EuroWire March 2016

Transatlantic cable

Two VW executives based in the USA, who spoke to the reporters on condition of anonymity, shared that view, saying there have been no internal discussions about pulling out of the American market. And Mr Müller himself declared in January, “The USA is and remains a core market for the Volkswagen Group.” † How the rehabilitation e ort plays out remains to be seen. Meanwhile, another interested party struck a de ant-hopeful note that will likely be heard again. “A lot of manufacturers have gone through major incidents when it comes to recalls,” the general manager of a Volkswagen dealership in Perrysburg, Ohio, told the Times . “Yes, VW cheated the system. But the vehicles didn’t break down. And there was no loss of life.” Although aviation was left out of the climate agreement adopted in Paris in December, reducing aircraft emissions is a priority In any discussion of emissions pollution it must not be overlooked that the airplane poses a greater threat than the automobile. Although the Air Transport Action Group, an industry organisation, estimates that emissions per seat-mile are down 70 per cent from the 1960s, when jets were introduced, the tremendous growth of the airline industry has resulted in higher total emissions. With commercial aviation accounting for about two per cent of the global total of carbon dioxide emitted annually by

To that end, he added, “We are now creating a di erent and better company, a new Volkswagen.” On leaving Detroit, Mr Müller would head to Washington to meet with federal regulators about the company’s timeline for xing nearly 600,000 diesel-powered cars in the USA (among 11 million a ected worldwide) equipped with devices that enabled them to emit 40 times the amount of pollutants allowed by federal rules. The change in tone from that of the VW CEO who visited the Detroit show in 2011 was quite evident. Then, Dr Martin Winterkorn, who retired in the wake of the cheating disclosures, had declared a goal for Volkswagen brand sales in the USA market of 800,000 vehicles by 2018. In the event, while total USA auto sales rose six per cent in 2015 to set an annual record of 17.5 million vehicles, Volkswagen brand sales sank ve per cent, to 349,000 vehicles – just slightly over two per cent of that market. † Even before the emissions crisis erupted, Volkswagen was having trouble competing in the USA with market leaders like General Motors, Ford Motor and Toyota. But, according to Mr Vlasic and Ms Chapman, few in the industry think Volkswagen, despite the huge nancial liabilities it now faces, would ever pull out of the USA, where it has spent billions of dollars building a dealer network and is expanding an assembly plant in Tennessee. “For them to back away from the US market is not realistic,” Karl Brauer, an analyst with the research rm Kelley Blue Book, told the Times . “They just cannot cede this market to their competitors.”

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March 2016