Volkswagen AG (ADR)(OTCMKTS:VLKAY) suspended its chief quality-control executive, Frank Tuch, in connection with the recent emissions cheating scandal. Neither Tuch nor the other four officials suspended during the probe, has been alleged with a crime. This suggests that investigators are still targeting their investigation on a group of the company’s senior executives directly associated in managing diesel-engine development, quality control and production. Of the total five suspensions so far, all officials comes from Volkswagen’s top management echelon.
Recently, Volkswagen admitted to placing a software device in its vehicles that allowed the diesel-based motor to release lower tailpipe emissions in laboratory tests compared to daily road use. Between years 2009 and 2015, the device was installed in eleven million vehicles, largely in Europe and the U.S. The chief quality-control executive Tuch was not engaged at Volkswagen in year 2008, when it is assumed that company executives decided to develop and install the device. However investigators are looking at officials who may have been aware about the defeat device and didn’t report it.
The recent update
Former Volkswagen CEO Martin Winterkorn, who gave his resignation under pressure in September in the wake of emissions scandal, tapped Tuch to direct quality control in year 2010. At the time, Tuch had left company’s Porsche sports car segment to work as CEO for Lotus Group. Winterkorn knew Tuch from Porsche as he helped Porsche rise to top position in J.D. Power quality rankings in the U.S. Winterkorn engaged him to help enhance quality at the Audi and Volkswagen brands, which usually ranked badly in such quality reviews. During Tuch’s appointment, former CEO stated said the quality-control official will bring company forward in the U.S.
In other news, Volkswagen reported that $3 billion of leases or loans for cars built with engines having emissions-cheating software were developed into asset-backed securities.
Volkswagen AG (ADR) (OTCMKTS:VLKAY) has been in a huge bear market for a long time now and the last session was just the latest display of the bearish might. The stock lost 2.13% in the last trading session, a comparatively narrow range day with the short term volatility showing signs of contraction. The corrective state may now take the form of sideways movement as the volume continues to get drier. The volume of the day at 426,000 was way lower than the daily average of 2.1 million, indicating the absence of any bottom pickers.