Volkswagen Sales Plummet After Emissions Scandal

The German automaker reports that November U.S. sales fell nearly 25 per cent from a year ago.

Volkswagen has admitted that 482,000 two-litre diesel vehicles in the USA contained cheat software that turn pollution controls on for government tests and off for real-world driving.

VW sold 23,882 cars during the period, compared with 31,725 over the same period a year ago.

Volkswagen already was struggling to make headway in the USA before the emissions-cheating scandal emerged, falling behind companies it traditionally led, such as Fuji Heavy Industries Ltd.’s Subaru brand.

There were some bright spots in VW’s results. Tiguan sales surged by nearly 88 percent, and GTI numbers were up by almost 14 percent. Both Jetta and Passat took big sales hits in November. Volkswagen sales had been growing since then, as the new Golf arrived in dealerships. It is facing slowing orders for new cars, its labour boss said, with consumers shunning purchases after news of the cheating broke in September. It also faces rigging accusations over its 3-liter diesel V-6s as well in VWs and its sister brands, Audi and Porsche.

“Volkswagen in September halted sales of almost 500,000 diesel-powered vehicles with two-liter engines sold in the USA since 2008 that contained illegal software capable of duping emissions tests”.

Once a fix is in place for Volkswagen’s diesel engines, there are still questions about whether vehicle buyers will return to buy TDIs, said Alec Gutierrez, senior analyst for Kelley Blue Book.

VW has admitted installing “defeat devices” in an estimated 11 million vehicles worldwide.

“It could be a very challenging December and start to 2016 for the brand”, Anand said.

The sales drop is roughly equal to percent of diesels that VW has typically been selling in the USA – about one out of every four new cars that move off the lot.

The VW brand sold 490,000 vehicles worldwide in October, 5% fewer than the year before. Other auto makers continued posting sales gains in November amid a booming market buoyed by low gas prices and interest rates.