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Ducati is not for sale according to VW supervisory board

Volkswagen's planned sale of motorcycle brand Ducati and transmission maker Renk currently has no majority backing on the carmaker's supervisory board, with opponents to asset sales feeling invigorated by the group's strong results. Europe's largest automaker has tasked banks to evaluate options for Ducati and Renk including divesting the two divisions as it aims to streamline operations to help fund a post-dieselgate strategic overhaul. Volkswagen has been reviewing its portfolio of assets and brands since announcing in June 2016 a multi-billion-euro shift to electric cars and new mobility services as part of its so-called Strategy 2025. Five bidders have been shortlisted to buy Ducati, including Italy's Benetton family, with offers received valuing the brand at 1.3 billion-1.5 billion euros ($1.76 billion), a source said on Saturday. But VW's labour leaders, occupying half the seats on the 20-member supervisory board which decides on asset sales, resist a sale of Ducati and Renk without compelling financial reasons. "The employee representatives on Volkswagen's supervisory board will neither approve a sale of Ducati, nor one of Renk or MAN Diesel & Turbo," a spokesman for VW group's works council told Reuters late on Saturday. "Everyone who can read the VW half-year results should know: We don't need money and our subsidiaries are not up for grabs by bargain hunters." Six-month operating profit at VW group jumped 19 percent to 8.9 billion euros, the carmaker said on Thursday, as cost cuts and R&D improvements at the core namesake brand earned VW a respite from the billions of euros in costs for fines, vehicle refits and compensation related to its dieselgate scandal. One source at VW said that given strong union opposition, VW is now reviewing the plan to sell Ducati as it doesn't want to risk working with labour on implementing a hard-fought turnaround plan for the VW brand, seen as crucial by investors. Though Ducati is owned by VW's luxury brand Audi, the VW group's supervisory board has to approve a possible sale. Audi declined comment. The billionaire Porsche and Piech families, controlling 52 percent of voting shares in VW and holding four supervisory board seats, do not support selling Ducati or Renk, two other sources at VW group said. A spokesman for Porsche SE, the family's holding company, declined comment.

VW probes more diesels for emissions issues [UPDATE]

UPDATE: Volkswagen has released an official statement (embedded below) clarifying that neither the Euro 5 nor Euro 6 versions of the EA 288 contain software defeat devices. While this is the case for Europe, a VW spokesperson tells Autoblog: "Remedies and certifications for the vehicles in the United States are still subject to approval from the EPA and CARB." Volkswagen's diesel emissions scandal could mushroom to include even more vehicles in Europe because another engine there might be equipped with the cheating software. According to the company, it now needs to check whether early examples of the EA 288 for the Euro 5 standard can also evade tests, Automotive News reports. German regulators find that the later Euro 6 versions of the powerplant are compliant. VW initially said that 11 million EA 189 engines were affected worldwide by the cheating, and it recently included them in a stop-sale order in Europe. However, if the EA 288 diesels also have evasive software, they would only add to the millions of vehicles the company is already recalling there. At the same time, VW is facing a crunch to have a fix ready in time for mandated repairs to start in Germany in early 2016. New software should be enough to make most models compliant, but some of them might need more costly hardware changes. While the effects could be huge for Europe, the EA 288 has been included in VW's stop-sale in the US since Sept. 18. The engine is found on an estimated 67,000 examples of the 2015 model-year 2.0-liter TDI vehicles that the company calls Generation 3, according to spokesperson Jeannine Ginivan to Autoblog. US regulators are also taking a close look at the powerplant for evidence of VW altering its cheating software between engines. If proven, the changes might be evidence of a wider effort within the company to perpetuate the emissions evasion. Related Video: Volkswagen confirms: EA288 engines designed for EU5 and EU6 are not affected • Thorough appraisal of the Diesel emissions issue Wolfsburg, October 22, 2015. Volkswagen confirms today that no software constituting an improper defeat device as defined in law is installed in vehicles with EA 288 EU5 as well as EU6-engines in the European Union. Consequently, new vehicles of the Volkswagen Group offered within the European Union with those engines comply with legal requirements and environmental standards. Volkswagen AG is systematically reviewing this issue worldwide.

The UK votes for Brexit and it will impact automakers

It's the first morning after the United Kingdom voted for what's become known as Brexit – that is, to leave the European Union and its tariff-free internal market. Now begins a two-year process in which the UK will have to negotiate with the rest of the EU trading bloc, which is its largest export market, about many things. One of them may be tariffs, and that could severely impact any automaker that builds cars in the UK. This doesn't just mean companies that you think of as British, like Mini and Jaguar. Both of those automakers are owned by foreign companies, incidentally. Mini and Rolls-Royce are owned by BMW, Jaguar and Land Rover by Tata Motors of India, and Bentley by the VW Group. Many other automakers produce cars in the UK for sale within that country and also export to the EU. Tariffs could damage the profits of each of these companies, and perhaps cause them to shift manufacturing out of the UK, significantly damaging the country's resurgent manufacturing industry. Autonews Europe dug up some interesting numbers on that last point. Nissan, the country's second-largest auto producer, builds 475k or so cars in the UK but the vast majority are sent abroad. Toyota built 190k cars last year in Britain, of which 75 percent went to the EU and just 10 percent were sold in the country. Investors are skittish at the news. The value of the pound sterling has plummeted by 8 percent as of this writing, at one point yesterday reaching levels not seen since 1985. Shares at Tata Motors, which counts Jaguar and Land Rover as bright jewels in its portfolio, were off by nearly 12 percent according to Autonews Europe. So what happens next? No one's terribly sure, although the feeling seems to be that the jilted EU will impost tariffs of up to 10 percent on UK exports. It's likely that the UK will reciprocate, and thus it'll be more expensive to buy a European-made car in the UK. Both situations will likely negatively affect the country, as both production of new cars and sales to UK consumers will both fall. Evercore Automotive Research figures the combined damage will be roughly $9b in lost profits to automakers, and an as-of-yet unquantified impact on auto production jobs. Perhaps the EU's leaders in Brussels will be in a better mood in two years, and the process won't devolve into a trade war. In the immediate wake of the Brexit vote, though, the mood is grim, the EU leadership is angry, and investors are spooked.