Economists Claim Volkswagen Is Now A Threat To The German Economy

Economists Claim Volkswagen Is Now A Threat To The German Economy
The Volkswagen emissions scandal has rocked Germany's business and political establishment and analysts warn the crisis at the car maker could develop into the biggest threat to Europe's largest economy.

Volkswagen is the biggest of Germany's car makers and one of the country's largest employers, with more than 270,000 jobs in its home country and even more working for suppliers.

Volkswagen Chief Executive Martin Winterkorn paid the price for the scandal over rigged emissions tests when he resigned on Wednesday and economists are now assessing its impact on a previously healthy economy.

"All of a sudden, Volkswagen has become a bigger downside risk for the German economy than the Greek debt crisis," ING chief economist Carsten Brzeski told Reuters.


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MDarringerMDarringer - 9/24/2015 10:34:59 PM
-1 Boost
Since when is Mitsubishi amazing? The products they sell in The States are pure garbage now that the EVO has been killed.


jameswisrikjameswisrik - 9/24/2015 4:38:58 PM
+5 Boost
it will very expensive for German Gov't to bail VW ..if they do. VW will have to either buy back TDI veh. or put new engines..not to mention all the world gov't will slap on penalties...and lawsuits all over. Also VW is slowly getting pennies from Spain/Greece/Italy and others on their loans. Plus Germans enjoy a lot of expensive social programs and now Syrian refugees coming into their country which will cost billion/trillions. And lost future VW/Audi/BMW/Benz/Porsche revenues.... and most important their reputation.


Vette71Vette71 - 9/24/2015 6:32:05 PM
0 Boost
Where do you two guys get your stuff?? It's amazingly out to lunch.
VW doesn't have to change engines or buy back cars.They can change the exhaust system to a urea system and reprogram the engine so the vehicles match what everybody else does. Cost $2000 to $5000 per vehicle. Keeps most of mpg and torque. Doing so would let them negotiate down the $38K/vehicle. Or they could set the cars to run in the test mode that passes, Cuts mpg and torque so customers unhappy.


Agent009Agent009 - 9/24/2015 9:15:08 PM
-2 Boost
@jameswisrik - there is no need to buy back anything. The fix will be a simple software flash. But it NEVER should have happened to begin with.


MDarringerMDarringer - 9/24/2015 10:36:52 PM
+4 Boost
@Agent009...not quite. Some the the diesels need urea injection to be compliant and THAT is a huge cost.


atc98092atc98092 - 9/25/2015 8:00:42 AM
0 Boost
MDarringer: the cars are fully compliant if the emissions system if fully functioning. All it will take is a reflash to eliminate the kill switch.

That said, what will happen to the non-SCR cars as far as economy, power, or reliability? The fully operating system may fill the DPF faster than the system can clear it, the turbo may get too hot, there's no doubt mileage will take a hit. For the SCR cars, it will likely mean the AdBlue injection is increased, with no impact on fuel economy or power. So the AdBlue tank needs filling after 5-6000 miles instead of 10,000 miles. The stuff is cheap, so for SCR cars it's not going to be a big deal to fix.

I am in no way defending VW. They cheated and deserve to pay for it. If they want me to ever buy another one, they're going to have to offer something significant to current owners.


TomMTomM - 9/25/2015 9:51:24 AM
+1 Boost
TO M.Darringer - No - while urea injection would be the most effective way to solve the problem - and retain performance and mileage - the cars can meet the emissions standards with the emissions equiptment on - so a software flash will make them legal - although it will reduce fuel mileage and performance - and resale values.
To ATC 8092 - this "problem" will - in the end - cost VW maybe 40-50 Billion Dollars - starting with an 18 Billion dollar fine in the USA - plus Canada fines - cost to repair - and lawsuits. I suspect that VW will have to offer each owner money for the loss in fuel mileage - as Ford did with their Hybrids - and it will likely also have to offer a trade in "support" for them as well.
ANd we still do not know how many other cars and countries are involved. While that amount is huge - it is doable for VW over a period of years. Offering extra trade in support will simply be a loss of profits for those cars. The question is - how well the rest of the VW cars continue to sell - because if they do not - then they are doomed. The first thing VW MUST do is get Independent tests of the emissions of all their diesels currently produced - including real world tests - to prove that they do not have a software workaround in them. Remembering that in Europe - diesels predominate - they have NO choice but to do that - or no one will buy their cars


TheSteveTheSteve - 9/24/2015 4:50:53 PM
-2 Boost
There's a lot of fear mongering going around nowadays. There's always something we're told we should be scared of, and now it's Dieselgate and how it will become the undoing of Germany, then the European Union, and then lead to global economic collapse.

Here's an alternative, and *I* believe much more pragmatic perspective:

=== Yeah, this is some serious sh*t going down. A huge company (VW) knowingly circumvents laws, and smugly proclaims how "green" they are. It reminds me of TV Evangelists who condemn others, embrace a holier-than-thou attitude, and are later disgraced when they're discovered to frequent male prostitutes (yes, it happened).

=== It's likely that VW is not an isolated example of such large-scale deception and deliberate law-breaking. A European article alleges BMW's X3 xDrive (AWD SUV) emits almost 12 times legal NOx levels, yet somehow, they attained the necessary certification to sell that vehicle.

=== People will come together to address this matter. Likely outcomes include:
- Cleaner emissions, though possibly still not meeting current legal requirements
- More accountability, though likely still imperfect
- More transparency, though likely well short of total transparency
- Maybe even the possibility of a more humble, more customer-focused VAG (okay, I'm hopeful, and this could be a stretch)

=== VW will not go bankrupt. VAG is to Germany what The Big Three are to the Unites States, so governments will act as middlemen and channel borrowed money to right some wrongs (to some degree), and they'll pass that debt to their own taxpayers, like the US Feds did in their bailouts and "Stimulus Packages."

=== Although VW is on the hook for a potential and horrifically staggering US$18.3 Billion in fines in the US alone ("up to" $38,000 per offending vehicle x 482,000 affected vehicles sold in the US), plus the fines for another 10.5 million offending vehicles sold outside the US, they'll likely pay a much, much smaller amount. After all, Authorities want to punish the "bad guys", not kill them.

=== Short-term finances and penalties aside, it'll take years for VW to recover from this scandal. That damage will show up as severely eroded consumer confidence in the brand, reduced sales, reduced or eliminated profits, reduced workforce, etc. Don't be surprised if you see a lot fewer VAG dealers over the next several years.


Note to VAG: Now is the time to eat some humble pie, and start being a lot nicer to your customers. Word of mouth carries. The last thing you need right now, on top of this scandal, is current customers regretting they own VWs and Audis because of their service and maintenance experiences, and telling their friends. More than anytime before, you need to do something big and quick to convert your existing customers into fans and product evangelists.

Good luck, VAG. I mean that deeply and sincerely.
___________
PS: Please do the right thing, and not just focus on PR to make people feel b


TheSteveTheSteve - 9/24/2015 4:52:34 PM
-1 Boost
(continued from above)
...better about you.


mplsmpls - 9/24/2015 5:55:16 PM
+3 Boost
http://www.dailymail.co.uk/news/article-3247421/Prostitutes-champagne-Viagra-fuelled-sex-parties-500-000-fund-bribe-German-MPs-latest-emissions-scandal-shows-VW-learned-murky-past.html

I think VW is finished.. or will be broken up


Agent009Agent009 - 9/24/2015 9:19:49 PM
0 Boost
AnimeJapan - where was all this when Toyota was buying back cars that rusted through? Or when floor mats were getting stuck under drivers feet because the lack of a 50 cent hold down. Or even the thousand of motors replaced for faulty design.

Yes in general they do make fairly durable vehicles, but i am not a fan of driving anything that prefers to stay a generation back on all technology.


W208W208 - 9/25/2015 6:59:00 AM
+2 Boost
I'll never own another Toyota after my last go-round with a brand new 2007 Camry V6 XLE. One of the first 6cyls. off the line evidently, and had tons of warranty repairs within the first three months, nevermind almost killing my wife and I on I64 when the steering wheel locked and the car stalled at 70mph.

At the completion of the 5 year loan, it was a money pit to keep on the road. My wife(ex-wife at this point) traded it in for a Suzuki Kizashi. Like stepping out of dog **** and into cow ****. The Suzuki never had any issues though.


BMWm4BMWm4 - 9/25/2015 7:49:58 AM
+2 Boost
Anime, Isnt Takata a Japanese Company responsible for selling Faulty airbags for years to almost every manufacturer in the world? Wasn't it just 5 years ago that Toyota/Lexus recalled about 20 Million cars for faulty floor mat construction, steering issues in the LS, & a traction control system that failed??

How great are the cars you claim to be? 20 Million cars is a lot to recall over the span of 3 years for manufacturing defects, scandal of safety violations and other infractions....

Yet you come on here an spew utter nonsense of how great the cars from Japan are and all others pail in comparison.

Agent would you please remove Anime from the site. It is quite tiresome to see comment after comment on nothing at all. THis is supposed to be a site that allows us who are performance and car fanatics to read and comment about current automotive events.


BMWm4BMWm4 - 9/25/2015 3:21:55 PM
+1 Boost
anime, ummm no. the recall was based on a faulty floor mat issue with bmw. The GX was not a steering thing, it was a traction issue that Consumer reports deemed as unsafe. Lexus had to stop production and install a software update to correct the issue. The steering issue was for the LS460 is which that car had to have a Stop selling til the software was fixed. Toyota did Recall 20 Million cars in a 3 year period and did admit to fraudantly hiding Safety defects in their cars.....

The RC-f is not a performance car. Second, has nothing to do with opinions. Yet how bout come up with something factual to back up your stance.

Per Wikipedia
"However, on October 24, 2013, a jury ruled against Toyota and found that unintended acceleration could have been caused due to deficiencies in the drive-by-wire throttle system or Electronic Throttle Control System (ETCS). Michael Barr of the Barr Group testified that NASA had not been able to complete its examination of Toyota's ETCS and that Toyota did not follow best practices for real time life critical software, and that a single bit flip which can be caused by cosmic rays could cause unintended acceleration. As well, the run-time stack of the real-time operating system was not large enough and that it was possible for the stack to grow large enough to overwrite data that could cause unintended acceleration.[30][31] As a result Toyota has entered into settlement talks with its plaintiffs.[32]"

*** Hence Toyota was at Fault ...

Here is the link

https://en.wikipedia.org/wiki/2009%E2%80%9311_Toyota_vehicle_recalls

My fault in the Recall Amount as it was only 9.8 Million Cars.


rockreidrockreid - 9/24/2015 10:04:01 PM
+1 Boost
ummm...wasn't Japan the country selling all those faulty air bags?


carsnyccarsnyc - 9/24/2015 10:44:19 PM
0 Boost
Can you spies in charge just cancel anime's account? There's nothing constructive about his speech.


investor27investor27 - 9/24/2015 11:11:43 PM
+5 Boost
Someone really needs to go to jail over this.


jameswisrikjameswisrik - 9/25/2015 10:20:02 AM
-3 Boost
https://www.yahoo.com/autos/s/bmw-mercedes-bmw-gm-could-cheating-emissions-tests-153019787.html

GM ALSO...THATS NOT SURPRISE. BUT THEY ALREADY PAID OFF OBAMA SO THEY WILL JUST PAY A MINIMAL FINE W/ US TAXPAYERS BAILOUT MONEY. VW SO FAR FIRED THERE EXEC..SAVE BILLIONS FOR FINES/LAWSUITS ETC....GM STILL HAS THERE MURDERING EXECS IN OFFICE!


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