New chairman sees emissions scandal as threat to VW's viability: paper

Sat Oct 3, 2015 9:41am EDT
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BERLIN (Reuters) - Hans Dieter Poetsch, the incoming chairman of Volkswagen (VW)(VOWG_p.DE: Quote), sees the scandal around the rigging of emissions tests as a threat to the firm's viability albeit a surmountable one, a newspaper quoted him as saying.

At an internal company meeting this week at the VW headquarters in Wolfsburg, Poetsch described the situation as an "existence-threatening crisis for the company", Germany's Welt am Sonntag reported in a release ahead of Sunday's publication.

Poetsch also said that he believed VW could overcome the crisis, the newspaper said.

A VW spokesman declined to comment on the report.

Europe's largest carmaker has admitted cheating in diesel emissions tests in the United States and Germany's transport minister says it also manipulated them in Europe, where VW sells about 40 percent of its vehicles.

VW has set aside 6.5 billion euros ($7.3 billion) to help cover the cost of the scandal, but some analysts think the final bill could be much higher.

Moody's, S&P and Fitch have all put negative outlooks on their credit ratings, meaning they see a risk of downgrades.

Citing an unnamed insider, Welt am Sonntag said VW's planned investment budget of 100 billion euros through to 2018 was under review for cuts. VW declined to comment.

Sources close to the board told Reuters this week the supervisory board was looking at ways to make savings to try to avoid a downgrade in the company's credit ratings, which would lead to higher borrowing costs.   Continued...

Hans Dieter Poetsch, CFO of German carmaker Volkswagen, adjusts his glasses during a news conference in Wolfsburg, July 5, 2012. REUTERS/Fabian Bimmer