Volkswagen's woes

Dieselgate Dogs VW

WOLFSBURG, GERMANY - APRIL 28: Matthias Mueller (R), CEO of German automaker Volkswagen AG, shows Karlheinz Blessing, Volkswagen's head of human resources, the inside of Mueller's briefcase as the two men arrive at the company's annual press conference on April 28, 2016 in Wolfsburg, Germany. Volkswagen is facing high costs and stiff penalties, including the possible buyback of up to 500,000 cars it sold in the USA, as a reult of VW's diesel emissions scandal. (Photo by Sean Gallup/Getty Images)
Board members at the beleaguered carmaker sought to put the past behind them and focus on a brighter future.
  • Why it matters

    Why it matters

    Volkswagen is striving to regain trust following last year’s emissions rigging scandal, but the repercussions are likely to continue for some time and the company is reacting only slowly to make the expected changes.

  • Facts

    Facts

    • Even without the effects of the emissions scandal, the operating margin of the core VW brand is weak, at just 2.0 percent.
    • Chief executive Matthias Müller is working on a new strategy, which he plans to present in June.
    • Experts are calling for a reform of the company’s complex remuneration system following the publication of managers’ bonuses for 2015.
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    Audio

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At the annual photo shoot before VW’s accounts press conference kicked off, the managers on the board lined up for the cameras as usual.

But little else that was business as usual at the presentation as Volkswagen sought to distance itself from the past year’s struggles and focus on a bright new future.

The location of the press conference was more modest, in Wolfsburg where the company’s headquarters is located, a fitting decision for a company trying to underline not a flashy location but modesty, frugality and closeness to customers.

These aren’t areas where the company has distinguished itself and the change of tack is due to the group’s disastrous figures for 2015, the year it was found to have been rigging the results of diesel emissions tests. VW had to set aside €16.2 billion ($18.36 billion) for fines and technical improvements, leaving it with a net loss of billions.

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