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Skoda plans big investment into electric cars as part of rebound effort

PRAGUE — Czech carmaker Skoda, part of the Volkswagen Group, said on Wednesday it would invest around 2.5 billion euros over the next five years on future technologies, with more than half going to electric vehicle investment. The Czech Republic's largest exporter is hoping for a rebound in 2021 from a global car sales drop but faces uncertainty over the coronavirus pandemic and a semiconductor shortage rattling the industry. "This year is likely to be another big challenge," finance director Klaus-Dieter Schuermann said. "We expect Skoda Auto's group performance to improve, with sales revenue significantly above the level of last year." Skoda reported on Wednesday a 54.5% drop in 2020 operating to 756 million euros ($894 million). Sales revenue dropped 13.8% to 17.1 billion euros. Global deliveries remained above 1 million cars for a seventh straight year despite a 19% drop after production outages at the outset of the pandemic and a fall in China, its biggest single market. Chief Executive Thomas Shaefer said the car company was managing the semiconductor shortage "but it will follow us for awhile" and the impact was not visible yet. Skoda's core market in Europe would be electric in the future, Shaefer said, although it was still not time to completely switch away from traditional models, which include the launch last year of a new generation of its flagship Octavia model. It has also started production of the all-electric Enyaq iV model, which is a version of Volkswagen's ID.4. Skoda plans investments of 1.4 billion euros into electromobility development as part of its five-year investment plan. Investments will also go into digitalization activities and plant modernization. Related video: Green Volkswagen Skoda Electric

VW's diesel problems could end in criminal prosecution

It's not just auto industry insiders who are re-evaluating their thoughts on VW's diesel line-up following last week's bombshell accusation that the German automaker willfully installed software in almost a half-million diesel vehicles sold in the US to get around government emissions tests. Things are moving fast in what is already being called "dieselgate," but here are some of the big news items that we've learned since VW CEO Martin Winterkorn issued an apology yesterday. The biggest news is that both the US and German governments are looking into criminal prosecutions. Here, the US Justice Department has started a criminal investigation and Germany said that its Federal Motor Transport Authority will get involved. When the full history about all of this is written, two key players will be John German and Peter Mock from the International Council on Clean Transportation. They were the researchers responsible for actually calculating the emissions, and thus discovered that what was coming out of the tailpipe and what VW was telling the EPA did not match up. Once the EPA understood what was going on, it forced VW to either explain things all of its 2016 models would not receive certification. Sales of all VW diesels in the US have indeed been stopped, and the EPA says it will take a closer look at all light-duty diesel vehicles in the US. The re-engineered 2016 Volkswagen Passat is being launched in New York today. Two senior Volkswagen executives who were supposed to attend the event - Heinz-Jakob Neusser, VW's board member in charge of technical development and Herbert Diess, chairman of the VW brand's management board - have cancelled. An Audi vehicle is among the VW Group's vehicles affected by this issue, the A3 TDI. Given that VW has admitted in some fashion to installing the "defeat device" to get around the emissions tests, Audi's slogan "Truth In Engineering" now sounds less than perfect. Yes, there is already talk of class-action lawsuits. Nothing official is out yet, but expect to hear more about this in the near future.

Volkswagen reportedly to name Matthias Muller CEO

Porsche chief executive officer Matthias Muller is expected to be named CEO of Volkswagen AG, the Wall Street Journal and other sources reported Thursday morning. Muller, 62, has led Porsche since Oct. 1, 2010, and jumpstarted the sports-car brand's expansion around the world. He replaces Martin Winkerkorn, who stepped down Wednesday amid the company's worsening diesel scandal. At least three more executives are also expected to be fired, including Volkswagen's US chief and the heads of Audi and Porsche research and development. Both brands are divisions of VW. A US spokesman wouldn't confirm the reports. An official announcement is expected at VW's board meeting on Friday. Muller's ascension caps a stunning week of turmoil for Volkswagen, which manipulated software to make its diesel-powered vehicles appear cleaner during testing that they are in real-world driving. The charges were revealed last week by the EPA, which cited the work of researchers at West Virginia University. About 482,000 vehicles are affected in the United States, which will be subject to recall, and VW estimates about 11 million of its vehicles around the world have the rigged software. The well-regarded Muller was viewed as a front-runner for the job even before Winterkorn stepped down. Before helming Porsche, he oversaw all vehicle projects globally for VW from 2007-2010. Previously, he was in charge of the Audi and Lamborghini product lines, and earlier in his career was responsible for the Audi A3 program in the 1990s. He joined Audi in 1977. He's trained as a toolmaker and studied information technology in Munich. His last name is sometimes spelled Mueller in English. Muller faces immediate challenges as he takes over VW's sprawling 78-year-old industrial empire, including recalls and regulatory actions around the world. In the US alone, the company faces a fine of up to $18 billion. VW, an industrial symbol of Germany, is also far larger than any unit Muller has run in his career. While Porsche sold 189,849 vehicles in 2014 globally, it's one of many VW brands. Collectively they sold 5.04 million vehicles through the first six months of this year, making Volkswagen the world's largest automaker. Related Video: