VW adds 75,000 vehicles to emissions cheat scandal

WOLFSBURG, Germany — Volkswagen AG cut $1.1 billion from its 2016 investment plan Friday, as its emissions cheating scandal expanded to include tens of thousands more U.S. vehicles.

Volkswagen has told U.S. regulators that emissions issues in larger luxury cars and SUVs extend to an additional 75,000 vehicles dating to 2009, the U.S. Environmental Protection Agency said Friday.

The disclosure widened the VW scandal, which had focused mainly on smaller-engined, mass-market cars, and raised the possibility that engineers at both the Audi and VW brands could have been involved in separate emissions schemes.

Earlier Friday, the supervisory board of Europe’s biggest auto manufacturer said it would cap spending on property, plant and equipment around $12.8 billion next year, down about 8 percent from its previous plan.

VW is battling the biggest business crisis in its 78-year history after admitting in September that it cheated diesel emissions tests in 482,000 2.0-liter diesel cars sold in the United States since 2009.

In November, the EPA and California Air Resources Board also accused VW of evading emissions in at least 10,000 Audi, Porsche and VW sport utility vehicles and cars with 3.0-liter V-6 diesel engines. VW initially denied the findings.

But during a meeting Thursday, VW and Audi officials told the EPA that all 3.0-liter diesel engines from model years 2009 through 2016 had higher emissions than allowed.

The disclosure covers a total of 85,000 vehicles, the EPA said, including the diesel 2016 Audi A6 Quattro, A7 Quattro, A8, A8L and Q5; Porsche Cayenne; and Volkswagen Touraeg.

Analysts have said the scandals could cost the company $42.6 billion or more in fines, lawsuits and vehicle refits.

The widening scandal “slows VW’s ability to move beyond the negative headlines and start the rebuilding process,” said Karl Brauer, senior analyst at Kelley Blue Book.

“You can’t recover from a scandal while it’s still growing. You have to reach a point where everything is on the table and no more bad news is coming — then you can start repairing the damage.”

Also Friday, VW was due to submit plans to U.S. regulators for dealing with vehicles affected by its emissions cheating. Pressure has been building on the company to buy back some older diesel vehicles.

Chief Executive Matthias Mueller said in a statement: “We are operating in uncertain and volatile times, and are responding to this. We will strictly prioritize all planned investments. … Anything that is not absolutely necessary will be canceled or postponed.”

The cut in capital spending is VW’s first since the height of the financial crisis in 2009.

In previous years, the company has published investment plans for several years ahead. But on Friday, it gave numbers only for next year and did not give a figure for research and development, which last year accounted for about a quarter of overall planned spending of $91.15 billion for 2015-19.

Some analysts have long urged VW to reduce spending and become more efficient, with profit margins at its mass-market namesake brand lagging those at rivals.

They have suggested the emissions scandal could provide an opportunity for management to force changes that otherwise might have been resisted by the company’s influential trade unions, and ultimately boost VW shares.

VW’s preference shares, down about a third since the crisis broke, rose 2.5 percent to $115.48 Friday.



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