The Volkswagen diesel debacle in the US has hit Volkswagen group hard. Shares have dropped by a whole lot and the market value is now down by a third in just two trading days. And we thought the drop in the Ringgit was bad.
The story is simple. News broke that Volkswagen cheated in its diesel emissions tests in the United States where the pollution controls will only come into full swing when it detects the car is being tested for emissions. If one drives a Volkswagen model fitted with this software, chances are the car is actually between ten to forty times more polluting than when it is tested. Discrepancies relate to vehicles with Type EA 189 engines, involving some 11 million vehicles worldwide and there could be fines in the US hitting billions of US Dollars. In fact Volkswagen have set aside USD$7.27billion to cover any contingencies that may arise from this incident. And you thought RM2.6billion was bad.
