Volkswagen is in the midst of an emissions scandal related to 11 million diesel vehicles around the world, and now they’re setting aside 6.5 billion Euros (9.6 billion dollars Canadian) to deal with the issue.
A “noticeable deviation,” as the German automaker put it, was noted between bench tests of their vehicles and real-world driving due to a software that was installed to make their diesel engines seem more efficient.
Now the company is doing some serious damage control. A statement released by Volkswagen said they will set aside billions of Euros “to cover the necessary service measures and other efforts to win back the trust of [their] customers.” They said the amount of money they set aside might change depending on how the ongoing investigations go.
As such, the funds are strictly for repair work on recalled vehicles and not any other costs related to the scandal.
Volkswagen’s CEO Dr. Martin Winterkorn is apologizing profusely to the public as part of the efforts to regain the confidence of their customers.
“The Board of Management at Volkswagen AG takes these findings very seriously. I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case. Volkswagen has ordered an external investigation of this matter,” Winterkorn said in a statement.
As a result, Volkswagen’s stocks have plummeted more than 36 per cent, and other car companies are feeling the heat as well; BMW’s stock plummeted more than 10 per cent, while Daimler, owners of Mercedes-Benz, fell more than 12 per cent.
Volkswagen Jettas (2009-2015), Golfs (2010-2015), Passats (2012-2015), Beetles (2013-2015) and Golf Sportwagon and Wagons (2009-2015) were all the Canadian cars affected by the manipulative software.
The company said they will keep the public informed as the investigations continue.