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Volkswagen crisis: chief executive Martin Winterkorn resigns - live Volkswagen crisis: chief executive Martin Winterkorn resigns - live
(35 minutes later)
5.19pm BST17:19
Volkswagen shares recovered some of the losses they have sustained since the emissions scandal broke at the start of the week. They closed 5.19% higher at €111.5, but the company has still lost around €26bn of value following the crisis.
Overall European markets have - mostly - regained some ground, helped by the rebound in VW and comments from European Central Bank president Mario Draghi that the bank was ready to adjust its QE programme if necessary in the light of economic circumstances. He told the European parliament:
The asset purchase programme has sufficient in-built flexibility. We will adjust its size, composition and duration as appropriate, if more monetary policy impulse should become necessary.
With a rebound in commodity prices despite yet more weak Chinese data, the final scores showed:
On Wall Street, the Dow Jones Industrial Average was hit by weak US manufacturing data, which showed growth at a two year low in September, and is currently 106 points or 0.6% lower.
5.06pm BST17:06
Volkswagen’s supervisory board has admitted criminal charges could follow after the revelation of the emissions scandal.
As mentioned earlier it plans to set up a task force to investigate what happened, with external advisors.
It also thanked Martin Winterkorn for his “invaluable contributions” to VW and noted he had no knowledge of the manipulation of emissions data.
And it warned anyone found to have committed wrongdoing would face the consequences. Here is the full statement:
1. The Executive Committee takes this matter extremely seriously. The Executive Committee recognizes not only the economic damage caused, but also the loss of trust among many customers worldwide.
2. The Executive Committee agrees that these incidents need to be clarified with great conviction and that mistakes are corrected. At the same time, the Executive Committee is adamant that it will take the necessary decisive steps to ensure a credible new beginning.
3. The Executive Committee has great respect for Chairman Professor Dr. Winterkorn’s offer to resign his position and to ask that his employment agreement be terminated. The Executive Committee notes that Professor Dr. Winterkorn had no knowledge of the manipulation of emissions data. The Executive Committee has tremendous respect for his willingness to nevertheless assume responsibility and, in so doing, to send a strong signal both internally and externally. Dr. Winterkorn has made invaluable contributions to Volkswagen. The company’s rise to global company is inextricably linked to his name. The Executive Committee thanks Dr. Winterkorn for towering contributions in the past decades and for his willingness to take responsibility in this criticall phase for the company. This attitude is illustrious.
4. Recommendations for new personnel will be presented at the upcoming meeting of the Supervisory Board this Friday.
5. The Executive Committee is expecting further personnel consequences in the next days. The internal Group investigations are continuing at a high tempo. All participants in these proceedings that has resulted in unmeasurable harm for Volkswagen, will be subject to the full consequences.
6. The Executive Committee have decided that the company will voluntarily submit a complaint to the State Prosecutors’ office in Brunswick. In the view of the Executive Committee criminal proceedings may be relevant due to the irregularities. The investigations of the State Prosecutor will be supported in all form from the side of Volkswagen.
7. The Executive Committee proposes that the Supervisory Board of Volkswagen AG create a special committee, under whose leadership further clarifying steps will follow, including the preparation of the necessary consequences. In this regard, the Special Committee would make use of external advice. Further details about this will be decided at the Supervisory Board meeting on Friday.
8. The Executive Committee is aware that coming to terms with the crisis of trust will be a long term task that requires a high degree of consistency and thoroughness.
9. The Executive Committee will work on these tasks together with the employees and the Management Board. Volkswagen is a magnificent company that depends on the efforts of hundreds of thousands of people. We consider it our task that this company regains the trust of our customers in every respect.
Updated at 5.10pm BST
4.37pm BST16:374.37pm BST16:37
Martin Winterkorn had no choice but to go following the discovery of the emissions scandal, says Karl Brauer at auto industry analyst Kelley Blue Book:Martin Winterkorn had no choice but to go following the discovery of the emissions scandal, says Karl Brauer at auto industry analyst Kelley Blue Book:
With more than 20 years at Volkswagen AG, during which he rapidly rose through the ranks to lead the automaker, Winterkorn appeared ready to bask in the glory of seeing VW become the world’s largest automaker.With more than 20 years at Volkswagen AG, during which he rapidly rose through the ranks to lead the automaker, Winterkorn appeared ready to bask in the glory of seeing VW become the world’s largest automaker.
But VW’s intentional, widespread efforts to deceive regulators across the globe suggests a dark side to the company’s growth. This activity has been going on for years, meaning Winterkorn either had full knowledge of the deception, and approved it, or he was negligent in uncovering and stopping it. Either situation reflects poorly on Winterkorn and his leadership skills, and given the tragic impact this scandal will have on VW, his resignation wasn’t just likely, but necessary.But VW’s intentional, widespread efforts to deceive regulators across the globe suggests a dark side to the company’s growth. This activity has been going on for years, meaning Winterkorn either had full knowledge of the deception, and approved it, or he was negligent in uncovering and stopping it. Either situation reflects poorly on Winterkorn and his leadership skills, and given the tragic impact this scandal will have on VW, his resignation wasn’t just likely, but necessary.
4.31pm BST16:314.31pm BST16:31
Volkswagen says it will create a task force with an external advisor to look into the emissions scandal.Volkswagen says it will create a task force with an external advisor to look into the emissions scandal.
Further heads are likely to roll after Martin Winterkorn’s resignation, with more news expected after Friday’s board meeting.Further heads are likely to roll after Martin Winterkorn’s resignation, with more news expected after Friday’s board meeting.
Volkswagen Says: Greatly Respect CEO Martin Winterkorn's DecisionVolkswagen Says: Greatly Respect CEO Martin Winterkorn's Decision
Volkswagen Says: Expect Further Personnel Consequences In Coming DaysVolkswagen Says: Expect Further Personnel Consequences In Coming Days
Volkswagen Says: To Discuss New Personnel Proposals On FridayVolkswagen Says: To Discuss New Personnel Proposals On Friday
Volkswagen Says: Creating Task Force To Clear up CaseVolkswagen Says: Creating Task Force To Clear up Case
Volkswagen Says: Task Force Will Include External AdvisorVolkswagen Says: Task Force Will Include External Advisor
Updated at 4.37pm BSTUpdated at 4.37pm BST
4.23pm BST16:234.23pm BST16:23
No word either on any compensation for Winterkorn. Which if it happens is likely be be controversial, to say the least.No word either on any compensation for Winterkorn. Which if it happens is likely be be controversial, to say the least.
4.23pm BST16:234.23pm BST16:23
No news yet on a successor to Winterkorn, although reports on Tuesday suggested he could be replaced by Matthias Müller, the current chief executive of Porsche. This was denied at the time.No news yet on a successor to Winterkorn, although reports on Tuesday suggested he could be replaced by Matthias Müller, the current chief executive of Porsche. This was denied at the time.
4.16pm BST16:164.16pm BST16:16
Volkswagen shares have reacted favourably to the news of Winterkorn’s departure, with investors perhaps sensing there could indeed now be a fresh start as he suggested.Volkswagen shares have reacted favourably to the news of Winterkorn’s departure, with investors perhaps sensing there could indeed now be a fresh start as he suggested.
Up around 5% before the news, they now stand 8.35% higher at €114.Up around 5% before the news, they now stand 8.35% higher at €114.
4.14pm BST16:144.14pm BST16:14
The news of Winterkorn’s resignation comes a day after he vowed to stay on and repair the damage from the emissions scandal which has rocked the company and the motor industry.The news of Winterkorn’s resignation comes a day after he vowed to stay on and repair the damage from the emissions scandal which has rocked the company and the motor industry.
A meeting of the supervisory board today seems to have sealed his fate. It’s hard to know which would have been worse: him knowing about the falsification of emission tests, or him not knowing.A meeting of the supervisory board today seems to have sealed his fate. It’s hard to know which would have been worse: him knowing about the falsification of emission tests, or him not knowing.
Someone has to take the fall in situations like this...and the buck does often stop w/ the CEO... #VolkswagenSomeone has to take the fall in situations like this...and the buck does often stop w/ the CEO... #Volkswagen
4.03pm BST16:034.03pm BST16:03
Here’s the full statement from WInterkorn:Here’s the full statement from WInterkorn:
“I am shocked by the events of the past few days. Above all, I am stunned that misconduct on such a scale was possible in the Volkswagen Group.“I am shocked by the events of the past few days. Above all, I am stunned that misconduct on such a scale was possible in the Volkswagen Group.
As CEO I accept responsibility for the irregularities that have been found in diesel engines and have therefore requested the Supervisory Board to agree on terminating my function as CEO of the Volkswagen Group. I am doing this in the interests of the company even though I am not aware of any wrongdoing on my part.As CEO I accept responsibility for the irregularities that have been found in diesel engines and have therefore requested the Supervisory Board to agree on terminating my function as CEO of the Volkswagen Group. I am doing this in the interests of the company even though I am not aware of any wrongdoing on my part.
Volkswagen needs a fresh start - also in terms of personnel. I am clearing the way for this fresh start with my resignation.Volkswagen needs a fresh start - also in terms of personnel. I am clearing the way for this fresh start with my resignation.
I have always been driven by my desire to serve this company, especially our customers and employees. Volkswagen has been, is and will always be my life.I have always been driven by my desire to serve this company, especially our customers and employees. Volkswagen has been, is and will always be my life.
The process of clarification and transparency must continue. This is the only way to win back trust. I am convinced that the Volkswagen Group and its team will overcome this grave crisis.”The process of clarification and transparency must continue. This is the only way to win back trust. I am convinced that the Volkswagen Group and its team will overcome this grave crisis.”
4.01pm BST16:014.01pm BST16:01
VW boss goesVW boss goes
VW chief executive Martin WInterkorn has resigned over the emissions scandal.VW chief executive Martin WInterkorn has resigned over the emissions scandal.
3.41pm BST15:413.41pm BST15:41
BREAKING NEWSBREAKING NEWS
Volkswagen will reportedly hold a press event. shortly.Volkswagen will reportedly hold a press event. shortly.
JUST IN: Volkswagen to hold news event momentarily; no other details provided.JUST IN: Volkswagen to hold news event momentarily; no other details provided.
An earlier tweet suggesting the event was in London has been deleted.An earlier tweet suggesting the event was in London has been deleted.
Updated at 3.58pm BSTUpdated at 3.58pm BST
3.36pm BST15:363.36pm BST15:36
More fallout from the VW scandal: platinum has dropped to a six and a half year low.More fallout from the VW scandal: platinum has dropped to a six and a half year low.
The metal is used in diesel catalysts to clean up emissions, but obviously with the VW crisis, there could be less demand in future for diesel cars. It fell as low as $925.3 an ounce - its lowest since January 2009 - before recovering to $930.5, down 0.6%.The metal is used in diesel catalysts to clean up emissions, but obviously with the VW crisis, there could be less demand in future for diesel cars. It fell as low as $925.3 an ounce - its lowest since January 2009 - before recovering to $930.5, down 0.6%.
3.23pm BST15:233.23pm BST15:23
Fitch: VW's reputation will be hurt badlyFitch: VW's reputation will be hurt badly
Fitch does makes some serious points about Volkswagen’s crisis, as it puts the company on rating watch negative - the first step to a downgrade.Fitch does makes some serious points about Volkswagen’s crisis, as it puts the company on rating watch negative - the first step to a downgrade.
It says the rating actionIt says the rating action
2.55pm BST14:552.55pm BST14:55
Quick out of the blocks as ever, rating agency Fitch has just concluded that it might cut Volkswagen’s credit rating over this scandal.Quick out of the blocks as ever, rating agency Fitch has just concluded that it might cut Volkswagen’s credit rating over this scandal.
JUST IN: Fitch places Volkswagen on credit watch negative.JUST IN: Fitch places Volkswagen on credit watch negative.
Fitch picks up Saturday's newspaper https://t.co/onhwaIcTEdFitch picks up Saturday's newspaper https://t.co/onhwaIcTEd
Updated at 2.56pm BSTUpdated at 2.56pm BST
2.50pm BST14:502.50pm BST14:50
Lawyers: VW could face huge consumer claim in UKLawyers: VW could face huge consumer claim in UK
Volkswagen could face one of the biggest legal claims from UK consumers ever, say lawyers.Volkswagen could face one of the biggest legal claims from UK consumers ever, say lawyers.
Boz Michelowska, a partner and consumer goods expert at law firm Leigh Day, believes legal cases could be brought in Britain if VW vehicles here were able to bypass the European emissions tests.Boz Michelowska, a partner and consumer goods expert at law firm Leigh Day, believes legal cases could be brought in Britain if VW vehicles here were able to bypass the European emissions tests.
Michelowska explains:Michelowska explains:
“If it is shown that this piece of software defeated the European testing then Volkswagen would be in a very similar position as in the US and may well then have to call in their cars with all the resulting costs involved.“If it is shown that this piece of software defeated the European testing then Volkswagen would be in a very similar position as in the US and may well then have to call in their cars with all the resulting costs involved.
“This could well lead to one of the largest group claims ever in this country against Volkswagen for the way in which consumers may have been misled in relation to their vehicle.”“This could well lead to one of the largest group claims ever in this country against Volkswagen for the way in which consumers may have been misled in relation to their vehicle.”
Importantly, the new Consumer Rights Act, which comes into force in October, will allow consumers to band together in ‘collective actions’ against companies.Importantly, the new Consumer Rights Act, which comes into force in October, will allow consumers to band together in ‘collective actions’ against companies.
Eleven million VW cars with ‘defeat devices’ were sold worldwide, so it is likely that a significant number were bought by UK drivers.Eleven million VW cars with ‘defeat devices’ were sold worldwide, so it is likely that a significant number were bought by UK drivers.
And anyone who owns a VW diesel could suffer financially from this crisis. The resale value of their vehicles is unlikely to have risen, after all.And anyone who owns a VW diesel could suffer financially from this crisis. The resale value of their vehicles is unlikely to have risen, after all.
There’s not much precedent for a claim of this type. Leigh Day suggests problems with faulty hip replacements in the UK; a serious problem, but one which only affects tens of thousands of people.There’s not much precedent for a claim of this type. Leigh Day suggests problems with faulty hip replacements in the UK; a serious problem, but one which only affects tens of thousands of people.
UK lawyers say #Volkswagen scandal could see largest group claim in UK legal history http://t.co/fR50iq2B96 pic.twitter.com/mFuyIdabuGUK lawyers say #Volkswagen scandal could see largest group claim in UK legal history http://t.co/fR50iq2B96 pic.twitter.com/mFuyIdabuG
Updated at 2.52pm BSTUpdated at 2.52pm BST
2.17pm BST14:172.17pm BST14:17
Back in Germany, prosecutors have said they are conducting a preliminary investigation into Volkswagen.Back in Germany, prosecutors have said they are conducting a preliminary investigation into Volkswagen.
Reuters has the details:Reuters has the details:
Prosecutors of the German state Niedersachsen said in a statement they were looking into an investigation against Volkswagen employees as they had received a number of criminal complaints from citizens.Prosecutors of the German state Niedersachsen said in a statement they were looking into an investigation against Volkswagen employees as they had received a number of criminal complaints from citizens.
2.05pm BST14:052.05pm BST14:05
Heads-up. Mario Draghi, president of the European Central Bank, is about to testify to MEPs at the European Parliament. Here’s a livefeed.Heads-up. Mario Draghi, president of the European Central Bank, is about to testify to MEPs at the European Parliament. Here’s a livefeed.
Draghi is unlikely to touch on the Volkswagen scandal (alas), but may make some important points about the eurozone economy, and the prospect of further stimulus measures.Draghi is unlikely to touch on the Volkswagen scandal (alas), but may make some important points about the eurozone economy, and the prospect of further stimulus measures.
Updated at 2.13pm BSTUpdated at 2.13pm BST
2.00pm BST14:002.00pm BST14:00
1.39pm BST13:391.39pm BST13:39
The damage to VW’s market value this week is quite staggering:The damage to VW’s market value this week is quite staggering:
VW's €22.6bn loss in market cap exceeds Renault's total market value (20bn) & almost matches Fiat Chrysler's & Peugeot combined (26.5bn)VW's €22.6bn loss in market cap exceeds Renault's total market value (20bn) & almost matches Fiat Chrysler's & Peugeot combined (26.5bn)
1.07pm BST13:071.07pm BST13:07
Germany’s financial watchdog, Bafin, is conducting a ‘routine’ investigation into the slump in Volkswagen’s shares this week.Germany’s financial watchdog, Bafin, is conducting a ‘routine’ investigation into the slump in Volkswagen’s shares this week.
The probe will look into whether VW released market-sensitive information in a timely manner.The probe will look into whether VW released market-sensitive information in a timely manner.
The company’s shares slid 19% on Monday, after US authorities accused it of cheating on emissions tests last Friday, and forced it to recall 482,000 cars.The company’s shares slid 19% on Monday, after US authorities accused it of cheating on emissions tests last Friday, and forced it to recall 482,000 cars.
However it didn’t announce until late Tuesday morning that 11 million vehicles were affected, triggering a second share slump.However it didn’t announce until late Tuesday morning that 11 million vehicles were affected, triggering a second share slump.
12.43pm BST12:4312.43pm BST12:43
German minister denies Greens' claims over VWGerman minister denies Greens' claims over VW
Back in Berlin, transport minister Alexander Dobrindt has denied knowing that German carmakers were rigging emission tests (as claimed earlier)Back in Berlin, transport minister Alexander Dobrindt has denied knowing that German carmakers were rigging emission tests (as claimed earlier)
He told reporters:He told reporters:
“I have made it very clear ... that the allegations of the Greens party are false and inappropriate.“I have made it very clear ... that the allegations of the Greens party are false and inappropriate.
“We are trying to clear up this case. Volkswagen has to win back confidence.”“We are trying to clear up this case. Volkswagen has to win back confidence.”
Updated at 1.27pm BSTUpdated at 1.27pm BST
12.38pm BST12:3812.38pm BST12:38
France’s energy minister Segolene Royal has vowed that Paris will be “extremely thorough, extremely severe” line with Volkswagen.France’s energy minister Segolene Royal has vowed that Paris will be “extremely thorough, extremely severe” line with Volkswagen.
She told reporters that it was unacceptable to sell vehicles whose environmental credentials were false:She told reporters that it was unacceptable to sell vehicles whose environmental credentials were false:
The victims are workers whose situation has been made more precarious, consumers who were duped and also the state which pays subsidies for purchases of clean vehicles.”The victims are workers whose situation has been made more precarious, consumers who were duped and also the state which pays subsidies for purchases of clean vehicles.”
12.13pm BST12:1312.13pm BST12:13
How much did Berlin know?How much did Berlin know?
The Germany government is being dragged into the VW scandal, and faces accusations that it knew that carmakers could falsify emissions data.The Germany government is being dragged into the VW scandal, and faces accusations that it knew that carmakers could falsify emissions data.
It’s emerged that the transport ministry mentioned the issue in July, in response to a question from the Green party.It’s emerged that the transport ministry mentioned the issue in July, in response to a question from the Green party.
The Financial Times has a good take:The Financial Times has a good take:
In a written response to a question from the Green party, the German transport ministry said: “The federal government is aware of [defeat devices], which have the goal of [test] cycle detection.”In a written response to a question from the Green party, the German transport ministry said: “The federal government is aware of [defeat devices], which have the goal of [test] cycle detection.”
The Greens asked if the ministry was aware of the deployment of defeat device software in new vehicles, and it replied: “We have no knowledge of this.”The Greens asked if the ministry was aware of the deployment of defeat device software in new vehicles, and it replied: “We have no knowledge of this.”
There was no specific question about VW and defeat device software from the Greens, and the ministry did not refer to the company.There was no specific question about VW and defeat device software from the Greens, and the ministry did not refer to the company.
However, the ministry answered the question on July 28, prompting accusations that Berlin had been aware of the potential for cheating in the industry for months.However, the ministry answered the question on July 28, prompting accusations that Berlin had been aware of the potential for cheating in the industry for months.
The ministry added that it shared the European commission’s view that there are “no extensively proven means of preventing defeat devices”.The ministry added that it shared the European commission’s view that there are “no extensively proven means of preventing defeat devices”.
Defeat devices are the software used by VW to cut how much NOx gases were pumped out during an emissions test.Defeat devices are the software used by VW to cut how much NOx gases were pumped out during an emissions test.
Berlin finds itself caught up in Volkswagen scandal https://t.co/d4Tlf6ROR9 via @FTBerlin finds itself caught up in Volkswagen scandal https://t.co/d4Tlf6ROR9 via @FT
The Green party now claims that Angela Merkel’s government knew more than it has admitted.The Green party now claims that Angela Merkel’s government knew more than it has admitted.
Oliver Krischer, Green party deputy leader, told the N24 TV station last night that:Oliver Krischer, Green party deputy leader, told the N24 TV station last night that:
The government told us in July that it knew about this software that has been used in the USA, and they clearly knew that the software was widely in use.The government told us in July that it knew about this software that has been used in the USA, and they clearly knew that the software was widely in use.
The government worked together with the auto industry, not to ensure that the emissions levels were reduced, but so that the measuring system was set up in such a way that on paper the cars met the necessary standards.The government worked together with the auto industry, not to ensure that the emissions levels were reduced, but so that the measuring system was set up in such a way that on paper the cars met the necessary standards.
Updated at 12.29pm BSTUpdated at 12.29pm BST
11.56am BST11:5611.56am BST11:56
Nobody knows how bad this crisis could become, says Saxo Bank’s head of equity strategy, Peter Garnry.Nobody knows how bad this crisis could become, says Saxo Bank’s head of equity strategy, Peter Garnry.
For a start, Volkswagen hasn’t put aside enough money to cover the costs. Yesterday it announced a provision of €6.5bn, which is dwarfed by its potential fine from US regulators, which could hit $20bn.For a start, Volkswagen hasn’t put aside enough money to cover the costs. Yesterday it announced a provision of €6.5bn, which is dwarfed by its potential fine from US regulators, which could hit $20bn.
Garnry adds that this is no longer just an isolated case in the US - given this software was installed on 11m vehicles worldwide, not just half a million in America.Garnry adds that this is no longer just an isolated case in the US - given this software was installed on 11m vehicles worldwide, not just half a million in America.
Also, is this an issue that extends across the industry?Also, is this an issue that extends across the industry?
Why should Volkswagen be the only one? If they were the only one who cheated on the emission data they would be standing out from the competition so much that everyone would be wondering, but they’re not.Why should Volkswagen be the only one? If they were the only one who cheated on the emission data they would be standing out from the competition so much that everyone would be wondering, but they’re not.
Here’s Garnry’s video interview on Volkswagen.Here’s Garnry’s video interview on Volkswagen.
Updated at 12.30pm BSTUpdated at 12.30pm BST
11.41am BST11:4111.41am BST11:41
Updated at 12.31pm BSTUpdated at 12.31pm BST
11.17am BST11:1711.17am BST11:17
This scandal could have very serious consequences for the German city of Wolfsburg, which was created in the 1930s to build the Beetle.This scandal could have very serious consequences for the German city of Wolfsburg, which was created in the 1930s to build the Beetle.
Bloomberg reports:Bloomberg reports:
‘If you’d visualise traffic in and out of the city, it would look like a pulse and the heart is the VW plant,’ cab driver Karsten Raabe says as he steers his Skoda by the sprawling complex, where hundreds of gleaming cars sit in parking lots and on the back of freight trains.‘If you’d visualise traffic in and out of the city, it would look like a pulse and the heart is the VW plant,’ cab driver Karsten Raabe says as he steers his Skoda by the sprawling complex, where hundreds of gleaming cars sit in parking lots and on the back of freight trains.
‘Without VW, this city and the entire region would die. We’d become a European Detroit,’ which declared the biggest US municipal bankruptcy in 2013.‘Without VW, this city and the entire region would die. We’d become a European Detroit,’ which declared the biggest US municipal bankruptcy in 2013.
The town has already taken one hammering this week; Wolfsburg was on the wrong end of a 5-1 defeat to Bayern Munich last night.The town has already taken one hammering this week; Wolfsburg was on the wrong end of a 5-1 defeat to Bayern Munich last night.
Wolfsburg is #Volkswagen's home. People there now fear for the future http://t.co/ImJh2EEXiK pic.twitter.com/IS95Q2pCnRWolfsburg is #Volkswagen's home. People there now fear for the future http://t.co/ImJh2EEXiK pic.twitter.com/IS95Q2pCnR
Updated at 12.32pm BSTUpdated at 12.32pm BST
10.48am BST10:4810.48am BST10:48
Some brave investors in Frankfurt are buying into Volkswagen.Some brave investors in Frankfurt are buying into Volkswagen.
This has pushed its share price up around 3% today to €109, a far cry from the €162 on Friday before the emissions bombshell landed.This has pushed its share price up around 3% today to €109, a far cry from the €162 on Friday before the emissions bombshell landed.
Volkswagen shares *finally* go ⬆ again (though they've still lost 32% this week) http://t.co/m5SaEsuXKs pic.twitter.com/EpRhB0S2R5Volkswagen shares *finally* go ⬆ again (though they've still lost 32% this week) http://t.co/m5SaEsuXKs pic.twitter.com/EpRhB0S2R5
10.20am BST10:2010.20am BST10:20
Martin Winterkorn should do the right thing and resign now, argues our finance editor Nils Pratley.Martin Winterkorn should do the right thing and resign now, argues our finance editor Nils Pratley.
Either Winterkorn knew what was going on, or he should have done.Either Winterkorn knew what was going on, or he should have done.
If he knew the company had installed software to cheat US emissions tests, the end of his business career will be the least of his problems. If he didn’t know, he’s failed to do his job properly. Either way, he should have resigned from a well-paid post he has held since 2007.If he knew the company had installed software to cheat US emissions tests, the end of his business career will be the least of his problems. If he didn’t know, he’s failed to do his job properly. Either way, he should have resigned from a well-paid post he has held since 2007.
The scandal also doesn’t reflect well on Germany’s corporate governance, Nils adds:The scandal also doesn’t reflect well on Germany’s corporate governance, Nils adds:
It’s also astonishing that Volkswagen’s supervisory board didn’t insist on an immediate resignation. If this was a UK-listed company – a leading member of the FTSE 100 index – it is safe to say the chief executive would have received his marching orders on day one.It’s also astonishing that Volkswagen’s supervisory board didn’t insist on an immediate resignation. If this was a UK-listed company – a leading member of the FTSE 100 index – it is safe to say the chief executive would have received his marching orders on day one.
Related: Move aside, Martin Winterkorn, and let someone else drive VWRelated: Move aside, Martin Winterkorn, and let someone else drive VW
10.13am BST10:1310.13am BST10:13
VW board holds crisis meetingVW board holds crisis meeting
The executive committee of Volkswagen’s board is meeting now to discuss the crisis that has rocked Germany’s largest carmarker, according to local reports.The executive committee of Volkswagen’s board is meeting now to discuss the crisis that has rocked Germany’s largest carmarker, according to local reports.
Top of the agenda is whether to fire CEO Martin Winterkorn after the company admitted installing software to fool emissions testing in 11m cars, issued a profits warning, and set aside €6.5bn to cover the costs.Top of the agenda is whether to fire CEO Martin Winterkorn after the company admitted installing software to fool emissions testing in 11m cars, issued a profits warning, and set aside €6.5bn to cover the costs.
#VW top brass meeting in undisclosed location in Wolfsburg right now, according to @dpa. Will CEO Martin Winterkorn survive?#VW top brass meeting in undisclosed location in Wolfsburg right now, according to @dpa. Will CEO Martin Winterkorn survive?
The board are certain to grill Winterkorn intensively; how much did he know about the illicit code, and for how long?The board are certain to grill Winterkorn intensively; how much did he know about the illicit code, and for how long?
Winterkorn is famous in the industry for his engineering acumen. He isn’t a beancounter who wouldn’t have been interested in the nitty-gritty of how his cars performed, or how they managed to pass tough US emissions exams.Winterkorn is famous in the industry for his engineering acumen. He isn’t a beancounter who wouldn’t have been interested in the nitty-gritty of how his cars performed, or how they managed to pass tough US emissions exams.
However, the VW board could be reluctant to haul Winterkorn into the pits today, as the scandal is only just unfolding.However, the VW board could be reluctant to haul Winterkorn into the pits today, as the scandal is only just unfolding.
A source familiar with the deliberations has told Reuters that the board is in a “tricky situation”, trying to make a decision without yet knowing the full extent of the CEO’s role in the scandal.A source familiar with the deliberations has told Reuters that the board is in a “tricky situation”, trying to make a decision without yet knowing the full extent of the CEO’s role in the scandal.
Updated at 12.34pm BSTUpdated at 12.34pm BST
9.48am BST09:489.48am BST09:48
VW faces class actionsVW faces class actions
Volkswagen faces the prospect of a massive legal battle over the emissions-fixing scandal, as customers seek redress.Volkswagen faces the prospect of a massive legal battle over the emissions-fixing scandal, as customers seek redress.
Several legal firms have already filed class action lawsuits. The latest is Clifford Law of Chicago, who argues that consumers who bought a VW car have been shortchanged.Several legal firms have already filed class action lawsuits. The latest is Clifford Law of Chicago, who argues that consumers who bought a VW car have been shortchanged.
Sky News has the details:Sky News has the details:
A US law firm has begun a class action lawsuit against Volkswagen over the ‘defeat devices’ used to fool exhaust emissions tests.A US law firm has begun a class action lawsuit against Volkswagen over the ‘defeat devices’ used to fool exhaust emissions tests.
Robert Clifford, partner at Chicago’s Clifford Law, said the impact on consumers was ‘massive’ and that car buyers had not got what they paid for.Robert Clifford, partner at Chicago’s Clifford Law, said the impact on consumers was ‘massive’ and that car buyers had not got what they paid for.
Mr Clifford said people were also affected because of ‘diminution of value’ – meaning their car could now be worth less.Mr Clifford said people were also affected because of ‘diminution of value’ – meaning their car could now be worth less.
The law suit has been filed at a district court in northern Illinois.The law suit has been filed at a district court in northern Illinois.
More here: firm launches Volkswagen emissions lawsuitMore here: firm launches Volkswagen emissions lawsuit
Another law firm, Hagens Berman of Seattle, filed a lawsuit seeking class-action status over the weekend, shortly after VW was accused of cheating on US emission tests.Another law firm, Hagens Berman of Seattle, filed a lawsuit seeking class-action status over the weekend, shortly after VW was accused of cheating on US emission tests.
A Canadian legal outfit, Sutts, Strosberg LLP of Windsor, Ontario, is seeking $1bn in damages and an additional $100m.A Canadian legal outfit, Sutts, Strosberg LLP of Windsor, Ontario, is seeking $1bn in damages and an additional $100m.
Lawyer Harvey Strosberg told a press conference on Tuesday that any Canadian with a Volkswagen diesel car made before September 2015 can add their name to the suit.Lawyer Harvey Strosberg told a press conference on Tuesday that any Canadian with a Volkswagen diesel car made before September 2015 can add their name to the suit.
Faced with this phalanx of m’learned friends, Volkswagen has hired the US law firm Kirkland & Ellis LLP.Faced with this phalanx of m’learned friends, Volkswagen has hired the US law firm Kirkland & Ellis LLP.
Kirkland & Ellis led BP’s defence after the Deepwater Horizon disaster in the Gulf of Mexico. Volkswagen’s emissions scandal is arguably the biggest corporate crisis since BP.Kirkland & Ellis led BP’s defence after the Deepwater Horizon disaster in the Gulf of Mexico. Volkswagen’s emissions scandal is arguably the biggest corporate crisis since BP.
Volkswagen Hires Kirkland & Ellis in Pollution Controls Scandal http://t.co/T6MJ4brpfN via @businessVolkswagen Hires Kirkland & Ellis in Pollution Controls Scandal http://t.co/T6MJ4brpfN via @business
Updated at 12.35pm BSTUpdated at 12.35pm BST
9.30am BST09:309.30am BST09:30
The Volkswagen crisis comes at a tricky time for Europe’s industry, given China’s slowdown.The Volkswagen crisis comes at a tricky time for Europe’s industry, given China’s slowdown.
New data released this morning shows that private sector growth across the eurozone dipped this month, with factory growth at a five-month low. More here.New data released this morning shows that private sector growth across the eurozone dipped this month, with factory growth at a five-month low. More here.
9.13am BST09:139.13am BST09:13
Australia’s stock market has hit a two year-low, following the weak Chinese factory data released this morning:Australia’s stock market has hit a two year-low, following the weak Chinese factory data released this morning:
Took over two years to get here but we're here.. Australia's ASX 200 closes below 5,000 level #Markets #China pic.twitter.com/qxXNpkr9i2Took over two years to get here but we're here.. Australia's ASX 200 closes below 5,000 level #Markets #China pic.twitter.com/qxXNpkr9i2
9.10am BST09:109.10am BST09:10
Volkswagen shares are pretty volatile today. They’re currently flat for the day, after plunging 10% at the open.Volkswagen shares are pretty volatile today. They’re currently flat for the day, after plunging 10% at the open.
It’s almost suspicious.....It’s almost suspicious.....
Traders trying to write VW in shares this morning. Nailed the V http://t.co/VUd5jGur3r pic.twitter.com/g0XePopAbxTraders trying to write VW in shares this morning. Nailed the V http://t.co/VUd5jGur3r pic.twitter.com/g0XePopAbx
8.58am BST08:588.58am BST08:58
“It’s unusual for events in a single company to become a driver of global markets but that’s what is happening now with Volkswagen”.“It’s unusual for events in a single company to become a driver of global markets but that’s what is happening now with Volkswagen”.
So says Kit Juckes, senior strategist at French bank Société Générale, adding:So says Kit Juckes, senior strategist at French bank Société Générale, adding:
The woes of the world’s second-biggest car manufacturer are doing nothing for economic optimism or risk appetite and they are undermining the euro, against both dollar and yen.The woes of the world’s second-biggest car manufacturer are doing nothing for economic optimism or risk appetite and they are undermining the euro, against both dollar and yen.
8.55am BST08:558.55am BST08:55
Over in Paris, shares in Renault and Peugeot have both fallen by over 5%:Over in Paris, shares in Renault and Peugeot have both fallen by over 5%:
Peugeot down 6.3% Renault by 5% - this is contagious!Peugeot down 6.3% Renault by 5% - this is contagious!
8.50am BST08:508.50am BST08:50
VW shares down 8.1% this morning, having fallen 35% in two days. Question: did anyone in the German govt know about the cheating scandal?VW shares down 8.1% this morning, having fallen 35% in two days. Question: did anyone in the German govt know about the cheating scandal?
8.48am BST08:488.48am BST08:48
Volkswagen shares slide in early tradingVolkswagen shares slide in early trading
Volkswagen’s share price fell as much 10% at the start of trading in Frankfurt, before stabilising.Volkswagen’s share price fell as much 10% at the start of trading in Frankfurt, before stabilising.
Investors are try to calculate the full damage that this crisis will cause to the company, ahead of today’s crucial board meeting.Investors are try to calculate the full damage that this crisis will cause to the company, ahead of today’s crucial board meeting.
3rd day of losses for #Volkswagen - shares fell as much as 10% when Frankfurt trading began http://t.co/m5SaEsuXKs pic.twitter.com/1XTkgXwFco3rd day of losses for #Volkswagen - shares fell as much as 10% when Frankfurt trading began http://t.co/m5SaEsuXKs pic.twitter.com/1XTkgXwFco
Other car firms are being dragged down too; reflecting fears that the European auto industry will be dragged into the scandal.Other car firms are being dragged down too; reflecting fears that the European auto industry will be dragged into the scandal.
Updated at 8.48am BSTUpdated at 8.48am BST
8.37am BST08:378.37am BST08:37
Volkswagen’s rigging of emissions tests for 11m cars means they may be responsible for nearly 1m tonnes of air pollution every year.Volkswagen’s rigging of emissions tests for 11m cars means they may be responsible for nearly 1m tonnes of air pollution every year.
That’s roughly the same as the UK’s combined emissions for all power stations, vehicles, industry and agriculture, a Guardian analysis suggests.That’s roughly the same as the UK’s combined emissions for all power stations, vehicles, industry and agriculture, a Guardian analysis suggests.
More here:More here:
Related: VW scandal caused nearly 1m tonnes of extra pollution, analysis showsRelated: VW scandal caused nearly 1m tonnes of extra pollution, analysis shows
8.30am BST08:308.30am BST08:30
Mike Hawes, chief executive of the UK’s Society of Motor Manufacturers and Traders (SMMT), is defending the industry.Mike Hawes, chief executive of the UK’s Society of Motor Manufacturers and Traders (SMMT), is defending the industry.
He tells the Today Programme that Europe is improving its testing system; technology will soon allow cars to be tested on the road, not just in the labs.He tells the Today Programme that Europe is improving its testing system; technology will soon allow cars to be tested on the road, not just in the labs.
[explainer: VW used secret software to turn on its pollution control systems when the car was being tested for emission levels, but turned them off when on the road][explainer: VW used secret software to turn on its pollution control systems when the car was being tested for emission levels, but turned them off when on the road]
But is there a future for diesel, given what we’re now learning?But is there a future for diesel, given what we’re now learning?
Diesels continue to emit 15% fewer carbon emissions than petrol, Hawes says, and the problem of harmful particulates has been solved too.Diesels continue to emit 15% fewer carbon emissions than petrol, Hawes says, and the problem of harmful particulates has been solved too.
But 12,000 people a year could be dying because the car industry has not met emissions levels....But 12,000 people a year could be dying because the car industry has not met emissions levels....
Hawes concedes that the nitrogen oxides, or NOx, gases emitted by diesel cars are a bigger problem for health than first recognised.Hawes concedes that the nitrogen oxides, or NOx, gases emitted by diesel cars are a bigger problem for health than first recognised.
Updated at 8.37am BSTUpdated at 8.37am BST
8.21am BST08:218.21am BST08:21
Consumer trust broken by "The cheater in the room"Consumer trust broken by "The cheater in the room"
Monique Goyens, Director General of BEUC, which represents European Consumer Organisations, is discussing the crisis on the Today Programme now.Monique Goyens, Director General of BEUC, which represents European Consumer Organisations, is discussing the crisis on the Today Programme now.
How much confidence can consumers have in the car industry?How much confidence can consumers have in the car industry?
This is certainly a scandal, but not a surprise to European consumer groups, Goyens says.This is certainly a scandal, but not a surprise to European consumer groups, Goyens says.
This scandal has been allowed to happen because the entire system is flawed. There is no room for independent testing, or on-the-road testing, she explains, adding:This scandal has been allowed to happen because the entire system is flawed. There is no room for independent testing, or on-the-road testing, she explains, adding:
“It does not deserve the consumer’s trust if there is a cheater in the room, which there was in this case.“It does not deserve the consumer’s trust if there is a cheater in the room, which there was in this case.
How could this happen in Europe, though, when cars are being randomly taken off the production line and tested?How could this happen in Europe, though, when cars are being randomly taken off the production line and tested?
Goyens explains that there is a “trend of deregulation” in Europe, which limits the resources given to those who control the market -- be it for cars, food, or financial services.Goyens explains that there is a “trend of deregulation” in Europe, which limits the resources given to those who control the market -- be it for cars, food, or financial services.
“When you limit the resources to the market, you open the safety net and give more room to cheating”“When you limit the resources to the market, you open the safety net and give more room to cheating”
Updated at 8.23am BSTUpdated at 8.23am BST
8.13am BST08:138.13am BST08:13
The VW crisis is a blow to the reputation of Germany’s manufacturing base.The VW crisis is a blow to the reputation of Germany’s manufacturing base.
Professor Karel Williams from Manchester Business School, told Radio 4’s Today Programme that:Professor Karel Williams from Manchester Business School, told Radio 4’s Today Programme that:
Germany has been lecturing the Greeks for years on how they cheated on the budget deficit calculations and now look at this Germany’s largest company is cheating on emissions.Germany has been lecturing the Greeks for years on how they cheated on the budget deficit calculations and now look at this Germany’s largest company is cheating on emissions.
It’s not just a crisis for the company… it is a major set of issues about ineffective regulation as in Libor… and all the rest of that.It’s not just a crisis for the company… it is a major set of issues about ineffective regulation as in Libor… and all the rest of that.
Updated at 8.14am BSTUpdated at 8.14am BST
8.10am BST08:108.10am BST08:10
Germany’s Deutsche Bank has just cut its recommendation on Volkswagen from ‘buy’ to ‘hold’, and slashed its earnings forecasts by up to 35%.Germany’s Deutsche Bank has just cut its recommendation on Volkswagen from ‘buy’ to ‘hold’, and slashed its earnings forecasts by up to 35%.
Deutsche also warned that the full magnitude of the scandal can’t be calculated yet.Deutsche also warned that the full magnitude of the scandal can’t be calculated yet.
The legal fees will be “very painful” but manageable, it says. The impact on VW’s operations, though, could be even tougher.The legal fees will be “very painful” but manageable, it says. The impact on VW’s operations, though, could be even tougher.
. @Volkswagen an "investor's nightmare" says @DeutscheBank, uncertainty on all levels...earnings estimates slashed up to 35% 2015-17. @Volkswagen an "investor's nightmare" says @DeutscheBank, uncertainty on all levels...earnings estimates slashed up to 35% 2015-17
Deutsche has also cut its forecasts for German’s DAX index, which is heavy with auto companies (VW, BMW, Daimler....)Deutsche has also cut its forecasts for German’s DAX index, which is heavy with auto companies (VW, BMW, Daimler....)
8.05am BST08:058.05am BST08:05
Chinese stock market slides after weak factory dataChinese stock market slides after weak factory data
Over in Shanghai, the main Chinese stock market has closed 2% lower after today’s weaker-than-feared factory data.Over in Shanghai, the main Chinese stock market has closed 2% lower after today’s weaker-than-feared factory data.
The news that manufacturing output is falling at the fastest rate since 2009 (see here) spooked traders, and alarmed analysts.The news that manufacturing output is falling at the fastest rate since 2009 (see here) spooked traders, and alarmed analysts.
HSBC economist Frederic Neumann warned:HSBC economist Frederic Neumann warned:
New export orders have really collapsed. It means global trade is facing headwinds, and even China can’t escape thatNew export orders have really collapsed. It means global trade is facing headwinds, and even China can’t escape that
It’s not so bad that we need to hit the alarm button, but the decline in the economy is evident.It’s not so bad that we need to hit the alarm button, but the decline in the economy is evident.
This breakdown of today’s PMI report confirms that the Chinese factory sector is deteriorating:This breakdown of today’s PMI report confirms that the Chinese factory sector is deteriorating:
7.58am BST07:587.58am BST07:58
VW scandal dominates the front pagesVW scandal dominates the front pages
You know your company is facing a crisis when its woes are splashed across the front pages of Britain’s newspapers:You know your company is facing a crisis when its woes are splashed across the front pages of Britain’s newspapers:
Wednesday's Guardian front page: Deal to give homes to 120,000 refugees opens new rifts in EU #tomorrowspaperstoday pic.twitter.com/Zcgg1AuO1QWednesday's Guardian front page: Deal to give homes to 120,000 refugees opens new rifts in EU #tomorrowspaperstoday pic.twitter.com/Zcgg1AuO1Q
Guardian: VW chief Martin Winterkorn defiant over emissions cheating scandalGuardian: VW chief Martin Winterkorn defiant over emissions cheating scandal
Wednesday's Telegraph front page: VW scandal: petrol cars could also be rigged #tomorrowspaperstoday #bbcpapers pic.twitter.com/Xk57VPnxLqWednesday's Telegraph front page: VW scandal: petrol cars could also be rigged #tomorrowspaperstoday #bbcpapers pic.twitter.com/Xk57VPnxLq
Telegraph: Millions of petrol cars could also be rigged in scandalTelegraph: Millions of petrol cars could also be rigged in scandal
Wednesday's FT front page: VW scandal sparks sector turmoil #tomorrowspaperstoday #bbcpapers pic.twitter.com/uFrlCYEKCdWednesday's FT front page: VW scandal sparks sector turmoil #tomorrowspaperstoday #bbcpapers pic.twitter.com/uFrlCYEKCd
FT: Volkswagen shares tumble as inquiries are launched worldwideFT: Volkswagen shares tumble as inquiries are launched worldwide
Wednesday's Times front page: Volkswagen in meltdown after faked diesel tests #tomorrowspaperstoday #bbcpapers pic.twitter.com/l3iGs5Sdc5Wednesday's Times front page: Volkswagen in meltdown after faked diesel tests #tomorrowspaperstoday #bbcpapers pic.twitter.com/l3iGs5Sdc5
The Times: Volkswagen in meltdown after faked diesel testsThe Times: Volkswagen in meltdown after faked diesel tests
Updated at 10.01am BSTUpdated at 10.01am BST
7.50am BST07:507.50am BST07:50
VW CEO's fate could be sealed todayVW CEO's fate could be sealed today
Volkswagen CEO Martin Winterkorn’s fate could be decided today, as the company’s board meets to discuss the crisis.Volkswagen CEO Martin Winterkorn’s fate could be decided today, as the company’s board meets to discuss the crisis.
There are reports that the board began meeting last night, earlier than planned, after chancellor Angela Merkel insisted on ‘full transparency’ into the crisis.There are reports that the board began meeting last night, earlier than planned, after chancellor Angela Merkel insisted on ‘full transparency’ into the crisis.
The board will surely demand to know how much Winterkorn knew about VW’s illicit scheme, which used software to detect when a car was being tested and secretly cut its emissions.The board will surely demand to know how much Winterkorn knew about VW’s illicit scheme, which used software to detect when a car was being tested and secretly cut its emissions.
Bloomberg has some more detail:Bloomberg has some more detail:
The 68-year-old CEO’s survival hangs on convincing a few key power players, including Wolfgang Porsche, head of the family that controls a majority of VW’s voting shares; Bernd Osterloh, VW’s influential labor leader; and Stephan Weil, prime minister of Lower Saxony, which has special blocking rights at the company.The 68-year-old CEO’s survival hangs on convincing a few key power players, including Wolfgang Porsche, head of the family that controls a majority of VW’s voting shares; Bernd Osterloh, VW’s influential labor leader; and Stephan Weil, prime minister of Lower Saxony, which has special blocking rights at the company.
All three are on the committee, which is set to vote on his future.All three are on the committee, which is set to vote on his future.
Updated at 7.50am BSTUpdated at 7.50am BST
7.43am BST07:437.43am BST07:43
Traders in Frankfurt are predicting that Volkswagen’s share price will fall again today, when the market opens in around 20 minutes.Traders in Frankfurt are predicting that Volkswagen’s share price will fall again today, when the market opens in around 20 minutes.
No end to @Volkswagen pain today as stock already trading lower in pre-market...EU27b = 1/3rd wiped off market value last 2 daysNo end to @Volkswagen pain today as stock already trading lower in pre-market...EU27b = 1/3rd wiped off market value last 2 days
7.31am BST07:317.31am BST07:31
Introduction: Chinese jitters and the VW crisisIntroduction: Chinese jitters and the VW crisis
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Two stories are going to dominate today. The unfolding crisis at German carmaker Volkswagen, and fresh fears over China’s economy after more weak economic data overnight.Two stories are going to dominate today. The unfolding crisis at German carmaker Volkswagen, and fresh fears over China’s economy after more weak economic data overnight.
VW’s board are to meet today, with the future of the company in serious doubt after it admitted installing software in 11 million diesel-powered cars to cheat emissions tests.VW’s board are to meet today, with the future of the company in serious doubt after it admitted installing software in 11 million diesel-powered cars to cheat emissions tests.
Overnight, the New York attorney general announced that his office will join the string of investigations into VW, whose share price has crumbled by a third in two days.Overnight, the New York attorney general announced that his office will join the string of investigations into VW, whose share price has crumbled by a third in two days.
CEO Martin Winterkorn is now fighting for his job, after apologising to customers and the authorities yesterday.CEO Martin Winterkorn is now fighting for his job, after apologising to customers and the authorities yesterday.
And with Angela Merkel pushing for answers, and the UK demanding a EU-wide inquiry, the crisis has much further to run.And with Angela Merkel pushing for answers, and the UK demanding a EU-wide inquiry, the crisis has much further to run.
Related: VW chief Martin Winterkorn defiant over emissions cheating scandalRelated: VW chief Martin Winterkorn defiant over emissions cheating scandal
Europe is also bracing for the impact of China’s slowing economy, after factory output across the country fell at the fastest rate since the financial crisisEurope is also bracing for the impact of China’s slowing economy, after factory output across the country fell at the fastest rate since the financial crisis
The preliminary Caixin China PMI dropped to 47.0 in September, from 47.3 in August. That’s the weakest reading since March 2009. Any number below 50 shows a contraction, so this fuels more fears of a Chinese hard landing.The preliminary Caixin China PMI dropped to 47.0 in September, from 47.3 in August. That’s the weakest reading since March 2009. Any number below 50 shows a contraction, so this fuels more fears of a Chinese hard landing.
Also coming up today:Also coming up today:
Updated at 7.36am BSTUpdated at 7.36am BST