Emission Scandal Contracts VW European Sales The Most, Pushing Recalls To Fix The Vehicles

By Staff Writer

Feb 17, 2016 05:52 AM EST

The world's famous car brand Volkswagen had to receive its greatest contraction in sales last January since the German-based automotive company was immersed in an emission scandal on its diesel.

According to the New York Times, ACEA, which is the European carmaker's affiliation, Volkswagen's sales plunged 3.8 percent compared to the sales gained a year ago. It has influenced the whole group, including the Audi, Porsche, Seat and Skoda brands. There was only 0.8 percent growth achieved by VW group, "seriously lagging a European market that grew 6.2 percent for the 29th straight month of expansion."

The 1 million car sales in January were "empowering for the not so distant future, as the upward market pattern stays stable," ACEA added. Meanwhile, other mass-market carmakers, such as Fiat Chrysler, Ford and Opel were able to obtain double-digit picks up. Premium producers BMW and Daimler increased by 4 percent and 8.5 percent.

Bloomberg mentioned that the Europe's largest car producer is working hard to solve the problems caused by its September admission that it manipulated its diesel engine line to fulfill the emissions standards during the test only.

Therefore, Volkswagen started recollects in January to maintain cars, which have problems with the rigged emission system. This has been done in Europe, where the repairs have been agreed by the officials. The absence of an understanding with U.S. authorities has led the company to postpone its yearly shareholders meeting in February since it couldn't evaluate costs for its 2015 profit report.

Volkswagen seems to become the target of its rivals. Fiat dealers in Germany offered refunds around 14.4 percent off the sticker price. It brings the company to be the number one discounter in the home market of Volkswagen. The third position was Ford with 13.7 percent rebates. The normal discount offered in the industry was 12.1 percent.

While in Germany, the sales decreased to 8.8 percent, the U.K. market was worse with 14 percent drop. Spain sales remained safe with 12 percent increase in the demand. However, Seat, another Volkswagen division influenced by the diesel issue, reported posted a 17 percent drop in Spain, which is the home market for this division.

Autoexpress shared CEO Matthias Mueller statement, "We're working on an effective package for all our customers. There will be an attractive package, let's call it compensation, for the reduction in value of cars." However, the U.K. customers will not receive any compensations as stated by a spokesman, "There won't be compensation. All the indications are that residual values are unaffected."  

Volkswagen still needs to struggle to get back its customers' sympathy after the emission scandal, which has damaged their reputation as the high-quality car brand in the world. The scandal was somehow a disgrace for the car manufacturer. They need to fix their name in the industry in order to gain more sales.  

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