Volkswagen to Conduct 'Crisis Meeting' Over EU Cartel Allegations, BMW Plays It Cool

Matt Posky
by Matt Posky

Volkswagen will hold an emergency supervisory board meeting on Wednesday to discuss recent allegations that Germany’s automakers have been operating as an automotive cartel since the 1990s. Meanwhile, Daimler’s workers council is demanding answers from management as the automaker reels from a one-two-punch of collusion and emissions cheating accusations.

“I advise the car industry to clear the air now, to say what has happened, and then we can look to the future together again,” parliamentary group leader Volker Kauder, said Monday on German television. “If the antitrust violations prove true, and there’s a lot to suggest that, then one must really say the clear sentence: the rule of law also applies to the car industry.”

However, claiming there is sufficient proof to prosecute is a little premature. With the exception of a somewhat damning letter intercepted from VW, no hard evidence of collusion has been made public. Investigators are still in the early stages of the antitrust probe and have given few details as to its progress.

Regardless how true the allegations are, Germany’s automakers will still be entering damage control this summer. BMW, Daimler, and Volkswagen’s share price all took a hit on Monday morning after investors, soured by the news, sold off their shares en masse.

A large contributor to the recent cartel suspicions are the similarities between Mercedes’ recent recall of 3 million diesel vehicles and the one that led Volkswagen to disaster in 2015. It was suggested by Der Spiegel that German automakers conspired to use smaller diesel emission fluid (DEF) tanks, which resulted in the use of software-based defeat devices when the systems failed to meet emissions standards. However, the size of the tanks should be irrelevant and BMW has been quick to remind everyone that its diesel technology had passed muster — denying the company has ever involved itself in any emissions cheating.

“As a matter of principle: BMW Group vehicles are not manipulated and comply with respective legal requirements,” the company said in a statement. “Of course this also applies to diesel vehicles. The BMW Group categorically rejects accusations that Euro 6 diesel vehicles sold by the company do not provide adequate exhaust gas treatment due to AdBlue tanks that are too small.”

It’s unlikely the governmental probe will yield any fast answers, but that hasn’t prevented those affected from demanding them. According to Reuters, Daimler works council chief Michael Brecht called for an immediate investigation into the antitrust claims. Brecht stated that “workers are rightly horrified and angry” by the allegations and that consequences should result if they’re proven true.

Volkswagen’s union council had similar concerns. “Management has the duty to thoroughly inform the supervisory board. That hasn’t happened yet,” the VW works council said in an official statement. “We also expect the management board to give an explanation to the workforce. Trust in company leadership is dwindling more each day.”

A spokesperson from Volkswagen has confirmed that chairman Hans Dieter Pötsch will convene a special supervisory board meeting to the discuss the matter on Wednesday morning. Daimler has not made any plans for such a meeting, according to company spokeswoman Ute Wüest von Vellberg, but it will report its quarterly results on June 26th — and the board is likely to convene beforehand.

Presently, the only standing accusations revolve around the price fixing of various automotive parts, specifically the AdBlue diesel treatment systems. There have been no claims made that any automaker engaged in price fixing to consumers.

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • Stingray65 Stingray65 on Jul 24, 2017

    BMW is really sticking their necks out with such a statement, so they are either innocent or believe the evidence is really well buried.

  • Phila_DLJ Phila_DLJ on Jul 25, 2017

    What will we learn next: MB-TEX IS PEOPLE?!?

  • Bob65688581 We bought zillions of German cars, despite knowing about WWII slave labor. Refusing to buy something for ideological reasons is foolish.Both the US and the EU have imposed tariffs, so the playing field is level. I'll buy the best price/quality, regardless of nationality.Another interesting question would be "Would you buy one of the many new European moderate-price EVs?" but of course they aren't sold here.Third interesting question: "Why won't Stellantis sell its best products in America?"
  • Freshblather No. Worried there will be malicious executable code built into the cars motherboard that could disable the Chinese cars in the event of hostilities between the west and China.
  • Bd2 Absolutely not - do not want to support a fascist, totalitarian regime.
  • SCE to AUX The original Capri was beautiful. The abomination from the 90s was no Capri, and neither is this.It looks good, but too similar to a Polestar. And what's with the whacked price?
  • Rover Sig Absolutely not. Ever.
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