VW warns emissions scandal could lead to assets sales
Published: 10:10 28 Apr 2016 EDT
The dark cloud over car maker Volkswagen (XETRA:VOW) shows no sign of dissipating after it warned the emissions test cheating scandal could cost more than originally expected.
Much like the air surrounding its cars, there is a toxic atmosphere surrounding the company and things could be about to get worse for the German car manufacturer as it said US$18bn it has set aside may not be enough.
Europe's biggest motor manufacturer said it may have to sell assets to settle its debts.
In its annual report, Volkswagen said it could face “further significant financial liabilities” adding “the funding needed to cover the risks may lead to assets having to be sold.”
But there was good news for the company attempting to rebuild its reputation, as cost cutting and encouraging sales in China and Europe mean it should deliver a solid operating performance this year, the company said.
Volkswagen struck a deal last week to buy back or fix affected vehicles in the United States but it still faces U.S. Justice Department fines and could battle other cases all around the world.
Most likely to be sold, according to analysts, are its trucks business, but so far Matthias Mueller, chief executive, has ruled out selling brands or businesses.
