Newspaper article International New York Times

VW Seeks a Softer Deal from U.S. ; Lawyers Expect Penalties That Are Painful but Not Deadly for the Automaker

Newspaper article International New York Times

VW Seeks a Softer Deal from U.S. ; Lawyers Expect Penalties That Are Painful but Not Deadly for the Automaker

Article excerpt

The carmaker also said it had set aside about $7.9 billion for legal costs worldwide, indicating that it expects fines in the United States to be much lower than some analysts have estimated.

The chief executive of Volkswagen said on Thursday that he personally apologized to President Obama this week for the company's cheating on vehicle emissions tests, while making what amounted to a plea for mercy as the German carmaker negotiates penalties with United States officials.

Volkswagen is in talks with the American authorities about the fines it must pay for programming engines to cheat on emissions tests. The company said on Thursday that it had set aside 7 billion euros, or $7.9 billion, for legal costs worldwide, indicating that it expected fines in the United States to be much lower than some analysts estimated.

Matthias Muller, the chief executive of Volkswagen, had what he described as a two-minute conversation with Mr. Obama during the president's visit this week to Hanover, Germany, not far from Volkswagen headquarters in Wolfsburg.

"I used the opportunity to personally apologize to him for our behavior," Mr. Muller said on Thursday during a news conference in Wolfsburg. "I thanked him for the constructive cooperation with his officials. Of course I also expressed the hope that I will be able to continue to fulfill my responsibility to 600,000 employees and their families as well as suppliers and dealers."

Mr. Muller's mention of Volkswagen workers and their families can be seen as a plea for American officials to not punish those who had nothing to do with any wrongdoing. Lawyers in the case expect the Environmental Protection Agency and the Department of Justice to demand penalties that are painful for Volkswagen, but not so severe that they destroy the company.

Thousands of jobs in the United States depend on Volkswagen. The company has a factory in Chattanooga, Tenn., that is preparing to produce a new version of the Tiguan compact sport utility vehicle, as well as an extensive dealer network nationwide.

The carmaker said last week that it had set aside EUR 16.2 billion to cover costs related to its admission that it had programmed diesel vehicles to evade clean air regulations. …

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