2005 Vw Passat Wagon Tdi on 2040-cars

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Volkswagen pushed back against Takata airbag recall

Volkswagen and Audi will recall about 850,000 vehicles in the US to replace their Takata-supplied driver side airbag inflators, but the automaker doesn't believe the safety campaign is entirely necessary. In a letter to the National Highway Traffic Safety Administration, the company pushes the agency to re-evaluate the recall's scope because the parts are allegedly safe, it claims. VW asserted in the letter, which NHTSA posted online (as a PDF) with other documents about the company's safety campaign, that the vast majority of the automaker's recalled vehicles used Takata inflators from the supplier's factory in Freiburg, Germany. Only the US-built Passat had components from Takata's plant in Mexico. VW's argues to NHTSA that its recall is unnecessary because there are no reported airbag ruptures in the German-made parts, and the plant has better quality control than Takata's factories in the US and Mexico. In addition, the Mexico-manufactured components in the Passat are also allegedly safe because they come from a time after significant upgrades to the plant to address humidity and welding concerns. "We do not believe the facts known to date support the scope as defined in the Takata defect notification," VW's letter says. To be clear, VW is not refusing the Takata recall and plans to fix the affected vehicles. Instead, this letter shows the automaker expressing an opinion that NHTSA's scope for the campaign is too broad. VW now plans to do its own analysis on the inflators to strengthen that case, according to The Detroit News. "We respectfully request that, should such results be shown, the agency work with Volkswagen and other manufacturers to revisit the scope of these recalls," the letter said. Takata's recalled inflators use ammonium nitrate as a propellant, and experts believe that long-term exposure to high humidity can make the chemical more likely to cause a rupture during airbag deployment. The spray of metal shrapnel from the exploding parts has links to at least 10 deaths. Related Video:

How should Volkswagen deal with its diesel problems?

The hounds of hell are bearing down on Volkswagen in the wake of allegations of cheating on diesel emissions testing. In just a single day, Volkswagen's stock has dropped 23 percent and the German government has announced that it is going to investigate a far larger number of vehicles over emissions violations. The American storm is quickly becoming a global one. Volkswagen sells over a million diesel vehicles a year and also has more than 13 percent of the automotive market overall – it was the number one automaker in the world up until the scandal. Yet in a matter of hours, Volkswagen has also become a pariah with potential fines and recalls that may be dwarfed by how the alleged lies and deceit change how governments and consumers view the company. Consumers are really going to be the key to the company's survival. It's those consumers who are really going to be the key to the company's survival. Every single one of them now finds themselves with a product that was sold illegally and may not be registered until recall work is done. What's worse is that Volkswagen doesn't yet have a solution for the emissions issue to offer these customers. It should also be noted that this is not the first time Volkswagen has found itself in violation of EPA emission regulations. Volkswagen is in a world of trouble, so what now? As a car dealer and former financial analyst who took several companies public, I believe Volkswagen can and should consider three points of action that would make an enduring difference in the times to come. 1. Offer affected TDI owners a compelling reason to stay with the brand. Recall work and a cup of coffee at the dealership are not going to be enough to placate current owners. Volkswagen should provide compensation for customers at the earliest opportunity and offer some type of inducement that keeps them within the fold. This shouldn't be the industry's version of a Chuck E. Cheese coupon - a small discount on a new vehicle. Volkswagen needs to offer something along the lines of a strong warranty extension of the entire powertrain (not just the emissions system) or some type of valuable feature upgrade for these vehicles so that owners feel that they have been treated fairly. Perhaps a combination of a brand new navigation system, software upgrades for the infotainment components, or some type of basic free WiFi service would be a healthy act of generosity.

If VW defaults on loans it may sell Bentley or Lamborghini

If something goes catastrophically wrong with Volkswagen Group's recent $21 billion loan, brands like Bentley or Lamborghini could hit the auction block. According to two insiders to Reuters, the beleaguered German automaker agrees with its creditors to sell assets if the company somehow can't pay back the debt in a year. One of these anonymous people claimed the company hasn't yet deliberated over what to sell. However, the sources were willing to speculate that the power engineering portion of Man could be among the first to go. "Volkswagen may also consider divesting luxury car brands Bentley and Lamborghini or motor bike brand Ducati, although these units don't really move the needle," an insider said to Reuters. VW Group negotiated with the banks earlier this week to get the massive loan. The cash is necessary as a buffer in case the automaker doesn't have enough money on hand to repair vehicles or settle upcoming fines. VW would reportedly issue bonds in the spring to begin paying the debt. The company's bills will start racking up quickly in the new year. German authorities mandate a recall there in early 2016, and repair campaigns in the US for the 2.0- and 3.0-liter diesel engines are inevitable. There are also hundreds of class-action lawsuits to settle. The company needs to resolve its CO2 emissions scandal in Europe, too. In response to these financial threats, VW management created a cost-cutting plan to slash the research and development budget by $1.1 billion next year.