Volkswagen AG said an internal probe in the wake of the diesel scandal that has engulfed the German carmaker showed irregularities in CO2 emissions affecting an additional 800,000 cars, deepening a crisis that has already cost long-time Chief Executive Officer Martin Winterkorn his job, depressed the stock price and led to ballooning provisions.
The company said the economic risk stemming from the latest finding is about 2 billion euros ($2.2 billion), according to a release on Tuesday, citing preliminary estimates. Volkswagen, based in Wolfsburg in northern Germany, said the revelations surfaced following a “comprehensive investigation to establish whether there were indications of further irregularities” after the initial findings rocked the company in September.
“VW is leaving us all speechless,” Arndt Ellinghorst, a London-based analyst at Evercore ISI in London, said in an e-mail. “It seems to us that this is another issue triggered by VW’s internal investigation and potentially related to Europe.”
The announcement comes a day after U.S. authorities faulted the manufacturer for a wider-spread use of emission-cheating software than the company had previously admitted, a claim Volkswagen initially rejected. The carmaker has already set aside 6.7 billion euros to cover fixes of the 11 million cars worldwide it has so far identified as containing the illegal software, and management has said the sum will not suffice to cover lawsuits, fines and compensation.
The revelation of more cars with emissions irregularities hits new CEO Matthias Mueller at a time when he is seeking to overcome Volkswagen’s worst crisis. Mueller, who previously ran the Porsche sports-car subsidiary, has pledged to overhaul the company’s structure, model line-up and corporate culture, which he has said must change to create a more transparent environment that can discover possible faults.
“This is a painful process, but it is our only alternative,” Mueller said in an e-mailed statement. VW “deeply regrets this situation” and “will stop at nothing and nobody” to get to the bottom of the matter, he said.
Late Monday, the company rejected U.S. Environmental Protection Agency allegations that its cheating on diesel-emissions tests included Porsche and other high-end vehicles. The new investigation centers on the Porsche Cayenne and VW Touareg sport utility vehicles and as well as larger sedans and the Q5 SUV from Audi, according to the EPA.
“This adds to the bad news,” Sascha Gommel, a Frankfurt-based analyst at Commerzbank AG said by phone. “You can of course argue that they pursue a rigorous approach in identifying wrongdoings in the company, but this latest news is clearly negative for the company and you will see this in tomorrow’s share price for sure.”
The diesel scandal has weighed heavily on Volkswagen’s earnings and stock performance, and the company reported its first quarterly loss last month in at least 15 years because of the reserves set aside to implement fixes. The stock has lost more than a a third of its value this year, valuing Europe’s largest carmaker at about 56 billion euros.
Volkswagen’s American depositary receipts fell 2 percent at 1:48 p.m. in New York after earlier trading up as much as 1.6 percent.