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VW recalls another 6,700 vehicles over fuel leak [UPDATE]

UPDATE: An earlier version of this post suggested that the expanded recall involved an additional 44,658 units, when VW tells us that is in fact the total number - adding a further 6,679 to the original recall of 37,979. The text below has been updated accordingly, with our apologies for the confusion. It was a little over a month ago that Volkswagen issued a recall for some 38,000 vehicles over a potential fuel leak. Now the German automaker and the National Highway Traffic Safety Administration have expanded that recall, affecting even more vehicles for the same issue. The problem revolves around a sealing cap at the fuel rail, which could fail and cause fuel to leak into the engine compartment, thereby increasing the risk of a fire. This time around, VW is calling in a selection of Jettas, Passats, Golfs, GTIs, Beetles and Beetle Convertibles, all of them from the 2014 and 2015 model years (except the Golf and GTI, of which only 2015 models are being recalled). The recall now affects an estimated additional 6,679 units, which (in addition to the 37,979 recalled previously) brings the total up to 44,658 vehicles across the United States. RECALL Subject : Fuel Leaking Into Engine Compartment Report Receipt Date: JAN 23, 2015 NHTSA Campaign Number: 15V028000 Component(s): FUEL SYSTEM, GASOLINE Potential Number of Units Affected: 44,658 Manufacturer: Volkswagen Group of America, Inc. SUMMARY: Volkswagen Group of America, Inc. (Volkswagen) is recalling certain model year 2014-2015 Jetta vehicles manufactured March 28, 2014, to November 24, 2014, 2014-2015 Passat vehicles manufactured April 7, 2014, to November 18, 2014, 2015 Golf and GTI vehicles manufactured July 1, 2014, to November 20, 2014, and 2014-2015 Beetle and Beetle Convertible vehicles manufactured March 31, 2014, to November 27, 2014. A sealing cap at the fuel rail may fail, allowing fuel to leak into the engine compartment. CONSEQUENCE: A fuel leak, in the presence of an ignition source, can result in a vehicle fire. REMEDY: Volkswagen will notify owners, and dealers will replace the fuel rails with new parts, free of charge. The recall is expected to begin in early February 2015. Owners may contact Volkswagen customer service at 1-800-822-8987. Volkswagen's number for this recall is 24BL. Note: This recall expands and supersedes recall 14V-809 (Volkswagen recall number 24Bi) and only affects vehicles not previously repaired under that campaign.

$1.4B hedge fund suit against Porsche dismissed

Investors have canvassed courts in Europe and the US to repeatedly sue Porsche over its failed attempt to take over Volkswagen in 2008 (see here, and here and here), and they have repeatedly failed to win any cases. You can add another big loss to the tally, with Bloomberg reporting that the Stuttgart Regional Court has dismissed a 1.4-billion euro ($1.95B US) lawsuit, the decision explained by the court's assertion that the investors would have lost on their short bets even if Porsche hadn't misled them.
Examining the hedge funds' motives for stock purchases and the bets that VW share prices would fall, judge Carola Wittig said that the funds didn't base their decisions on the key bits of "misinformation," and instead were participating simply in "highly speculative and naked short selling," only to get caught out.
With other cases still pending, the continued streak of victories bodes well for Porsche's courtroom fortunes, since judges will expect new information to consider overturning precedent. If there is any new info, it could come from the potential criminal cases still outstanding against former CEO Wendelin Wiedeking and CFO Holger Härter, who were both indicted on charges of market manipulation.

VW's credit ratings could take a beating

In addition to a significant drop in its share price already, Volkswagen's diesel emissions scandal is continuing to have major financial repercussions on the German automaker. According to The Detroit News, credit rating agencies like Standard & Poor's and Moody's changed their forecasts on the company to negative, and Fitch has considered doing so, as well. Volkswagen appears to have the money to cover the costs of this ordeal, but the agencies question the effect that this has in the long term. "Moody's concern, however, is that Volkswagen's alleged breach of US environment rules and, especially, the process by which that breach occurred, will have an adverse effect on its reputation and credibility within the global passenger car markets," the company wrote in a note to investors, according to The Detroit News. VW has initially set aside $7.25 billion to fix things, but the potential shakeup of top executives has caused some investor uncertainty, too. The actual costs for VW to deal with this scandal are still unknown. In the US, the Department of Justice has begun a criminal investigation, and with other automakers the government has settled for $900 million against General Motors and $1.2 billion against Toyota. Attorneys general in 29 states have started looking deeper, according to The Detroit News, and regulators in Europe, South Korea, and Canada have commenced their own probes, as well. Related Video: