Volkswagen emissions problem

The scope of the latest Volkswagen emissions scandal is more limited than initially thought.

The hits keep coming for beleaguered automaker Volkswagen. Still reeling from the fallout of “Dieselgate,” the company is now faced with a fresh scandal related to carbon dioxide emissions. This time around, however, the company says the scope of the problem is much smaller than initially feared.

The latest blow to Europe’s largest automaker landed when the company announced its own investigations uncovered understated fuel consumption in some models. That, in turn, also meant its carbon dioxide (CO2) emissions statements were off. The company, which also owns Audi and Porsche, initially feared the problem affected about 800,000 vehicles. It has now said the issue involves only about 36,000 vehicles.

Volkswagen insists the understatements were unintended. Its investigation evidently failed to turn up any evidence of illegal tampering with CO2 emissions data. Analysts see the finding as a bit of a positive for the company that has been under heavy fire since its first scandal broke in September.

“Dieselgate,” as it has been called in the media, centers on an emissions cheating that was first discovered in the United States with concerns then spreading worldwide. Ultimately, those falsified diesel emissions findings are believed to affect around 11 million vehicles produced under the Volkswagen umbrella.


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Fallout from the September scandal has hit the automaker hard. Global sales in November were 2.2% lower than the previous year with steep dips in sales reported in the United States and elsewhere. Overall, the company delivered 833,700 vehicles worldwide in November, down from 852, 900 in November 2014. While true confirmation of emissions test cheating on diesel models has only come from the U.S., the company has announced it will recall some 8.5 million cars across Europe to fix emission systems.

Dieselgate is anticipated to cost the company billions to remedy. Already, Volkswagen has set aside about 6.7 billion euros to cover the anticipated costs. Analysts, however, believe the total bill could dramatically top that when lawsuits, vehicle refits and regulatory fines are added into the equation.

As the full impacts of the two scandals continue to present themselves, Volkswagen seems to be rallying. Sales have dipped by that 2.2%, but Volkswagen’s preference shares were up by 7.3% in early December. News that the second scandal was unintended and not particularly widespread is seen by some analysts as a positive. Only time will reveal the full impacts, and if Volkswagen can win back consumer trust to see its sales rebound.

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