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

Matt Posky
by Matt Posky
volkswagen to conduct crisis meeting over eu cartel allegations bmw plays it cool

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.

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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?!?

  • Inside Looking Out You should care. With GM will die America. All signs are there. How about the Arsenal of Democracy? Toyota?
  • DenverMike What else did anyone think, when GM was losing tens of billions a year, year after year?
  • Bill Wade GM says they're killing Android Auto and Apple Carplay. Any company that makes decisions like that is doomed to die.
  • Jeff S I don't believe gm will die but that it will continue to shrink in product and market share and it will probably be acquired by a foreign manufacturer. I doubt gm lacks funds as it did in 2008 and that they have more than enough cash at hand but gm will not expand as it did in the past and the emphasis is more on profitability and cutting costs to the bone. Making gm a more attractive takeover target and cut costs at the expense of more desirable and reliable products. At the time of Farago's article I was in favor of the Government bailout more to save jobs and suppliers but today I would not be in favor of the bailout. My opinions on gm have changed since 2008 and 2009 and now I really don't care if gm survives or not.
  • Kwik_Shift I was a GM fan boy until it ended in 2013 when I traded in my Avalanche to go over to Nissan.