Volkswagen said Wednesday it considers German shareholder lawsuits to be “without merit”, as the company “promptly” disclosed information regarding the risks to its stock price after its violation of United States environmental regulations was announced.
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The first blow to shareholders was a high-level power struggle between Winterkorn and Ferdinand Piech, a prominent member of the family that controls more than half the company’s shares and a former CEO.
It follows reports and much speculation regarding how much top Volkswagen officials knew about the use of “defeat device software” in diesel cars-and when they were tipped off about it.
Journalists will attend the event in Wolfsburg, Germany, while shareholders will need to wait for June 22, Volkswagen said in a statement.
News of the scandal broke in mid-September when the US Environmental Protection Agency said Volkswagen installed software on hundreds of thousands of cars that enabled them to cheat on emissions tests. On 14 November 2014, Mr. Winterkorn received another memo that reported, amongst other things, on several then current product defect cases and referred to a cost framework of approx.
The automaker paints a picture of a CEO possibly too consumed by running the 12-brand empire he built to take note of the 2014 memos, one included in his “extensive” weekend reading and another in a packet of information about product safety issues.
The starting point of the diesel matter was, in hindsight, the strategic decision by Volkswagen in 2005 to start a major diesel campaign in the United States and to facilitate a breakthrough for this technology which at the time was already very popular in Europe. The figure did not include the likely billions of euros in costs from fines and compensation payouts.
Volkswagen has confirmed around €6.7 billion in capital has been reserved for repairs and modifications for around 11 million vehicles impacted by the emissions cheat.
Finally, on July 27, 2015, “individual Volkswagen employees” discussed the issue “on the periphery” of a meeting at which Winterkorn and VW brand boss Herbert Diess were present, the company’s press release said.
The illegal defeat device in the EA 189 engines can detect when the vehicle is being tested for emissions.
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Regulators in the US may have concluded that VW’s latest legal and financial vulnerabilities represent an opportunity to advance the government’s clean-air policy. The Company emphasizes that this examination does not replace the independent investigation for the complete clarification of the diesel matter which is being conducted by the law firm Jones Day and is ongoing.
