German car making giants Volkswagen shares have plummeted after revelations of an emissions scandal which is set to rock the company, the motor industry and reopen talks in regards to the current procedure of environmental car testing.
Yesterday VW’s shares closed down 19.82% at €106. This meant about €26bn had been wiped off the value of the German carmaker this week, with more losses set to play out. They are losing the support of serious investors by the day as this may be the biggest corporate scandal since the global financial crisis.
Last Friday, news that Volkswagen were under a criminal investigation in the U.S for breaching the Clean Air Act surfaced, and has since brought the company to its knees as more revelations and admissions continue to pour out.
VW have admitted using software that turns of emissions control during emissions testing in order to pass the test through test lab manipulation.
11 million diesel cars are known to be affected with 482,000 already being called back to manufacturers.
The largest car manufacturer in the world has already set aside $7.3 billion to deal with this emissions scandal.
Chief Executive Martin Winterkorn is under increased pressure to resign from his post. Yesterday he made an apology, stating he was and VW were “deeply sorry” they had “broken trust”.
With civil prosecution set to follow there are calls for an EU-wide investigation.