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 The U.S. Justice Department has sued Volkswagen (VW) for up to $46
billion for breaching U.S. environmental laws, while there is still
no fix for nearly 600,000 cars affected in the United States almost
six months after the scandal broke.
The extent to which VW may be forced to cut jobs to help meet the
costs of 'Dieselgate' depends "decisively" on the level of fines,
VW's works councils chairman Bernd Osterloh said on Tuesday at the
meeting of workers in Wolfsburg which was also attended by the
carmaker's top managers.
"Should the future viability of Volkswagen be endangered by an
unprecedented financial penalty, this will have dramatic social
consequences," said Osterloh, who also sits on VW's 20-member
supervisory board.
Osterloh, speaking to workers at VW's flagship plant about the
emissions crisis and structural changes, called on the U.S.
authorities to consider the risk of possible job cuts in deciding on
penalties.
"We very much hope that the U.S. authorities also have an eye for
this social and employment-political dimension," he said.
Europe's largest automaker employs over 600,000 people at around 120
factories worldwide, including 270,000 in Germany. Its U.S. plant in
Chattanooga, Tennnessee employs about 2,200 people.
Speaking at the Wolfsburg meeting Chief Executive Matthias Mueller
said the scandal would inflict "substantial and painful" financial
damage on the carmaker, without elaborating.
Volkswagen last year set aside 6.7 billion euros ($7.39 billion) to
cover the expected costs of recalling of about 11 million diesel
vehicles globally. It has postponed the release of its 2015 results
by more than a month until April 28 to better assess the financial
implications of the crisis.
"The software manipulations and its consequences will keep us busy
for a long time," Mueller said on Tuesday, adding that it would take
years to determine the full extent of the financial impact of the
scandal.
The state of Lower Saxony, VW's second-largest shareholder, expects
more "unpleasant news" to emerge over the months ahead but remains
confident that the company has the financial strength to cope.
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"We will this year probably every now and then be confronted with
unpleasant news related to 'Dieselgate'," Stephan Weil, prime
minister of Lower Saxony, told the Wolfsburg meeting.
"The damage will, on balance, not be minor, that much can already be
said today, but Volkswagen luckily has a strong economic base,"
Weil, also a member of the supervisory board, said.
The Western German state, which holds 20 percent of VW's common
shares, has "no reason" to alter its commitment to the carmaker
despite the crisis, said Weil, a member of Chancellor Angela
Merkel's Social Democrat (SPD) coalition partners.
MORE SUSPECTS IN GERMAN INVESTIGATION
Separately, German prosecutors said on Tuesday they have widened
their investigation into Volkswagen's diesel emissions scandal and
are now targeting 11 more employees.
Klaus Ziehe from the state prosecutor's office in Braunschweig,
Lower Saxony, which is leading the German case against VW, said 17
people were now being investigated, up from six previously.
"The number of suspects has risen, although none are from the
management board," Ziehe said.
For a timeline on VW's diesel emissions scandal click
(Additional reporting by Edward Taylor in Frankfurt; Editing by
Keith Weir, Greg Mahlich)
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