Carmaker says it will not appeal and hopes fine is major step towards ending crisis
Wed 13 Jun 2018 19.09 BST
Volkswagen has been fined €1bn (£880m) over diesel emissions cheating in what amounts to one of the highest ever fines imposed by German authorities against a company.
The fine follows a US plea agreement from January 2017 when VW agreed to pay $4.3bn to resolve criminal and civil penalties for installing illegal software in diesel engines to cheat strict US anti-pollution tests.
“Following thorough examination, Volkswagen AG accepted the fine and it will not lodge an appeal against it. Volkswagen AG, by doing so, admits its responsibility for the diesel crisis and considers this as a further major step towards the latter being overcome,” the company said in a statement.
The prosecutor’s office in Braunschweig ordered the fine against the carmaker for organisational deficiencies in supervision that failed to prevent “impermissible software functions” from being installed in 10.7m cars between 2007 and 2015.
The prosecutor’s office said in a statement it had “ascertained a violation of supervisory duties”, adding that the fine did not address civil claims or claims by vehicle owners.
The €1bn fine does, however, end regulatory offence proceedings against VW, which the Wolfsburg-based carmaker said it assumed would help to settle further administrative proceedings against it in Europe.
Analysts at Evercore ISI said the fine would likely help end all criminal investigations against VW in Europe, but would not settle shareholder lawsuits.
The fine was not included in €28.5bn of provisions that VW set aside for the diesel cheating scandal, and would hit earnings, Evercore ISI said.