Porsche to enter stock market before the end of 2022: VW

FRANKFURT, Germany - German auto group Volkswagen said it would go ahead this year with a highly anticipated stock market entry for its premium sports brand Porsche, despite less than perfect financial conditions.

"The Board of Management of Volkswagen AG today resolved... to pursue an initial public offering of the preferred shares of Porsche AG with the target to list them on the regulated market of the Frankfurt Stock Exchange... at the end of September/beginning of October 2022," a statement said.

"In the event of a successful IPO, Volkswagen AG will convene an extraordinary general meeting in December 2022 at which it will propose to its shareholders that a special dividend amounting to 49 percent of the total gross proceeds from the placement of the preferred shares and the sale of the ordinary shares be distributed," it added.

The auto giant officially signalled its intention to go ahead with the IPO on February 24, the day that Russia began its invasion of Ukraine.

"This is a historic moment for Porsche," new Volkswagen CEO Oliver Blume said, adding that Porsche could have "greater independence" and be one of "the richest sports car makers in the world".

The outbreak of the war has sown uncertainty in financial markets, sending stocks tumbling and clouding the outlook for the economy.

But the luxury brand continues to attract the attention of investors, who value Porsche between 60 and 85 billion euros, according to Bloomberg News.

Suitors including the Qatari sovereign wealth fund and luxury brands group LVMH have registered an interest in the high-end carmaker, according to the news agency.

Shift towards electric vehicles 

Under the spin-off plan, Volkswagen's main shareholders -- the Porsche-Piech family -- would take a share of 25 percent plus one share in the luxury carmaker. 

In doing so, the family would hold a blocking minority that will allow them to steer the future of the group that bears their name.

Market investors would be given the opportunity to buy preferential shares in Porsche that have no voting rights but receive a boosted dividend. 

The potential spin-off of the iconic carmaker, named for the Porsche family, from the larger group would help Volkswagen finance its own shift towards electric vehicles.

The Wolfsburg-based group is pumping tens of millions into the strategy, including building a clutch of battery factories across Europe and the US.

The potential gains from the IPO would give Volkswagen "greater flexibility to accelerate the transformation" of the group, chief operating officer Arno Antlitz said in an interview on Monday.

Volkswagen's recently departed CEO Herbert Diess launched the legacy carmaker on the headlong electrification strategy, bringing it into competition with the likes of American battery vehicles pioneer Tesla.

Blume was elevated to his new role last week from Porsche itself, where he still holds the title of chief. 

Blume, a Volkswagen group veteran, has said he wants to "keep up the current pace and where possible, increase it" on electrification.

Agence France-Presse

Volkswagen has paid $9.5 billion to US drivers over 'dieselgate'

WASHINGTON -- Volkswagen has paid some $9.5 billion since 2016 to US motorists misled by devices installed by the German automaker to cheat emission standards, the US federal consumer protection authority said Monday.

The international scandal -- known as "dieselgate" -- has tarnished Volkswagen's image ever since.

The auto giant admitted in 2015 to cheating emissions tests on 11 million vehicles worldwide. Software built into motors made the cars appear to spew fewer harmful pollutants in the lab than on the road.

wners of vehicles from VW or Porsche, a subsidiary of the Wolfsburg-based manufacturer, were given a choice between returning their car for compensation or having it modified to comply with clean-air rules.

"More than 86 percent of those who concluded the claims process chose to return their car through a buyback or early lease termination," the Federal Trade Commission (FTC) said in a statement summarizing its final report on what it calls the "largest consumer redress program in US history."

The most important thing, the statement added, is that the redress provided was "sufficient to compensate consumers fully."

Since the scandal broke, Volkswagen has had to deal with numerous legal actions, both criminal and civil. 

One of the last major lawsuits expected in Germany is that of former Audi boss Rupert Stadler, who is due to appear in court from September 30.

The total bill for the Volkswagen scandal is expected to exceed 30 billion euros ($35 billion), including the 9.5 billion euros already paid out in the United States to compensate customers. 

Agence France-Presse

Volkswagen strikes 'dieselgate' compensation deal with German consumers

FRANKFURT, Germany - German giant Volkswagen has struck a compensation deal with domestic consumer groups representing owners of cars caught up in its "dieselgate" emissions cheating scandal, a court said Friday.

"The consumer federation and Volkswagen have come to a comprehensive agreement," in a first-of-its-kind collective lawsuit brought by around 400,000 diesel car drivers, the Brunswick higher state court said, weeks after talks between the two sides broke down in acrimony.

source: news.abs-cbn.com

Volkswagen faces first mammoth diesel lawsuit on home turf

BRAUNSCHEIG, Germany - Car behemoth Volkswagen will face a German court Monday, as hundreds of thousands of owners of manipulated diesel cars demand compensation 4 years after the country's largest post-war industrial scandal erupted.

The first hearing in what is likely to be a grinding, years-long trial opens at 0800 GMT in Brunswick (4 p.m. in Manila), around 30 kilometers (19 miles) from VW headquarters in the northern city of Wolfsburg.

Around 450,000 people have joined a first-of-its-kind grouped proceeding, introduced by lawmakers after the "dieselgate" emissions cheating scandal broke in 2015.

Consumer rights group VZBV, representing the plaintiffs, says the German carmaker deliberately harmed buyers by installing motor control software that allowed vehicles to pollute far more on the road than under lab conditions.

The trial is Germany's largest so far in the tentacular diesel scandal, which last week saw VW chief executive Herbert Diess charged with market manipulation over his role.

50 QUESTIONS FOR JUDGES

In the mass lawsuit, the most important of around 50 questions for judges is whether Volkswagen "caused harm" by acting "dishonestly".

Klaus Mueller of VZBV said he is "convinced" the car firm did, while VW says "clients did not suffer harm."

"Hundreds of thousands of cars are used" on the roads without problem, VW lawyer Martine de Lind van Wijngaarden said.

Even if judges find in favor of plaintiffs, there will not be an immediate compensation payment.

Rather, every owner registered in the trial will have to claim individually.

VW thinks a final judgement could arrive in 2023 at the earliest, if the case is appealed all the way to the Federal Court of Justice.

Individual proceedings could then take at least another year -- in the court of first instance.

By then, the cars' market value could have eroded to a negligible amount, making a buyback cheaper for the firm.

To avoid such delays, the VZBV says it is "open" to an out-of-court settlement but "in that case, VW would have to pay a significant sum after all," Mueller told AFP.

Given the wide variety of cases under the group action umbrella, VW finds a mass settlement "hard to imagine."

In early July, judges noted in a preliminary opinion that some owners listed among the plaintiffs were living abroad.

That could mean German law does not apply to them.

Volkswagen said 2 percent of those listed live abroad and 10 percent are duplicate entries.

Alongside the grouped proceeding, 61,000 individual lawsuits have been filed in Germany, and some have already led to out-of-court settlements.

30 BILLION EUROS

Since 2015, when Volkswagen admitted to manipulating 11 million vehicles worldwide to fool emissions tests, the scandal has cost the group over 30 billion euros ($33 billion) in fines, compensation and legal costs.

Most of that sum -- $22 billion -- has gone to the US, while in Germany VW has so far paid just 2.3 billion dollars spread across three fines.

Alongside car owners, investors are claiming damages for losses they suffered when the group's share price plummeted after it came clean.

And earlier this week, chief executive Herbert Diess and supervisory board chief Hans Dieter Poetsch were charged with market manipulation.

Former chief executive Martin Winterkorn, who stepped down over the scandal, has been also charged with fraud.

Away from the legal battlegrounds, "dieselgate" has sped up the fuel's decline from its status as lower-carbon alternative to petrol, favored with government subsidies.

In Germany, its market share among new registrations has fallen from 46 to 33 percent, and the level of nitrogen oxides (NOx) emitted by the cars risks earning them bans from some city centers.

The diesel scandal is "part of the group's history" just like the famous Beetle and Golf models, says VW brand chief Ralf Brandstaetter.

But he adds the company has "profoundly changed," investing 30 billion euros in a new electric range to "regain society's respect."

"The diesel crisis was a catalyst for our transformation," Brandstaetter told AFP in a recent interview.

source: news.abs-cbn.com

Volkswagen to end production of the Beetle next year

Volkswagen said on Thursday it would stop producing its Beetle compact car in 2019, ending a model that looked backward to the 1960s counterculture as the automaker prepares for a leap toward a future of mass-market electric cars.

The original VW Beetle, developed in the 1930s, made a journey from a product identified with Adolf Hitler to a symbol of Germany's rebirth as a democratic, industrial powerhouse after World War II. In the 1960s, the Beetle was a small-is-beautiful icon of the postwar baby boom generation. Volkswagen discontinued US sales of the "bug" in 1979, but continued production for Mexico and Latin America.

In the mid-1990s, at a time when Volkswagen was struggling to rekindle sales in the United States, then-Chief Executive Ferdinand Piech pushed to revive and modernize the distinctive Beetle design pioneered by his grandfather, Ferdinand Porsche. The result was a crescent-shaped car called the "New Beetle," launched in 1998, which offered playful touches such as a built-in flower vase.

The New Beetle was a hit during its early years, with sales of more than 80,000 in the United States in 1999, but recently the car's US sales have suffered along with most other small cars. Overall, VW has sold about 500,000 Beetles globally since 1998, the company said.

Volkswagen sold a total of 11,151 Beetles in the United States through the first 8 months of 2018, down 2.2 percent from the same period a year earlier. US consumers looking for a small Volkswagen vehicle overwhelmingly prefer the Jetta sedan, or a Tiguan compact sport utility vehicle. The Jetta, Tiguan and Beetle are built for North America and other markets at a factory in Mexico.

The end of the Beetle comes at a turning point for Volkswagen. The German automaker's last 3 years have been rocked by the fallout from a scandal caused by its admitted cheating on diesel emissions tests. Now, Volkswagen is gearing up to launch a wave of electric vehicles to appeal to a new generation of environmentally conscious consumers - children and grandchildren of the 1960s Beetle enthusiasts.

In a statement announcing the end of the Beetle, Hinrich Woebcken, head of Volkswagen of America, said that as the company ramps up its electrification strategy, there are no plans to replace the Beetle. However, his statement did not rule that out someday. He noted the company’s ID Buzz, a prototype for a 21st Century reincarnation of the microbus. The automaker has said it intends to put a vehicle similar to the ID Buzz into production as an electric vehicle.

The company said 2 special Beetle models will join the final lineup - Final Edition SE and Final Edition SEL - in the United States and would offer driver-assistance technology. 

source: news.abs-cbn.com

Volkswagen to pay $175 million to US lawyers suing over emissions

WASHINGTON - Volkswagen AG, in another step to move past its costly diesel emissions cheating scandal, has agreed to pay $175 million to US lawyers suing the German automaker on behalf of the owners of 475,000 polluting vehicles, two people briefed on the agreement said on Friday.

In August, the lawyers in the class action litigation sought up to $332.5 million in fees and costs for their work in a $10 billion settlement that gives US owners of 2.0 liter polluting cars the ability to sell back their vehicles to Volkswagen (VW).

The latest deal with the lawyers means VW now has agreed to spend up to $16.7 billion to compensate US owners and address claims from states, federal regulators and dealers arising from the "Dieselgate" scandal.

The amount to be paid out to lawyers was first reported by Reuters on Friday.

The resolution of legal fees clears another hurdle as the world's No. 2 automaker looks to resolve all of the outstanding aspects of a scandal that disrupted its global business, hurt its reputation and led to the ouster of its chief executive officer last year.

VW in September 2015 admitted using sophisticated secret software in its cars to cheat exhaust emissions tests, with millions of vehicles worldwide affected. The cheating allowed VW's US vehicles sold since 2009 to emit up to 40 times legally allowable pollution levels.

The $175 million includes attorneys' fees and other costs, according to the sources, who spoke on condition of anonymity.

Lawyers for the owners of polluting vehicles and a spokeswoman for Volkswagen declined to comment.

Lead plaintiff lawyer Elizabeth Cabraser, who is part of a committee of 22 lawyers overseeing the owner suits, said in August the amount sought in attorneys fees was far less than the "judicially established benchmark" for class actions of approximately 25 percent of the settlement amount.

US District Judge Charles Breyer on Tuesday is set to hold a hearing in San Francisco on whether to grant final approval of the vehicle owners' settlement announced in June, which would be the largest-ever automotive buy-back offer in the United States. Breyer must also decide whether to approve the legal fee agreement.

VW has agreed to spend up to $10.033 billion to buy back the vehicles and compensate owners. It may also offer vehicle fixes if regulators approve. Under a timetable announced this summer, regulators could approve a fix for some 2015 VW diesel vehicles as early as next month.

In addition, VW has agreed to pay up to $1.21 billion to compensate US VW brand dealers, pay more than $600 million to 44 US states, spend $2 billion on zero-emission vehicle promotion and infrastructure, and another $2.7 billion to offset diesel pollution.

It still faces billions of dollars in potential fines from the US Justice Department in its criminal probe into VW's cheating scandal, and must resolve the fate of larger vehicles that were not part of the initial $10 billion settlement.

VW and US regulators are in continuing discussions over whether the automaker should agree to buy back 85,000 larger 3.0-liter Porsche, Audi and VW vehicles that also exceeded U.S. emission standards, and whether it should offer additional compensation to those owners.

VW may have to pay additional owner attorneys' fees as part of a separate potential 3.0-liter settlement, the sources said.

source: www.abs-cbnnews.com