Volkswagen chief quits as emissions gloom gathers

BY Richard Summerfield

Volkswagen’s chief executive, Martin Winterkorn, announced his resignation yesterday in light of the increasing scandal around the German car manufacturer’s rigging of emission tests in the US.

Mr Winterkorn’s resignation was a long time coming. Analysts had expected his departure from the firm as soon as the news broke, but Mr Winterkorn remained in his position until Wednesday, only tendering his resignation following an emergency board meeting in the company’s native Germany.

“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” said Mr Winterkorn is a statement released at the conclusion of the meeting. “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 also vowed to prosecute those individuals responsible for the scheme to cheat US anti-pollution testing, though the company has not yet stated how many people were involved or whether their identities are known. A special investigative subcommittee has been established by Volkswagen in order to establish the facts of the case.

Volkswagen has championed diesel vehicles in both Europe and the US. Diesel engines account for just three percent of new cars sold in the US, compared to around half in Europe. Better fuel economy and lower carbon emissions have proven to be key selling points for Volkswagen and the wider automotive industry, however the suggestion that the German manufacturer – and possibly other firms – utilised ‘defeat devices’ to beat emissions tests could have long-term repercussions.

To date, Volkswagen has recalled nearly half a million vehicles in the US alone, setting aside around $7bn to cover costs. However, should it be required to modify the 11 million vehicles worldwide that are believed to have the software responsible for the falsified figures, $7bn would be grossly inadequate. Furthermore, Volkswagen could face fines of more than $18bn from the US Environmental Protection Agency. In addition to the internal probe launched by the company, the US Department of Justice has also launched a criminal investigation that could result in indictments against Volkswagen executives.

News: Volkswagen boss quits over diesel scandal

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