Winterkorn steps down in VW diesel emissions scandal

Volkswagen chief executive Martin Winterkorn, 68, has resigned, taking responsibility for the diesel emissions testing scandal that has severely damaged the world’s largest car maker.

He stepped down after an eight-hour meeting of an executive committee comprising key shareholders and worker representatives.

In a brief statement, he said he would “accept responsibility” for the “irregularities that have been found in diesel engines” and tendered his resignation to the supervisory board.

“I am shocked by the events of the past few days. Above all, I am stunned that misconduct on such a scale was possible in the Volkswagen Group,” he said.

The executive committee of the supervisory board said Mr Winterkorn had “no knowledge of the manipulation of emissions data” and added it would seek prosecution of any VW employees involved in the affair.

A special investigation committee would try to uncover what had happened and who was responsible.

The executive committee included Porsche-Piech family representative Wolfgang Porsche (51% voting shareholder), the premier of Lower Saxony state (20% shareholder) and three union chiefs.

In other developments overnight:

• VW shares rallied, reversing their earlier declines and ending up 5.2% after Mr Winterkorn’s resignation. This reduced the loss in market value in three days of trading to a quarter from a third.
• Platinum prices sank to six-year lows of $US926.35 an ounce as demand for the metal is expected to sag. It is used in the catalytic converters with which diesel cars are equipped.
• Prosecutors in the Lower Saxony city of Braunschweig are considering opening an investigation that would target “responsible employees” after several private individuals filed complaints with prosecutors.
• Germany’s vice chancellor and economy minister Sigmar Gabriel said the scandal must be quickly cleared up through cooperation by Germany and the company with US prosecutors and authorities.

“We must not allow the impression to arise that this is a problem for the whole auto industry or that it raises questions over the integrity of Volkswagen overall. The 600,000 employees of VW cannot help it that individuals carried out criminal actions on whatever scale.”

Some 37 lawsuits have been filed in the US and Canada by plaintiffs seeking compensation for the depreciation of their vehicles and the costs associated with a coming recall.

To recap, VW admitted it cheated on US emissions tests, leading to massive losses of its market value and facing prosecution and potentially billions in fines.

As many as 11 million cars from the VW group, including Audi and Skoda brands, have the engine software that were used to manipulate emissions.

The company issued a profit warning and is taking a €6.5 billion ($11.5 billion) provision against earnings. The shares lost 35% in value in two days of trading, cutting market value by €25 billion ($44 billion).

Career background
Mr Winterkorn began with VW as a quality control engineer at Audi in 1981 as assistant to the director of quality control. He became group CEO in 2007 and oversaw a period of rapid expansion.

He wanted to make VW the biggest, most profitable and best-run car company in the world. He almost did it. In the first half of this year, VW sold more cars than 2014’s volume leader Toyota.

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