Volkswagen: “We have totally screwed up”

As the battered motor manufacturer is set to announce who will take over as chief executive in the next couple of days, eyes turn from the US to other territories to see of Volkswagen have been dishonest elsewhere.

The US CEO (Michael Horn) used the phrase “We have totally screwed up” to describe the situation that the business was now in, and outgoing Volkswagen chief executive Martin Winterkorn said that he was stunned by the scale of company’s efforts to cheat engine emission tests in the United States.

Since 2009, VW diesel cars in (the US) had been fitted with software enabling them to mislead regulators and appear ‘greener’ than they really were, this includes some top selling cars like the Golf and Passat models as well as the Audi A3.

The new boss of the firm will have a lot on their plate as they have to deal with the millions of cars that are affected by the recent deceit as well as potential fines from regulators, criminal investigations and legal action by Volkswagen owners.

In the States, the legal action by Drivers has already started and Michael Lewin Solicitors has also has contact with drivers wanting to know if they have a claim if the cheating on the emissions tests extends to the UK.

If Volkswagen has been deceitful in the UK then it is possible that owners could be able to take legal action

Volkswagen have reported to put aside $7.3bn to (£4.8bn) to deal with the fallout from this issue.

Mike Hawes, chief executive of the UK’s Society of Motor Manufacturers and Traders, said yesterday that in the EU we operate a “fundamentally different system” from the US, and tests are performed in the strictest of conditions and witnessed by a government-appointed independent approval agency.

We need to remember that in the UK, there has been no evidence of cheating with emissions testing, and a likely response is to have the vehicles recalled, the software fixed and engines modified to ensure they meet published emission standards.

It’s a continually changing story, one in which we will keep an eye on, so that we are in the best position to advice clients.

At this time details aren’t clear in the UK, but one of the Volkswagen owners has spoken to Richard Coulthard (Head of Litigation) and suggested he would like his car replaced if Volkswagen have cheated UK and European emission laws.

In reality though the losses (and therefore compensation) might just be the difference between the premium price paid for these cleaner cars and what they are worth now, less any depreciation.

Richard Coulthard believes that potential litigation in England and Wales may follow depending on whether Volkswagen are also found to have cheated tests in the EU. If there is evidence of deceit in the emissions tests then in principle owners of affected Volkswagens may be able to claim that there was a material misrepresentation prior to entering into the contract for purchase of the vehicle and thereby allege that the contract is voidable by way of misrepresentation.

Given the potential costs to Volkswagen, even if they admit the deceit, it is likely that they will argue whether a correct emissions test would have materially affected the purchase of the vehicle. Cases may turn on the individual facts of the cases.

As this story further unfolds, so will the potential for formal legal action. Much may depend of how proactive Volkswagen are in rectifying the issues.

Follow this link if you would like to find out more about making a Volkswagen claim.

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