Hopefully the Final Piece

01.23.17 - Volkswagen CEO Matthias Müller

01.23.17 - Volkswagen CEO Matthias Müller

While the cost to bring most of those responsible for the Volkswagen emissions scandal to the US for prosecution is out of reach, US authorities still have jurisdiction over those executives who work and reside in the US. This scandal led to the arrest of Oliver Schmidt earlier this month. Mr. Schmidt is the Volkswagen executive responsible for regulatory compliance in the US, making him one of the responsible parties for ensuring the cars that came in the States would adhere to the standards set by the EPA, which certainly wasn’t the case at all.

In September of 2015 a research team at a West Virginia university discovered the cheating tech that was being used in the 2.0 and 3.0-liter diesel engines produced by Volkswagen. While we still haven’t seen the final solution for the 3.0-liter models, those who owned a 2.0-liter model have already begun to exchange their old models for new ones that have gasoline engines and are within the emissions guidelines set forth. The cost of this scandal, before any criminal charges were files, we expected to be close to $15 billion. Now that criminal charges have begun to be filed by the US Justice Department this total is likely to increase.

These emissions cheating scandal has been hanging over the head of Volkswagen for several months, leaving many of the employees of the company in the US to wonder what will become of their employment. In an effort to show the commitment to continued relations in the US, VW has subsidized dealers for lost sales, invested heavily in their Tennessee plant and continues to work toward changing the reputation of the company. The look toward a new lineup of electric-powered vehicles shows us the new direction of VW and what they have planned for their future.

Right now the criminal part of the equation could amount to as much as $4.3 billion would bring the total of the diesel scandal to a $20 billion total. This is currently more than VW set aside for the settlement of this scandal but will help to avoid further criminal charges and hopefully finally bring the scandal to a close. In order to reach this agreement, VW has to plea guilty to several criminal charges while making improvements to their compliance systems and be subjected to independent monitoring over the next three years.

As the final part of the scandal that shocked many VW lovers in the US, we might see a closing of the door on this scandal with only a few loose ends to tie up such as what to do with the 3.0-liter models and the continued trading and exchanging of the 2.0-liter diesel engine cars. It will be a relief for VW to get this scandal finally in the rear view mirror and continue to move forward, but the regulatory aspect of this scandal will continue to take place over the next three years to help give us as consumers the confidence we need in the new VW as its presented to us after the scandal.

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