Cars and Drivers

Volkswagen to Buy Back Approximately 115,000 Cars in US -- Sueddeutsche Zeitung

Douglas A. McIntyre

Published: January 7, 2016 5:05 am

Last Updated: January 13, 2020 3:21 pm

The financial viability of Volkswagen can be questioned once again, based on rumors of a huge buy back of cars sold in the United States. According to German newspaper Sueddeutsche Zeitung, translated to English by Google Translate:

The US government has sued the Volkswagen over the years forged emissions. How many billions of dollars has sued the VW government and how much is the total penalty, for the time being remains open. Within the Group it is now expecting to have to take good care of 115 000 cars in the United States.

Based on analysis of U.S. fines faced by VW, it could owe the government $18 billion. Add to that potential fines, recalls and repair costs throughout the world. VW has 24% of the car market in the European Union. It is also among the largest manufacturers in China.

More and more frequently, analysts question whether VW has the balance sheet to take these financial hits and the damage to its reputation. The company was the largest car company in the world last year, based on unit sales. VW was expected to keep that role in 2016.

What options does VW have? First among them would be to sell its huge luxury division Audi. It could be worth tens of billions of dollars, based on the market value of publicly traded BMW.

VW almost certainly will come out of the current catastrophe a smaller company, if it remains an independent company at all.