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VW orders external probe into diesel emission scandal

There are well over 480,000 Volkswagen-made, diesel-powered vehicles currently traveling roads in the United States that do not meet the Environmental Protection Agency's emissions requirements. This, as you can probably imagine, is a very big deal, and has led VW CEO Professor Doctor Martin Winterkorn to release an official statement on the matter. "I personally am deeply sorry that we have broken the trust of our customers and the public," he said. It's important to note that these vehicles run software with a so-called "defeat device" that kicks in when the on-board computer senses that it is being tested for emissions. When the car is operating normally – in other words, when its exhaust isn't being sniffed – the cars do not meet US emissions standards. According to the EPA and the California Air Resources Board, affected cars emit as much as 40 times the allowable level of certain pollutants. "We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case," according to Winterkorn, who added, "Volkswagen has ordered an external investigation of this matter." It's not yet known who will carry out this investigation. At present, there are still a number of 2015 Volkswagen models on dealer lots that do not meet emissions requirements. VW has issued a stop sale on vehicles equipped with the 2.0-liter TDI diesel engine. What's more, the German automaker has been barred from selling 2016 model-year vehicles that use this engine, according to The Detroit News. Last year, diesel vehicles made up about 22 percent of all VW sales, which means these restrictions will have a big impact on the brand's sales performance until a remedy is found and the vehicles are approved for sale. Interestingly, the EPA has started a campaign of sorts to test vehicles from other automakers that sell diesel-powered vehicles in the United States to make sure they comply with emissions requirements under all operating circumstances. The EPA says it "will be reviewing [its] compliance protocols and introducing ways in which [it] can effectively test not only for emissions performance but also for the potential presence of defeat devices," according to a statement provided to The Detroit News. Check out the full statement from VW CEO Martin Winterkorn below. Related Video: STATEMENT OF PROF. DR.

The UK votes for Brexit and it will impact automakers

It's the first morning after the United Kingdom voted for what's become known as Brexit – that is, to leave the European Union and its tariff-free internal market. Now begins a two-year process in which the UK will have to negotiate with the rest of the EU trading bloc, which is its largest export market, about many things. One of them may be tariffs, and that could severely impact any automaker that builds cars in the UK. This doesn't just mean companies that you think of as British, like Mini and Jaguar. Both of those automakers are owned by foreign companies, incidentally. Mini and Rolls-Royce are owned by BMW, Jaguar and Land Rover by Tata Motors of India, and Bentley by the VW Group. Many other automakers produce cars in the UK for sale within that country and also export to the EU. Tariffs could damage the profits of each of these companies, and perhaps cause them to shift manufacturing out of the UK, significantly damaging the country's resurgent manufacturing industry. Autonews Europe dug up some interesting numbers on that last point. Nissan, the country's second-largest auto producer, builds 475k or so cars in the UK but the vast majority are sent abroad. Toyota built 190k cars last year in Britain, of which 75 percent went to the EU and just 10 percent were sold in the country. Investors are skittish at the news. The value of the pound sterling has plummeted by 8 percent as of this writing, at one point yesterday reaching levels not seen since 1985. Shares at Tata Motors, which counts Jaguar and Land Rover as bright jewels in its portfolio, were off by nearly 12 percent according to Autonews Europe. So what happens next? No one's terribly sure, although the feeling seems to be that the jilted EU will impost tariffs of up to 10 percent on UK exports. It's likely that the UK will reciprocate, and thus it'll be more expensive to buy a European-made car in the UK. Both situations will likely negatively affect the country, as both production of new cars and sales to UK consumers will both fall. Evercore Automotive Research figures the combined damage will be roughly $9b in lost profits to automakers, and an as-of-yet unquantified impact on auto production jobs. Perhaps the EU's leaders in Brussels will be in a better mood in two years, and the process won't devolve into a trade war. In the immediate wake of the Brexit vote, though, the mood is grim, the EU leadership is angry, and investors are spooked.

Automakers suspend some business in Russia following invasion

These Russian GAZ Tigr infantry mobility vehicles were destroyed by Ukrainian fighters in Kharkiv on Monday. (Getty Images)   Global auto and truck makers, including Sweden's Volvo Cars and Germany's Daimler Truck, on Monday suspended some business in Russia following that country's invasion of Ukraine. Russian forces invaded Ukraine last week, marking the biggest attack by one state against another in Europe since World War II. Many firms have idled operations in Russia following Western sanctions against Russia. Energy giant BP Plc, Russia's biggest foreign investor, abruptly announced over the weekend it was abandoning its 20% stake in state-controlled Rosneft at a cost of up to $25 billion. On Monday, Swedish automaker Volvo Cars said it would suspend car shipments to the Russian market until further notice, becoming the first international automaker to do so as sanctions over the invasion continue to bite. In a statement, the company said it had made the decision because of "potential risks associated with trading material with Russia, including the sanctions imposed by the EU and US." "Volvo Cars will not deliver any cars to the Russian market until further notice," it said. A Volvo spokesman said the carmaker exports vehicles to Russia from plants in Sweden, China and the United States. This came as Russia warned Sweden and Finland not to join NATO or risk facing “serious military-political consequences." Volvo sold around 9,000 cars in Russia in 2021, based on industry data. Earlier on Monday, RIA news agency reported Volkswagen had temporarily suspended deliveries of cars already in Russia to local dealerships, citing a company statement. VW had no immediate comment when contacted by Reuters. VW previously said it would halt production for a few days this week at two German factories after a delay in getting parts made in Ukraine. Daimler Truck said on Monday it would freeze its business activities in Russia with immediate effect, including its cooperation with Russian truck maker Kamaz. Mercedes-Benz Group is also looking into legal options to divest its 15% stake in Kamaz as quickly as possible, the Handelsblatt newspaper reported. A Mercedes spokesperson told Reuters business activities would have to be re-evaluated in light of the current events. Mercedes-Benz Group, formerly Daimler AG, was the parent company of Daimler Truck before the truck maker was spun off.