Dieselgate: VW costs reach $30 bn on US recalls

Volkswagen on Friday said it was setting aside another 2.5 billion euros to deal with the fallout from the "dieselgate" scandal in the United States as its efforts to recall tainted cars there proved to be more "complex" than expected.

The latest provisions bring the total sum set aside by VW to deal with fines and costs over the diesel scandal to €25.1bn.

"In the third quarter negative special items of circa 2.5 billion euros are expected to weigh on the operating result," the German car giant said in a statement.
"The reason is an increase in provisions relating to the buyback/retrofit programme for 2.0-litre TDI vehicles, which is part of the settlements in North America that is proving to be far more technically complex and time consuming."

Europe’s biggest automaker admitted in September 2015 it had used illegal software to cheat U.S. diesel emissions tests, sparking the biggest business crisis in its 80 year history. Before Friday, it had set aside 22.6 billion euros ($26.7 billion) to cover costs such as fines and vehicle refits.

The German vehicle giant has been engulfed in crisis since US regulators uncovered the cheating scam two years ago, and its legal woes are far from over at home and abroad.

In Germany on Thursday, prosecutors arrested a second Audi employee and said they were widening their investigation into the diesel emissions cheating scam to include more suspects.

German media named the arrested suspect as Wolfgang Hatz, who stepped down from his post on Porsche’s management board in 2016 after being suspended over the dieselgate investigation.

Hatz was head of engine development at Audi from 2001 to 2007, before moving on to lead powertrain development at the VW group and then becoming research and development chief at Porsche, another VW subsidiary.

VW said it would publish its third-quarter results on October 27.