy.
ReplyDeleteIts amazing how smart some of these overseas companies are. It makes it interesting to see how they were able get away with this for so long, and how they were able to come up with it. It is a cost to Volkswagen and can really hurt them in the near future.
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