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+++ AUDI bosses have vowed that the company will bounce back this year after the impact of new WLTP emissions tests led to a sharp drop in sales and profits in 2018. The firm’s finance boss, Alexander Seitz, said at its 2019 press conference that it’s better prepared for the second round of WLTP emissions legislation and aims to have a general operating permit for all of its powertrains by the end of 2019. Along with simplifying its product portfolio, meeting the new regulations will allow Audi to reduce its fleet emissions, which Seitz says will help it distance itself from the long-lasting impact of the Volkswagen Group’s dieselgate scandal. Environmental concerns and the need to meet ever-tightening CO2 emissions restrictions form an integral part of Audi’s plan for the coming years. It has set goals of making all its plants CO2-neutral and introducing 30 new electric vehicles by 2025. This is part of a wider electrification programme within the Volkswagen Group, which will result in the launch of around 70 electric models across its various brands by 2030. Asked whether now is the right time for such an investment in EV technologies, CEO Bram Schot said that feedback from customers suggests “60-70% of drivers of electric cars are loyal to electrification” and that response to the brand’s new e-Tron has been overwhelmingly positive. Seitz also said that an event such as dieselgate “will never, ever happen again”. Audi has strengthened its multi-person checking system for each new vehicle and tightened its internal documentation process. +++ 

+++ The BMW i models have revolutionised design across the board at BMW and will continue to do so in the future, according to design chief Adrian van Hooydonk. “When we launched i3 and i8, they were quite radical and far from the norm for BMW but now they’ve become an integral part of our brand”, he said. “The design of the i3 and i8 opened doors for us that we didn’t even know were there for the design of our general cars, I think you see this in the 2018 models: the 3-Series, X5, 8-Series and so on. It’s a cleaner form language and that was all triggered by the first i cars”. Van Hooydonk confirmed design of the i4, an electric equivalent to the 3-Series arriving in 2021, has been signed off. “It has to look cleaner than the 3 Series because it is clean, it has to look super modern. As part of the i brand it needs to be at forefront of what we are able to offer”. He added that where there is big technological change in cars, BMW will mark it with bigger design changes. “Autonomous driving will be an even bigger trigger for design change than electric cars”, he said. Talking about BMW’s design philosophy, Van Hooydonk said the brand no longer think in generations of cars. “BMW used to make bigger changes every 10 years. Now, we see every new vehicle as opportunity to change. Tempo has significantly increased in the industry so we need to step up the pace”. +++ 

+++ BUGATTI has often openly stated its desire to expand its line-up with a second model, and the French company’s chief executive revealed the yet-unnamed car could use a battery-electric powertrain. “There, I would see us doing a battery-electric vehicle. There, the balance between performance and comfort is much more important, and it’s about daily usability. This is what I see”, Bugatti boss Stephan Winkelmann replied when asked him about the long-awaited second model. The car would be more comfortable than the Chiron and not as hardcore, so it wouldn’t need to reach jaw-dropping speeds in order to earn bragging rights. Besides, Winkelmann has indicated many times that top speed isn’t as important in 2019 as it was a decade ago, when Bugatti was making the Veyron. He notably made the decision not to put the Chiron on a track to test how fast it can go. His comments strongly suggest the second model will be positioned below the Chiron. Don’t expect Bugatti to make a Mazda MX-5 fighting roadster, however. Regardless of what it’s powered by, it will still boast a significant amount of power and it will cost at least $500,000. That’s a bargain compared to the $3 million Chiron. The second model is already in the planning stages. “Let’s see what we can do. I’m hoping for the best”, Winkelmann concluded. In the meantime, Bugatti wants to continue making coach-built models like the limited-edition Divo and the one-off, $19 million La Voiture Noire unveiled during the 2019 Geneva auto show. +++ 

+++ The downturn in CHINA ’s auto market worsened in January and February as an economic slowdown and a tariff fight with Washington chilled demand in the industry’s biggest global market. Sales of SUVs, MPVs and sedans plunged 17.5 % from a year earlier to 3.2 million in the first 2 months of 2019. The decline in sales of passenger cars in January was 15 percent. Economists and industrial analysts often combine the first 2 months of the year when looking at consumer activity to screen out the effect of the Lunar New Year holiday, when factories close for up to 2 weeks and commercial activity falls. Chinese consumers are putting off big purchases amid an economic downturn that saw growth last year fall to a 3-decade low of 6.6 %. Trade tension with Washington is fueling consumer jitters. The auto slump is squeezing revenue for global and Chinese automakers that are spending heavily to meet government targets to develop electric vehicles. Last year’s auto sales suffered their first decline in nearly three decades, calling 4.1 % from 2017 year to 23.7 million. The downturn has prompted suggestions Beijing will cut sales taxes or offer other incentives. Sales by Chinese brands fell 23 % to 1.3 million units in January and February, according to CAAM. Market share for Chinese brands shrank by 3 % compared with the same time last year to 41.8 %. Growth in sales of pure-electric and hybrid vehicles, which Beijing is promoting with subsidies, rose 98.9 % over a year ago to 148,000 units. Sales of SUVs, usually a bright spot for the industry, contracted 18.6 % to 141,000. +++ 

+++ DAIMLER and BMW are in talks to cooperate in developing vehicle platforms for electric cars in a step that could save each carmaker at least €7 billion. The 2 premium carmakers already have a joint procurement program and recently extended their alliance to include development of advanced driver assistance systems and mobility services. The talks over whether to cooperate on vehicle platforms could still fall apart. Both companies have acknowledged cooperation talks which include sharing engineering costs for driverless cars, but BMW and Daimler have repeatedly declined to comment on whether their cooperation could include entire vehicle platforms. BMW’s finance chief said in November he was open to deeper collaboration with Daimler but said it was difficult to identify win-win opportunities in the area of shared vehicle platforms. Daimler and BMW are in talks over whether to share engineering costs for compact and midsized cars, which are designed to be “electric first,” but also have the capability of accommodating conventional powertrains. BMW and Daimler would save €7 billion each, over a period of 7 years. However, the companies are seeking more potential savings, and that if larger vehicles were included in the project, savings could be higher. +++ 

+++ The all-new Volkswagen Golf Mk8 is in the final stages of development. There are also some juicy details about the upcoming GOLF R , as R Division’s chief, Jost Capito, told them that it’s “going to be fantastic” and that it won’t go down the electrified route. “The crown jewel of performance in a Golf remains the Golf R. We don’t want to take hybrids to a ridiculous strength. A hybrid needs to be affordable and have an ecological reasoning. It’s not just for performance. The GTE is an alternative choice for a GTI customer, and that will remain. The performance king will remain a Golf R, and the Golf 8 R is going to be fantastic”, Capito said. The Volkswagen exec was also asked about the rumored Golf R400, which is believed to have been scooped a couple of times being tested at the track. He confirmed that they did actually test such a model, but eventually axed it. “We did research and customers don’t want it”, added Capito. “They want around 300 horsepower and a price tag below €60,000. To move up to 400 horsepower, you’d lose 50 percent of sales volume and increase the cost of ownership”. Indirectly, this perhaps tells us that the Golf R Mk8 won’t get around 400 hp either, as that would inevitably raise its price tag. So, it should still have roughly 300 hp available on tap, maybe a little bit more to differentiate it from the current model, but the chassis modifications and other work will make it more agile and, perhaps, a little faster than the outgoing iteration, which accelerates to 100 km/h in just a little under 5 seconds with the DSG transmission. Underpinned by the MQB Evo platform, which is an upgraded version of the current car’s architecture, the regular Golf 8 will launch with the usual 3- and 4-cylinder petrol and diesel engines at first. The lineup will be expanded to include mild-hybrid or hybrid versions, as well as the GTI and R hot hatches. +++ 

+++ Warning: Don’t do anything stupid!” reads the sign to the right of Rick Haas’ office computer. It is the same tongue-in-cheek warning affixed to the dashboard of every off-road Roxor vehicle that Indian automaker MAHINDRA assembles in a suburb north of Detroit. The motto might also apply to the Indian automaker’s latest attempt to enter the U.S. auto market; an effort Haas, a former executive at Ford and Tesla, is leading. A decade ago, Mahindra tried to break in to the U.S. market with a low-cost pickup. The foray ended in failure and a lawsuit from dealers demanding their franchise fees back. Haas, the automaker’s North American chief executive, says this time Mahindra has a more cautious “pay-as-you-go strategy”. Instead of starting with a pick-up or passenger car, Mahindra is reintroducing its brand with the Roxor, a vehicle that looks like a vintage Jeep. Mahindra has built around 3,000 off-road Roxors and is using the model, which starts at around $15,000, to demonstrate to American consumers and dealers “acutely aware of our previous experience” here that the Indian automaker can build a reliable product before it launches mainstream models for use on American roads, Haas told. “Getting burned makes you cautious”, he said. Mahindra is one of a handful of European and Asian automakers gearing up to enter the U.S. market in hopes of gaining sales as well as credibility that can boost their brands at home. France’s PSA and China’s Zotye and GAC all have outlined plans for establishing beachheads in the world’s second-largest market by sales, which offers rich pickings in segments including pick-ups, SUVs and crossovers. But the United States is a mature market that most industry executives say is heading for a downturn, and it is already crowded with over 40 automotive brands and 300-plus models on sale. “There’s not a line waiting out the front door of every potential newcomer to North America of people saying ‘I cannot wait for a new car to show up here today’ ”, said Larry Dominique, North American head of PSA, which has also taken a cautious approach to relaunching here. PSA announced last month Peugeot will lead its U.S. return; the same brand that crashed out of this market less than 3 decades ago. Analysts and auto executives say new entrants must stand out in a crowd to crack the U.S. market, as Tesla has with electric vehicles. Just offering a cheap car may not be enough, said Mark Wakefield, head of the North American automotive practice for consultancy AlixPartners. The higher quality of used vehicles presents a challenge, while delivering the expensive safety features American consumers and regulators demand. “If you fail to deliver on that then you’re a pariah in the market”, he said. Prospective U.S. entrants might look to the example of South Korean automaker Hyundai, the last foreign automaker to successfully enter the U.S. car market. The Korean carmaker launched cheap models in the United States in 1986, as Toyota and Honda had done before. Hyundai scored early successes, but quality problems set the brand back, and forced a relaunch. Now, it is overhauling its U.S. strategy, shifting from sedans to SUVs. The problem for prospective entrants is that if they do find an untapped niche, consultants and analysts expect other automakers to rush to fill it themselves. Mahindra’s first foray into the U.S. auto market was a disaster, as plans to launch a low-cost pickup with high fuel efficiency never came to fruition, in part because it failed to meet federal emissions standards. Angry dealers who had signed on to sell the Scorpio pickup sued Mahindra. Mahindra regrouped. Haas set up Mahindra’s U.S. office in 2013 with just a handful of people, and that has risen to 450. The company decided not to go into direct competition with major automakers, but to enter the much smaller and less heavily regulated market for off-road recreational vehicles sold mainly in rural America. The Roxor stands out because it looks like a World War II Jeep. Mahindra has had a license since the end of that war to make such vehicles in India. Municipalities, mining and construction companies, and many others seeking rugged off-road vehicles have shown interest, Haas said. The Roxor also has caught the eye of the owner of the Jeep brand, Fiat Chrysler Automobiles (FCA), a potential competitor whose U.S. headquarters is just up the road from Mahindra’s. Last August, FCA asked the U.S. International Trade Commission to block Roxor sales because the model is too similar to its own Jeep. The commision has ruled FCA can pursue its intellectual property claims against the Roxor, but on Feb. 21 Mahindra asked the agency to review that ruling. Mahindra has signed up a network of 390 powersports dealers all over the country to sell the Roxor. Haas said around a third of powersports dealers also own car dealerships so the Roxor allows him to establish the brand, then build relationships with car dealers. “I can’t say what our plans are, but the smoke is going to clear out of the air in the next year to 18 months”, Haas said. Among the vehicles under consideration for the U.S. market is the new Marazzo, a MPV designed by Mahindra’s Michigan engineers for sale in India that has scored well in international crash safety tests and features Apple CarPlay. Instead of low prices, Mahindra plans to focus on its image of building rugged, durable vehicles for India’s roads. “We’re India tough”, Haas said. “That’s a value that resonates with a chunk of the population here”. The speed of Mahindra’s U.S. rollout will depend not only on retail consumers but the U.S. Postal Service, Haas said. The Postal Service is searching for its next generation of delivery vehicles and Mahindra is 1 of 5 finalists for the $6 billion project, which may be decided this year. “That contract would make a fast U.S. entry easier, as you might imagine”, Haas said. “If it doesn’t happen, then we have to decide what we’re doing here”. +++ 

+++ OPEL could launch a hot electric Corsa, possibly wearing a OPC badge, as early as 2021. The new generation Corsa is due later this year running on the platform borrowed from its Peugeot 208 sister car. It now seems the Opel could also benefit from the electric powertrain Peugeot has apparently earmarked for the new Peugeot 208 GTi hot hatch. Opel CEO Michael Lohscheller said, “You can be sure that we will have some positive surprises in terms of having emotion as one brand pillar of Opel. I think the electrification point is important; most people think electrification is for green reasons, for CO2 etc. It’s not only that. It’s also fun. I think that’s what we’re thinking of and how we might bring that to more people, but it’s just in the thinking at the moment. We’re thinking about how we can bring electrification to a new level in terms of sportiness. This emotional aspect of electrification is important, so its not years away”. Lohscheller confirmed that Opel will have 4 electrified models by the end of 2020. A plug-in version of the Grandland X will arrive at the end of this year, followed by an all-electric version of the new Corsa at the start of 2020. Next up will be an all-electric version of the Vivaro, unsurprisingly called Vivaro-e, while wrapping up the year will be an electric version of the next-generation Mokka X. “We’ve chosen to launch electric cars in some of the biggest segments”, Lohscheller told. +++ 

+++ PORSCHE ’s new 911 sports car is a sales success, causing the automaker to reallocate production of its 718 Cayman. Porsche will move production of the Cayman from its home plant in Stuttgart, Germany, to parent Volkswagen Group’s factory in Osnabrück. Higher than expected orders for the new 911 from dealers have led to Porsche lifting sales expectations for the car. “We are currently planning on moving the bulk of Cayman production in the course of this year to Osnabrück, possibly all of it, in order to meet the increased demand for the 911, said August Achleitner, Porsches head of its sports car lines. Achleitner, who will retire at the end of this month, said Porsches distribution requirement plan for the 911 already has had to be updated twice to take account for the unexpected number of orders. The shift will allow Porsche’s sports car factory, constrained in size due to its location in Stuttgart’s urban district of Zuffenhausen, can focus more on the 911. The shift in Cayman volumes will likely happen in August during the summer holidays. Osnabrück, the former Karmann factory acquired by Volkswagen Group in 2010, has often served as an extended site to ease production bottlenecks throughout the group. Next year it is scheduled to build the VW T-Roc Cabrio with an expected output of roughly 20,000 cars a year. +++ 

+++ PSA Group’s Opel brand said it would resume production at a factory in Kaluga, Russia, in the 4th quarter after exiting the Russian market in 2015. Opel said it would start selling 3 models in Russia this year, with 2 to be produced at the Kaluga site. Opel added that it aimed to expand its presence in Russia and soon offer further models. “Russia is a big, strategically important and attractive market with a lot of potential”, CEO Michael Lohscheller said in a statement. The Opel brand was withdrawn from Russia by its then owner General Motors in 2015, at the height of a crisis in the country’s car market due to a sharp depreciation in the rouble. PSA bought the Opel and Vauxhall brands from GM in 2017. +++

+++ TESLA unveiled its Model Y, promising a much-awaited crossover that will face competition from European automakers rolling out their own electric rivals. CEO Elon Musk said the battery-powered car, built on the same platform as the Model 3, would first debut in a long-range version with a range of 482 km priced at $47,000. Higher-end versions will start delivery in the autumn of next year. A standard version will be available in spring 2021, priced at $39,000 with a 370 km range, Tesla said. The vehicles can be configured to include 7 seats for an additional $3,000. Ordering the car requires a $2,500 refundable deposit. SUV and crossovers are fast-growing segments in the United States, Europe and China, the world’s largest auto market, where Tesla is building a factory, making the Model Y well positioned to tap demand. Tesla currently has 2 sedans in its lineup (the high-end Model S and mid-priced Model 3) plus a costly crossover, the Model X. Tesla has enjoyed little competition so far for its sedans, but competition for electric SUVs is heating up as Tesla tries to master a new set of economics from the luxury line that made its reputation. Ratings company Fitch warned that, despite Tesla’s early lead, “incumbent carmakers have the ability to catch up thanks to their capacity to invest and their robust record in product management”. Tesla’s targeted volume production date of late 2020 for the Model Y would put it behind electric SUV offerings from Audi, Mercedes-Benz and Jaguar. In a challenge to Tesla on its home ground, Audi unveiled its e-tron crossover in Richmond, California, last September. Getting the new vehicle into production quickly will be key for Tesla to build on the momentum of its Model 3, which has catapulted the automaker up the sales charts and helped Musk post back-to-back quarterly profits for the first time. The new Model Y may also help Tesla shift its lineup toward the tastes of U.S. consumers, who are increasingly ditching sedans for bigger crossovers and SUVs. “Entering the SUV/crossover market effectively doubles Tesla’s addressable market”, Gene Munster, a managing partner of venture capital firm Loup Ventures, wrote. Musk has promised an easier production ramp of the Model Y as it shares about three-quarters of its parts with the Model 3 and would need only half the capital expenditures of the sedan. The risk is “quite low”, Musk told analysts in January. Tesla would “most likely” build the Model Y at Tesla’s battery factory in Nevada, he said at the time. Musk gave no new details about where the Model Y would be produced. Still, the Model Y, like all Tesla models, has already seen pre-production delays. Suppliers were originally told production would start in November 2019, sources told Reuters last year. +++ 

+++ TOYOTA announced it is investing an additional $750 million at 5 U.S. plants that will bring nearly 600 new jobs, including the production of 2 hybrid vehicles for the first time at its Kentucky facility. It marks yet another expansion of the Japanese automaker’s U.S. presence, bringing to nearly $13 billion the amount it will spend by 2021. The latest investments are at facilities in Alabama, Kentucky, Missouri, Tennessee and West Virginia. Those same facilities were part of a 2017 announcement by Toyota for a $374 million investment to support production of its first American-made hybrid powertrain. President Donald Trump congratulated Toyota and tried to tie the announcement to his efforts on trade. Referring to an agreement with Canada and Mexico that would replace the 25-year-old North American Free Trade Agreement, Trump said: “Big news for U.S. Auto Workers! The new agreement is already fixing the broken NAFTA deal”. The revised version of NAFTA negotiated by the Trump administration, regarded by many as a modest recasting of the original agreement, has not been approved by Congress. The president made no mention when a Chevrolet Cruze factory in Ohio recently closed, the first of 5 North American plants that General Motors intends to shut down by early next year. Toyota executive Chris Reynolds said the investments represent yet more examples of the company’s long-term commitment to build where it sells, irrespective of trade uncertainty due to tariffs. “Our overarching manufacturing principle is if we can sell it here we need to make it here. That’s been true before any tariff uncertainty, it’s true during tariff uncertainty and it will be true after. Our investment cycles go beyond any particular political cycle”, he said. Toyota CEO Jim Lentz said the driving force behind the overall investment has been consumers’ “insatiable appetite” for light trucks over passenger cars, pointing to Highlander and RAV4 production and past pickup production. “But I’d be disingenuous if I didn’t say we also have an eye on trade”, Lentz said. “But these decisions we’re making today are really driven by consumers and our product portfolio going forward, for the most part”. The automaker is spreading the additional investments among several plants. Toyota’s Georgetown, Kentucky, facility will get a $238 million infusion to produce hybrid versions of Lexus ES 300 sedans starting in May and the RAV4 starting in January 2020, the company announced. The RAV4 production doesn’t signal a shift away from sedan production at the sprawling Kentucky plant, Toyota executives said. Instead, it reflects Toyota’s plan to build multiple vehicles at its plants to better insulate each facility from downturns in market cycles. “Unlike some of our competitors, we think there’s value in the sedan market, while it may not be as big as it was”, Reynolds said. The announcement also includes $288 million to increase annual engine capacity at Toyota’s Huntsville, Alabama, facility. The plant will add 450 jobs to accommodate new 4-cylinder and V6 engine production lines. Last year Toyota and Mazda announced plans to build a $1.6 billion joint-venture plant in Huntsville that will eventually employ about 4,000 people. Toyota also is spending $62 million on equipment to boost production of Toyota and Lexus cylinder heads at its Bodine Aluminum facility in Troy, Missouri, as part of its cost-saving New Global Architecture production strategy to share common parts and components among different vehicles. A $50 million expansion and equipment upgrade at a Bodine plant in Jackson, Tennessee, will add 13 jobs and produce engine blocks while doubling the capacity of hybrid transaxle cases and housings. And Toyota will add 123 jobs and spent $111 million to expand its plant and purchase equipment in Buffalo, West Virginia, to double the capacity of hybrid transaxles. Previously, Toyota also announced a $600 million investment at its Princeton, Indiana, plant to increase the capacity of its Highlander SUV and to incorporate the new production strategy, and $170 million to launch the Corolla on a new production line in Blue Springs, Mississippi. +++ 

+++ The Audi TT could live on in the brand’s electrified future, according to board member for technical development Hans-Joachim Rothenpieler. Asked if the 2-seater could fall victim to line-up consolidation in an effort to meet WLTP regulations and improve profitability, he stated that the board has been “fighting for it”. Audi plans to introduce 12 electric models before 2030, but it’s hopeful that the range will include a viable model in each segment. “We want it”, said Rothenpieler of the Porsche 718 rival, which has been the subject of “emotional discussions” taking place in recent Audi boardroom meetings. Prospects for the long-running sports car have long been in question, hampered by ongoing issues over profitability in the relatively low-volume segment. “The same applies to R8 as to TT”, Rothenpieler added. “We’re involved in discussing this, and these models and RS will need a change into e-mobility. That’s what we’re discussing. The e-tron GT is the first step, at the end of 2020; we have to keep our sporty DNA and I think we’re going to see in our discussions on what we’ll still need in terms of combustion engines and what we can transfer into e-mobility right away”. Audi’s CEO, Bram Schot, was more guarded on the subject, however. “Audi will always have icon cars,” he said. “We are an emotional brand. The e-tron GT will be a new icon. But with the TT and R8, we’re also looking at volumes because profitability is something we need to focus on”. +++ 

+++ The U.S. Securities and Exchange Commission (SEC) is suing VOLKSWAGEN and its former chief executive Martin Winterkorn over the German automaker’s diesel emissions scandal, alleging a “massive fraud” on U.S. investors. VW was caught using illegal software to cheat U.S. pollution tests in 2015, triggering a global backlash against diesel that and has so far cost it €29 billion. Regulators and investors argue VW should have informed them sooner about the scope of the scandal, while VW says it was not clear it would face billions of dollars in fines and penalties as others had paid out much lower sums for similar offences. The SEC said in its civil complaint that from April 2014 to May 2015, VW issued more than $13 billion in bonds and asset-backed securities in U.S. markets at a time when senior executives knew that more than 500,000 U.S. diesel vehicles grossly exceeded legal vehicle emissions limits. VW “reaped hundreds of millions of dollars in benefit by issuing the securities at more attractive rates for the company”, the SEC said, adding it “repeatedly lied to and misled United States investors, consumers, and regulators as part of an illegal scheme to sell its purportedly ‘clean diesel’ cars and billions of dollars of corporate bonds and other securities in the United States”. The suit filed in San Francisco seeks to bar Winterkorn from serving as an officer or director of a public U.S. company and recover “ill-gotten gains” along with civil penalties and interest. Winterkorn, who resigned days after the scandal became public in September 2015, was charged by U.S. prosecutors in 2018 and accused of conspiring to cover up the German automaker’s diesel emissions cheating. A lawyer for Winterkorn, who remains in Germany, declined to comment on the SEC action. VW said in a statement the SEC complaint “is legally and factually flawed, and Volkswagen will contest it vigorously. The SEC has brought an unprecedented complaint over securities sold only to sophisticated investors who were not harmed and received all payments of interest and principal in full and on time”. The automaker added that the SEC “does not charge that any person involved in the bond issuance knew that Volkswagen diesel vehicles did not comply with U.S. emissions rules when these securities were sold” but repeats claims about Winterkorn “who played no part in the sales”. German markets regulator Bafin could not be reached for comment about whether it was working with the SEC. VW has spent billions to pay claims from United States-based VW owners, environmental regulators, states and dealers, and has offered to buy back about 500,000 polluting U.S. vehicles. That figure included $4.3 billion in U.S. criminal and civil fines. But the SEC said VW “has never repaid the hundreds of millions of dollars in benefit it fraudulently obtained”. VW admitted to secretly installing software in 500,000 U.S. vehicles to cheat government exhaust emissions tests and pleaded guilty in 2017 to felony charges. 13 people have been charged in the United States, including Winterkorn and 4 Audi managers. VW also faces investor lawsuits in Braunschweig, Germany. Critics argue that VW should have informed investors on September 3, 2015 about having used a “defeat device” to cheat emissions tests, the same day that VW managers admitted to using illegal software to U.S. regulators. Investors were informed about VW’s diesel cheating after U.S. regulators blew the whistle on September 18, 2015. VW argues it did not have to inform investors earlier because it did not believe it was facing significant fines. VW’s management had sought to strike a deal with U.S. regulators behind closed doors, a process that would lead costs to be “controllable overall with a view to the business activities of Volkswagen Group”, a VW document showed. A defense filing made with the Braunschweig court says VW’s chief financial officer was informed that there was a potential problem with United States authorities on September 14, 2015. At the time, VW believed it could fix polluting vehicles with a software update and gauged the potential financial risk to be around €150 million, the Braunschweig document shows. +++ 

+++ VOLVO will pay a dividend of 2.9 billion Swedish crowns ($311 million) after record sales in 2018, the company said, with almost all of it slated to boost the coffers of its debt-laden Chinese parent Geely. The payment comes as carmakers are grappling with the fallout of trade wars, rising costs for developing electric and driverless cars, and an industry downturn that has dented even the most profitable companies. The trade war caused Volvo to postpone plans for a listing last year and generated additional costs to retool its factories to limit the tariff impact. Premium rival Daimler cut its dividend in February after its fourth-quarter profit plunged. In the same week Volvo reported a fall in 2018 profit margins and said margins would remain under pressure this year. Volvo has a stated goal to spend roughly 5 % of its annual revenue on building electric and autonomous cars, and a spokeswoman said Volvo believed it had enough cash to cover both the dividend and its development costs. This will be the second time that the Gothenburg-based company has paid a dividend since being bought in 2010 by China’s Zhejiang Geely Holding Group, which owns the Chinese car brand of the same name. Volvo had paid a dividend of 2.2 billion crowns for 2016. The Swedish carmaker said its owner will receive around 2.8 billion crowns of the dividend and Swedish insurance and savings group Folksam and pension fund investor AMF, which hold preference shares, will get around 125 million crowns. Geely has taken on debt after making recent stake acquisitions in Daimler and truck rival AB Volvo. Volvo, which did not make a profit for a decade under previous owner Ford, sold a record 642,253 cars last year and recorded an operating profit of 14.2 billion Swedish crowns. It has set a goal of reaching sales of 800,000 cars within the next few years. +++

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