'Safe and ready to drive' VW exec sneers at customer damage claims over Dieselgate

German owners of emission-cheating diesel cars suffered “neither losses nor damages,” asserts VW’s head of legal affairs. And as for paying damage claims filed by the carmakers' shareholders: Forget it.
Quelle: AP
Fabricated in Germany.
(Source: AP)

When Hiltrud Werner became VW’s new executive for integrity and legal affairs in February 2017, she said the world's biggest carmaker should drop its arrogance, come clean with the past and avoid whitewashing its image.

Two years later, her tone is markedly different, saying German owners of manipulated diesel cars and shareholders aren't entitled to compensation.

has been VW's executive responsible for integrity and legal affairs since February 2017. She previously served as head of group audit at the carmaker. Quelle: Getty Images; Per-Anders Pettersson
Hiltrud Werner

has been VW's executive responsible for integrity and legal affairs since February 2017. She previously served as head of group audit at the carmaker.

(Source: Getty Images; Per-Anders Pettersson)

“In our opinion, customers have suffered neither losses nor damages. The vehicles are safe and ready to drive,” Werner said, referring to those people who had sued VW and requested damages for owning a rigged diesel car. So far, most courts have rejected these demands, she wrote to Handelsblatt. (The manager declined to talk to the publication face-to-face or by telephone.)

In September 2015, Volkswagen admitted it had deceived regulators and customers by manipulating its engine software. Around 11 million diesel vehicles worldwide appeared to run clean during emissions tests, but on the road the cars spewed out toxic fumes above legal limits. Two managers are serving jail sentences in the US, while around 80 current and former employees, including ex-CEO Martin Winterkorn, are suspected of wrongdoing.

Until June last year, VW had set aside €27.2 billion ($31.2 billion) to pay for settlements, fines and repairs, but most of that money – around $23.6 billion – went to customers and authorities in the US and Canada. That figure has now risen to €28.2 billion (see graphic). European car owners and VW shareholders have gone empty-handed, however, despite VW admitting in 2016 to the US Department of Justice it had committed fraud.

Grafik

Unlike in the US, German and European authorities have said they will be satisfied with mere software updates, leaving cars owners no other option than to go through lengthy court proceedings to win compensation. Neither the manipulation nor the software fix caused the value of diesel cars to drop, Werner said. The discussion about diesel bans in German cities, for instance, caused the drop in the cars' value, she said.

Shareholders banded together to sue VW, but investors have to individually file for damages if a court decides the carmaker is responsible for the depreciation of their shares. Werner said it was VW’s duty to protect itself from unwarranted claims.

“The plaintiff investors are predominantly institutional investors from Germany and abroad, some of whom are attempting to assert alleged claims against Volkswagen with questionable and inadmissible legal arguments,” she said.

Looking ahead, Werner said 2019 will be “the most difficult year” for the company since the emissions scandal became public in 2015, because VW faces a lot of work due to investor lawsuits. Legal costs, she added, have run into the hundreds of millions of euros.

Sönke Iwersen leads Handelsblatt's team of investigative reporters, while Rene Bender is an editor on that team. Jan Keuchel is a Handelsblatt correspondent for investigations and the German legal system. Volker Votsmeier is an investigative reporter with Handelsblatt. Gilbert Kreijger, an editor for Handelsblatt Today, adapted the article into English. To contact the authors: [email protected][email protected], [email protected] and [email protected]