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VW will delay projects to cope with diesel scandal

Volkswagen's diesel emissions scandal will require the sacrifice of far more than just executives and money. It's also going to result in the cancellation of various projects, a process that new CEO Matthias Mueller said "won't be painless." "We will review all planned investments, and what isn't absolutely vital will be canceled or delayed," Mueller said while addressing the embattled company's employees. The former Porsche boss also said the money set aside by the German giant – about $7.29 billion – won't be enough to cover recall expenses, fines from governments in affected countries, and the expected deluge of lawsuits from disgruntled TDI owners. According to Bloomberg, that figure probably won't even be enough to match the fines Uncle Sam is likely charge, pegged to be around $7.4 billion, according to one analyst. It's expected that VW could delay a further push for share in the North American market, which would include a $1-billion investment in its Puebla, Mexico, factory. But it will take more than cancellations and delays, analysts claim. "It's going to be tough to find projects they could chop that will actually move the needle," JPMorgan Chase's Jose Asumendi told Bloomberg. "What they really need to do is get costs under control." That, according to Bloomberg, is already setting up a showdown between management and labor. The latter wants a reduction in VW's $17.4-billion research-and-development budget – the world's largest and more than what Ford and General Motors spend combined – while the former wants to slash personnel costs. Bloomberg also spoke to analysts who claimed the company should look into reductions in purchasing costs as well as trimming sponsorships. It's impossible to know just how extreme Volkswagen will need to get with cancellations, delays, and cost-cutting, but it's becoming increasingly clear that the effects of this scandal will likely be felt far longer than the controversies that surrounded other automakers like General Motors and Toyota. Related Video: News Source: BloombergImage Credit: John Macdougall / AFP / Getty Images Earnings/Financials Green Plants/Manufacturing Recalls Volkswagen Diesel Vehicles vw diesel scandal matthias mueller

VW says it has sold over 100,000 TDI diesels in America this year

Volkswagen Group of America has lit oil-burning fireworks to celebrate the sales of more than 100,000 TDI Clean Diesel vehicles in the US between its VW and Audi brands this year. According to VW, that means it is responsible for more than 75 percent of diesel-engined cars and SUVs sold here - perhaps not surprising when the two brands offer a total of 12 diesel models.
What might be surprising is that the number of diesels isn't far off the estimated sales of 90,000 battery electric vehicles and PHEVs, with 15,000 of those accounted for by the Tesla Model S, another 12,000 or so being the Toyota Prius PHEV.
VW's keen to play up the ease of making diesel part of your life, stressing that it doesn't need any change to the refueling infrastructure and that "this is a technology delivering real answers to society's concerns about fuel consumption and greenhouse gas emissions without compromises."

Volkswagen Routan dead, pour out a sippy cup for your little homies

America's minivan wolfpack has just gotten smaller by one. According to Automotive News, Volkswagen officials have confirmed what we've suspected for some time - the Routan is dead. Essentially a lightly reworked version of the Dodge Grand Caravan, the Routan actually hasn't been rolling off of Chrysler's Windsor, Ontario production line at all this year, but VW had yet to confirm its discontinuation. However, Jonathan Browning, CEO of VW America, has reportedly admitted that the Routan is being axed, with remaining units expected to be funneled into corporate functions for "internal purposes."
The move isn't unexpected - the Routan has never been a big seller, with just 57,650 examples moved since sales began in 2008 - peak yearly sales totaled under 16,000 units, and that was back in 2010. And while many have talked of the minivan segment shrinking, Automotive News points out that the segment actually grew 14 percent last year to 597,118 units, though it should be noted that most segments have been on sales upticks as the US economy chugs out of its recession.
So, is volume-crazy Volkswagen prepared to pass on large family vehicle sales? Probably not - the German automaker has signaled that it plans to build a three-row crossover in North America soon, and we wouldn't be surprised if it looks an awful lot like the Crossblue Concept from January's Detroit Auto Show - minus the fancy plug-in diesel powertrain.