VOLKSWAGEN reported Wednesday October 28, its first quarterly loss for 15 years after putting aside charges in its accounts due to its emissions scandal.
VW admitted to installations of software in 11 million of its diesel cars that cheated emissions tests. The company said it had set aside €6.7 billion to cover scandal costs, leaving a €2.52 billion pre-tax loss. The company expects sales to grow despite the scandal, however, VW said it expected full year profits to drop “down significantly.”
Chief financial officer Frank Witter said: “No penalties or fines [or] compensation to customers have been included [in the €6.7bn charge]. The financial burden is enormous but manageable… but we will emerge stronger and leaner than ever before.”
Matthias Mueller, VW’s chief executive and chairman of the board of management, said: “The figures show the core strength of the Volkswagen Group on the one hand, while on the other the initial impact of the current situation is becoming clear. We will do everything in our power to win back the trust we have lost.”
The German car maker believes they can survive the crisis as once crisis costs are stripped away, what remains is a strong, profitable business.