‘The Lance Armstrong of Automakers’ is going to slam the brakes on the whole car industry for years
Mike Bird
BusinessInsider.com
Sept. 23, 2015
Volkswagen’s share price seems to have reached its lowest ebb, after a 35% drop on Monday and Tuesday.
But the emission scandal that has engulfed VW is far from over — and far from limited to just the German car maker.
In the aftermath of the revelation that VW’s was juicing the emission figures for its diesel cars, analyst have been trying to work out just how badly it will hit the company and Europe’s car manufacturing industry more widely.
The answer? Very badly.
To recap: the US Environmental Protection Agency (EPA) announced on Friday that 500,000 vehicles on US roads that had initially passed emissions tests were actually in violation, after more rigorous real-world tests.
It’s since emerged that this happened because of a clever piece of software that could identify when it was being tested and reduce harmful exhaust so it looked like the cars met requirements
Speculation began over the financial hit the company could take, with a potential fine running to $18 billion (£11.76 billion).
But the problems go further than just fines, say analysts, and won’t even end with VW — every major auto maker in Europe will feel the pain.
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