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VW emissions crisis: UK to retest vehicles as owners call in lawyers - as it happened VW emissions crisis: UK to retest vehicles as owners call in lawyers - as it happened
(30 days later)
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Here’s more from London-based law firm Leigh Day on the potential claims for UK customers following the VW emissions scandal. The firm’s Bozena Michalowska-Howells said:Here’s more from London-based law firm Leigh Day on the potential claims for UK customers following the VW emissions scandal. The firm’s Bozena Michalowska-Howells said:
If it emerges that these cars in the UK passed tests because of this software, with emissions higher than legally permitted on the roads, then this is not only a breach of contract but a flagrant breach of EU emissions regulations, which specifically prohibit the use of defeat devices. Consumers are thus entitled to bring claims for compensation directly against VW.If it emerges that these cars in the UK passed tests because of this software, with emissions higher than legally permitted on the roads, then this is not only a breach of contract but a flagrant breach of EU emissions regulations, which specifically prohibit the use of defeat devices. Consumers are thus entitled to bring claims for compensation directly against VW.
In the event of a UK recall, Volkswagen should initiate contact with its customers to make arrangements concerning a repair. Consumers could be entitled to seek compensation for any increased fuel costs, depreciation of vehicle value, out of pocket expenses and costs associated with future repair including potential increases in Road Tax.In the event of a UK recall, Volkswagen should initiate contact with its customers to make arrangements concerning a repair. Consumers could be entitled to seek compensation for any increased fuel costs, depreciation of vehicle value, out of pocket expenses and costs associated with future repair including potential increases in Road Tax.
Those drivers who were charged more for the ‘clean diesel’ version of a vehicle could also be entitled to a refund of the difference in price.Those drivers who were charged more for the ‘clean diesel’ version of a vehicle could also be entitled to a refund of the difference in price.
In the last two days we have been inundated by Volkswagen owners who bought these vehicles specifically because of their alleged reduced fuel emissions and who are outraged by the company’s actions. They are looking to form a group action.In the last two days we have been inundated by Volkswagen owners who bought these vehicles specifically because of their alleged reduced fuel emissions and who are outraged by the company’s actions. They are looking to form a group action.
And as a reminder, here’s our Q&A on how the scandal could affect you if you are a VW car owner:And as a reminder, here’s our Q&A on how the scandal could affect you if you are a VW car owner:
Related: Volkswagen emissions scandal: how it affects youRelated: Volkswagen emissions scandal: how it affects you
On that note, it’s time to close up for the evening. Thanks for all your comments, and we’ll be back again tomorrow.On that note, it’s time to close up for the evening. Thanks for all your comments, and we’ll be back again tomorrow.
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UK motoring organisation the RAC has welcomed the government’s investigation into emissions tests. RAC chief engineer David Bizley said:UK motoring organisation the RAC has welcomed the government’s investigation into emissions tests. RAC chief engineer David Bizley said:
While there is no evidence that other manufacturers have been seeking to defeat emissions tests, news that the Government is launching its own investigation should go some way towards restoring battered consumer confidence.While there is no evidence that other manufacturers have been seeking to defeat emissions tests, news that the Government is launching its own investigation should go some way towards restoring battered consumer confidence.
The VW revelation is now shining an uncomfortable light on the emissions testing system, parts of which have been recognised for some time by all parties to be well past their ‘sell by’ date.The VW revelation is now shining an uncomfortable light on the emissions testing system, parts of which have been recognised for some time by all parties to be well past their ‘sell by’ date.
A new EU test has been in the pipeline for some considerable time, and the expectations are that results will be much closer to real-world driving, but it is unrealistic to think a laboratory test will ever mirror completely a car being driven on a real road by different drivers.A new EU test has been in the pipeline for some considerable time, and the expectations are that results will be much closer to real-world driving, but it is unrealistic to think a laboratory test will ever mirror completely a car being driven on a real road by different drivers.
As this is not due to take effect until 2017 all attention must now be put on ensuring the test cannot be defeated by software so that consumers can be confident in the emissions levels of the vehicles they are buying.As this is not due to take effect until 2017 all attention must now be put on ensuring the test cannot be defeated by software so that consumers can be confident in the emissions levels of the vehicles they are buying.
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With shares in motor manufacturers falling - VW apart - and further declines in commodity prices due to worries about economic growth, particularly in China, it was another down day for stock markets.With shares in motor manufacturers falling - VW apart - and further declines in commodity prices due to worries about economic growth, particularly in China, it was another down day for stock markets.
In the US poor results from Caterpillar added to the gloom, ahead of a speech by Federal Reserve chair Janet Yellen. The final scores showed:In the US poor results from Caterpillar added to the gloom, ahead of a speech by Federal Reserve chair Janet Yellen. The final scores showed:
On Wall Street the Dow Jones Industrial Average is currently down nearly 190 points or just over 1%.On Wall Street the Dow Jones Industrial Average is currently down nearly 190 points or just over 1%.
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BMW leds German stock market lowerBMW leds German stock market lower
Germany’s Dax has closed down 1.9%, hit by the latest concerns about the country’s car manufacturers. BMW led the way lower after a report some of its diesel cars had exceeded emissions standards in tests, although the company said it was unaware of the tests mentioned.Germany’s Dax has closed down 1.9%, hit by the latest concerns about the country’s car manufacturers. BMW led the way lower after a report some of its diesel cars had exceeded emissions standards in tests, although the company said it was unaware of the tests mentioned.
However VW itself edged higher as the company acted to shake up its management in the wake of the scandal.However VW itself edged higher as the company acted to shake up its management in the wake of the scandal.
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Gwyn TophamGwyn Topham
Here’s our report on the UK plans:Here’s our report on the UK plans:
The British government is to set up its own inquiry into car emissions and testing - including rerunning lab tests on suspect engines and conducting on the road emission tests.The British government is to set up its own inquiry into car emissions and testing - including rerunning lab tests on suspect engines and conducting on the road emission tests.
It had called on the European Commission to carry out a Europe-wide investigation into the industry in the wake of the VW test-rigging scandal.It had called on the European Commission to carry out a Europe-wide investigation into the industry in the wake of the VW test-rigging scandal.
The UK’s regulator, the Vehicle Certification Agency - a division of the Department for Transport - will work with manufacturers across the industry.The UK’s regulator, the Vehicle Certification Agency - a division of the Department for Transport - will work with manufacturers across the industry.
Transport secretary, Patrick McLoughlin, said: “The Government takes the unacceptable actions of VW extremely seriously. My priority is to protect the public as we go through the process of investigating what went wrong and what we can do to stop it happening again in the future.Transport secretary, Patrick McLoughlin, said: “The Government takes the unacceptable actions of VW extremely seriously. My priority is to protect the public as we go through the process of investigating what went wrong and what we can do to stop it happening again in the future.
“We have called on the EU to conduct a Europe wide investigation into whether there is evidence that cars here have been fitted with defeat devices. In the meantime we are taking robust action.”“We have called on the EU to conduct a Europe wide investigation into whether there is evidence that cars here have been fitted with defeat devices. In the meantime we are taking robust action.”
He said the VCA would work with vehicle manufacturers to ensure that the issue was limited to VW and not industry wide. “As part of this work they will re-run laboratory tests where necessary and compare them against real world driving emissions.”He said the VCA would work with vehicle manufacturers to ensure that the issue was limited to VW and not industry wide. “As part of this work they will re-run laboratory tests where necessary and compare them against real world driving emissions.”
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UK to retest for emissionsUK to retest for emissions
The UK department for transport says it will start re-testing cars from different manufacturers for emisssions. It says the regulator is working with manufacturers to make sure the VW cases are not an industry wide problem.The UK department for transport says it will start re-testing cars from different manufacturers for emisssions. It says the regulator is working with manufacturers to make sure the VW cases are not an industry wide problem.
Dept for Transport announces it is to start re-testing cars from different manufacturers to ensure #VW scandal "is not industry wide"Dept for Transport announces it is to start re-testing cars from different manufacturers to ensure #VW scandal "is not industry wide"
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Porsche boss to get top VW job - reportPorsche boss to get top VW job - report
Matthias Müller, the chief executive of Porsche, has been the odds-on favourite to become the new boss of Volkswagen to replace Martin Winterkorn and now the Wall Street Journal is reporting that he will indeed get the top job.Matthias Müller, the chief executive of Porsche, has been the odds-on favourite to become the new boss of Volkswagen to replace Martin Winterkorn and now the Wall Street Journal is reporting that he will indeed get the top job.
Breaking: Porsche CEO Matthias Muller to become new Volkswagen CEO, person familiar with the matter says http://t.co/Wen9Ecs6SGBreaking: Porsche CEO Matthias Muller to become new Volkswagen CEO, person familiar with the matter says http://t.co/Wen9Ecs6SG
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And here’s piece of video on the VW scandal, what the company did and why:And here’s piece of video on the VW scandal, what the company did and why:
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And the fallout continues. The European Commission has said there would be “zero tolerance” on car emissions fraud, while the Russian technical watchdog has asked for information from Volkswagen about its diesel engines.And the fallout continues. The European Commission has said there would be “zero tolerance” on car emissions fraud, while the Russian technical watchdog has asked for information from Volkswagen about its diesel engines.
Meanwhile Moody’s is the latest ratings agency to change its outlook on the company to negative.Meanwhile Moody’s is the latest ratings agency to change its outlook on the company to negative.
Moody's affirms Volkswagen's A2/P-1 ratings and changes the outlook to negative following EPA's notice of violation https://t.co/5UGd9sJml4Moody's affirms Volkswagen's A2/P-1 ratings and changes the outlook to negative following EPA's notice of violation https://t.co/5UGd9sJml4
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A reminder of what VW has actually done and how its defeat device managed to cheat emissions tests:A reminder of what VW has actually done and how its defeat device managed to cheat emissions tests:
Related: The Volkswagen emissions scandal explainedRelated: The Volkswagen emissions scandal explained
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Volkswagen needs to change its corporate culture according to the company’s works council (which at this point seems a pretty self evident comment.)Volkswagen needs to change its corporate culture according to the company’s works council (which at this point seems a pretty self evident comment.)
In a letter to employees, the council said it would discuss with management how to cope with the costs arising from the scandal, and how to accelerate its efficiency drive. But it says it will do everything possible to make sure jobs will not be affected.In a letter to employees, the council said it would discuss with management how to cope with the costs arising from the scandal, and how to accelerate its efficiency drive. But it says it will do everything possible to make sure jobs will not be affected.
On the new chief executive to replace Martin Winterkorn, the council said it would only accept someone with technical and entrepreneurial expertise, who would consider the needs of both the company and the employees.On the new chief executive to replace Martin Winterkorn, the council said it would only accept someone with technical and entrepreneurial expertise, who would consider the needs of both the company and the employees.
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If you have bought a VW car in the UK, the company has so far said very little about how the emissions scandal could effect you. Dealers are telling customers it is business as usual. But should you be worried? Here’s our Q&A:If you have bought a VW car in the UK, the company has so far said very little about how the emissions scandal could effect you. Dealers are telling customers it is business as usual. But should you be worried? Here’s our Q&A:
Related: Volkswagen emissions scandal: how it affects youRelated: Volkswagen emissions scandal: how it affects you
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France is planning to carry out tests to make sure cars on its roads are not equipped with the software which VW used to fake emissions tests.France is planning to carry out tests to make sure cars on its roads are not equipped with the software which VW used to fake emissions tests.
After a meeting with carmakers Renault and PSA Peugeot Citroen, the country’s environment minister Segolene Royal told BFM television:After a meeting with carmakers Renault and PSA Peugeot Citroen, the country’s environment minister Segolene Royal told BFM television:
Random tests will take place to establish cars are not equipped with fraudulent software.Random tests will take place to establish cars are not equipped with fraudulent software.
The tests are expected to involve a random sample of around 100 vehicles.The tests are expected to involve a random sample of around 100 vehicles.
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Volkswagen adverts routinely used to boast about the company’s reliability and efficiency, which looks a bit ironic now. Here’s some of the best from the archive:Volkswagen adverts routinely used to boast about the company’s reliability and efficiency, which looks a bit ironic now. Here’s some of the best from the archive:
Related: How Volkswagen relied on clever advertising to build its reputationRelated: How Volkswagen relied on clever advertising to build its reputation
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VW to dismiss three top executives on Friday - reportVW to dismiss three top executives on Friday - report
VW will dismiss the research and development chiefs of Audi and Porsche, and US chief executive Michael Horn, Reuters is reporting.VW will dismiss the research and development chiefs of Audi and Porsche, and US chief executive Michael Horn, Reuters is reporting.
Audi R&D boss Ulrich Hackenberg and Porsche’s Wolfgang Hatz, as well as Horn, will be dismissed at Friday’s supervisory board meeting, a source told Reuters.Audi R&D boss Ulrich Hackenberg and Porsche’s Wolfgang Hatz, as well as Horn, will be dismissed at Friday’s supervisory board meeting, a source told Reuters.
German newspaper Bild earlier reported that Hackenberg and Hatz would go.German newspaper Bild earlier reported that Hackenberg and Hatz would go.
Horn admitted on Monday that VW had “totally screwed up” over the emissions scandal.Horn admitted on Monday that VW had “totally screwed up” over the emissions scandal.
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Volkswagen could have its long term credit rating downgraded in the wake of the €6.5bn charge the company has set aside to deal with the crisis, says Standard & Poor’s.Volkswagen could have its long term credit rating downgraded in the wake of the €6.5bn charge the company has set aside to deal with the crisis, says Standard & Poor’s.
The agency has put VW’s A rating on creditwatch with negative implications, and said it anticipated the company would face substantial penalties and costs to resolve the problem.The agency has put VW’s A rating on creditwatch with negative implications, and said it anticipated the company would face substantial penalties and costs to resolve the problem.
There is also the matter of any legal costs following an expected barrage of lawsuits.There is also the matter of any legal costs following an expected barrage of lawsuits.
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Gwyn Topham
Here’s our report on the possible payoff for the former VW boss who quit on Wednesday:
The former chief executive of Volkswagen, Martin Winterkorn, will net a €1m (£740,000) annual pension from a €28.5m pot held with the disgraced carmaker, and could be in line for a €3.2m payoff after quitting on Wednesday.
Winterkorn, who was one of Europe’s highest-paid executives, with a salary of €1.6m boosted to nearly €16m last year with bonuses and loyalty payments, finally fell on his sword as the extent of the emissions test-rigging scandal emerged.
Winterkorn is entitled to 70% of his fixed salary, according to Volkswagen’s annual report, from his staggering €28.5m pot. He may also be entitled to two years’ salary severance pay if “membership of the board of management is terminated for cause through no fault of the board of management member”. Winterkorn stressed when he resigned that he was “not aware of any wrongdoing on my part”.
Full story here:
Related: VW scandal: outgoing boss's €28m pension pot to pay out €1m a year
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Italy has also opened an investigation into whether VW’s manipulation of emissions data affected cars in the country, the latest probe into the company. It was launched by the prosecutor’s office in Turin.
VW has admitted 11m of its cars around the world could be involved.
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Meanwhile Italy has launched a study into possible health risks associated with diesel emission filters used in cars throughout the EU.
The worries pre-date the current VW scandal but they add to the general mood over uncertainty over diesel. Reuters reports:
The concern over the filters, raised by an Italian prosecutor, pre-dates the Volkswagen emissions scandal and relates to devices which were installed by various car makers from 2008 onwards.
The health ministry decided to investigate the matter after Rome’s chief prosecutor wrote to the government in July, referring to expert opinion alleging the filters increased the risks to health of diesel emissions rather than reducing them, and saying they posed an “extreme danger”.
The letter, obtained by Reuters, was sent by Prosecutor Giuseppe Pignatone to Italy’s ministers for health, transport and the environment. It said the filters reduced the size of pollutant particles, making them more easily absorbed by humans.
The letter is critical of all three ministries and says that the environment ministry has not conducted any studies into the impact of the filters on air quality or human health.
An Italian health ministry spokesman told Reuters the ministry had asked the Superior Health Institute to conduct a study into the matter after receiving Pignatone’s letter.
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Germany’s main stock index, the DAX, has now slumped by 200 points, or 2.1%, to 9,407, as the Volkswagen scandal hits confidence in German industry.
Ironically, VW remains the only riser on the index, with BMW still the top faller despite denying manipulating emissions tests.
Some analysts are speculating that authorities have been deliberately turning a blind eye to emissions tests for years, due to the importance of the sector.
Mike van Dulken, head of research at Accendo Markets explains:
Shares in BMW are weak again today on speculation that its diesel emissions test results may also have been doctored to appear eco-friendly and thus saleable in the world’s second largest but arguably the most important car market; the US. While this adds to this week’s VWgate revelation, confirmation of yet another major carmaker having potentially been ‘at it’ will hardly come as a surprise for such a highly competitive industry.
As more details emerge about the extent to which VW, BMW and likely others may have gone to pull the wool over regulators’ and of course the public’s eyes, it begs the question of how ‘polluted’ the industry will turn out to be.
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Today’s fall in BMW’s share price shows that investors are very nervous about “diesel engines, compliance and future regulation,” Arndt Ellinghorst, head of Automotive Research at Evercore ISI, told Reuters.
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BMW: Our cars don't break emission rules
BMW has insisted that it has not not manipulated emissions tests, following Auto Bild’s claim that some of its vehicles were exceeding legal limits.
A spokesman said the company isn’t aware of these test results cited, adding:
“There is no difference in the treatment of exhaust emissions whether they are on (test) rollers or on the road.
Despite that denial, BMW shares are still down 6%, leading the fallers on the Frankfurt stock exchange. Volkswagen is the only riser, up 1%.
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UK parliament to hold emissions inquiry
Britain’s transport select committee is set to launch an inquiry into the scandal and its wider lessons for testing, which could see ministers and VW executives in Britain hauled before MPs, our transport correspondent Gwyn Topham reports.
While an inquiry cannot be officially launched until Parliament returns in October, Louise Ellmann, chair of the committee, said:
“Action must be taken to give the public confidence in the testing regime in relation to emissions, safety, recyclability and other factors.
There are questions over whether the testing authorities commissioned by motor manufacturers are truly independent.”
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Gwyn Topham
Pressure is growing on the UK government to follow up its call for a European Commission inquiry, after the Guardian revealed that the Department for Transport had been lobbying in private for less rigorous tests.
Environmental law organisation ClientEarth has written to the DfT demanding it take action to establish whether VW’s use of “defeat devices” was part of wider industry practice, and to release all information held on the real-world emissions performance of cars licensed for sale on UK roads.
James Thornton, CEO of ClientEarth, said:
“Five days into the diesel emissions scandal the government has taken no action to reassure the public that cars on our roads meet even the lax standards required by EU law. The industry has shown it cannot be trusted. We cannot wait for action from the EU.
First responsibility for protecting our health lies with our own government. The public must know the full scale of the problem and urgent action must be taken to fix it.”
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Here’s our full guide to the potential candidates for the toughest job in industry today - steering Volkswagen out of the crisis.
Related: Volkswagen's new chief executive: a guide to the contenders
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Matthias Müller, the CEO of Porsche, is odds-on to become the new boss of Volkswagen.
He’s followed by four company insiders, led by Herbert Diess, who runs Volkswagen’s passenger car brand.
Here’s the latest odds from Ladbrokes: