(Newswire.net — September 23, 2015) — Volkswagen AG stocks slid by 37 percent within two days after news of a huge scandal over diesel-emission emerged, according to Bloomberg reports. The plunge represent a loss of approximately 24 billion Euros in market value.
“Volkswagen is working at full speed to clarify irregularities concerning a particular software used in diesel engines,” VW officials said in a statement. If the probe continues, the company will have to set aside more than the initial 6.5 billion Euros to compensate for the stock’s fall.
All ‘hell break loose’ for VW after the U.S. Environmental Protection Agency revealed on Friday that VW cheated on air-pollution tests. Bloomberg reported that 68-year-old Volkswagen CEO Martin Winterkorn said on Sunday that he is “deeply sorry” and promised a thorough investigation. However, carmaker officials said the company would explore Winterkorn’s role in malfeasance as well.
Reportedly, the so-called defeat device was installed in a certain type of diesel engines which include Audi A3 and VW Passat Sedan. However, for the other 11 million vehicles roaming globally, the ‘emission defeat’ software has no effect, VW said in a statement.
According to two U.S. officials familiar with the inquiry, the U.S. Justice Department has begun its own probe into the matter, which may result in serious consequences for the German carmaker. These consequences could affect even the German economy, already under pressure because of the Syrian refugee crisis.
“Our company was dishonest with the EPA, and the California Air Resources Board and with all of you,” the head of the VW brand for the U.S. Michael Horn said in New York while promoting a new VW Passat.
“We have totally screwed up,” Horn said, adding that VW must fix the cars to prevent this from ever happening again. “This kind of behavior is totally inconsistent with our qualities,” Hord said.