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Old 10-05-2015, 12:52 PM   #221
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> You have a car company that intentionally went out of its way to deceive the public.

But did they damage the owner in a concrete way? I'm not sure the individual owner has standing to sue VW.
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Old 10-05-2015, 01:08 PM   #222
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Originally Posted by mpeirce View Post
> You have a car company that intentionally went out of its way to deceive the public.

But did they damage the owner in a concrete way? I'm not sure the individual owner has standing to sue VW.
They intentionally jerry rigged the emissions programming. By doing this, they artificially inflated the MPG and performance of the car. Test driving a car gives you an impression of the vehicle's capabilities. If you test drove a VW and it was more sluggish/less pep/less desirable, then many would have bought another vehicle.

By having mandatory reprogramming of the vehicle to meet emissions, the car must have a lower MPG/performance. This directly results in negative resale value.

There will also be a hit to resale value because far fewer people want to buy a VW because of this. Even though that is not directly related to the lower performance/mpg, now a VW owner has a car worth much less, due to both the fact that it has lower MPG/performance, and a much less demand due to public disinterest in the brand.

The net resale value is likely to be substantially lower due to the above 2 factors - and this is solely due to the fact that VW programmed the car in a deceitful way. Therefore, VW owners have definitely have suffered financial damages.

According to VW, there are 11,000,000 vehicles affected. Even just $1,000 decrease in car value comes to $11 BILLION in damages. And that's just the raw actual damages for just $1,000 in decreased value, which I think will - on average - be low, considering this started in 2008/2009, so the average age of effected cars is about 3 years old. Average depreciated value of a 3 year old car is only about roughly 40%, leaving maybe $12,000 book value (on average). I could easily see far more than just a $1,000 reduction in residual value (8% less) for VW cars because of this negative publicity.

And that $11B is just raw financial damages/reduction in value. It includes ZERO allowance for punitive damages (which could definitely apply in a case of intentional deceit).

And that's just directly from the car owners who own VWs. No allowance for VW dealers, gov't penalties/fines, or any lawsuits relating to air pollution/health effects. Also add in a permanently reduced car sales volume due to public distrust, and VWs future profits are likely permanently reduced, leaving less profit to handle the massive debt it would take on to pay the fines.

And reduced future profits and likely debt issuance to pay all of these costs leads to credit downgrades. Which leads to higher financing costs. Which leads to even less future profitability. Etc., etc.
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Old 10-05-2015, 02:19 PM   #223
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According to VW, there are 11,000,000 vehicles affected. Even just $1,000 decrease in car value comes to $11 BILLION in damages.
Though there are reportedly 11 million VW/Audi's affected, only about 4% of them are in the USA. I won't presume to know what fines/litigation might be in other countries when all is said and done, but American expectations may not be representative. I doubt you can extrapolate based on inflated US predictions. Again, time will tell...

Suing for lost resale is no slam dunk. You can't accurately predict resale for the long run, and there's no threshold guarantee for resale % is there?

And it's well known the MPG ratings in Europe are unrealistically high for a variety of reasons, overstated by 50% is not unheard of, and buyers know that. Drivers in other countries know they will not get anything like sticker MPG. If lawsuits based on inferior real world MPG experience was an issue, I would think all carmakers would have been dragged into European courts by now.

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For example, Volkswagen Golf TDI, a diesel compact sold in Europe and America. VW's British Web site lists its fuel economy at 46.3 m.p.g. in the city, 68.9 on the highway and 58.9 in combined driving. The same car, with the same engine and transmission, rated 30 m.p.g. city/42 highway and 34 combined in U.S. EPA tests
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Old 10-05-2015, 02:25 PM   #224
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No the German government will NEVER NEVER NEVER let VW go through a bankruptcy proceeding as the owners of the assets would change even though the business will continue. There is zero chance of any legal bankruptcy procedure I think
I could imagine a scenario where all the assets of VW are transferred to a government owned entity.

Sort of a bailout where all legal claims are discarded. To preserve jobs and such.

Time will tell if it gets to that.
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Old 10-05-2015, 03:48 PM   #225
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Though there are reportedly 11 million VW/Audi's affected, only about 4% of them are in the USA. I won't presume to know what fines/litigation might be in other countries when all is said and done, but American expectations may not be representative. I doubt you can extrapolate based on inflated US predictions. Again, time will tell...
So you are saying that the 96% of affected VWs are in countries where you can get away with selling products that are blatantly false, and NOT what you claim them to be, without any sort of penalty?

As I noted, the average age of the affected cars appears to be just 3 years old. Therefore, there is still substantial value left in the car after 3 years of depreciation. The average selling price was also probably at least $20k, and probably much higher than that. So even if these affected VWs lose just 8%-10% of their value because of reduced public demand for all VWs and those specific models because of the fraud, that is easily $1,000 per vehicle in reduced value because of VW's deception.

Do you really think these other countries will let you sell a car with pollution equipment turned off, and get away with that by simply slapping you on the wrist, and leaving the car owners with cars of permanently reduced value and not compensate them somehow, even if you ignore the punitive damages and strictly look at it from a purely 'made whole' provision (i.e. just in reduced car value).

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Suing for lost resale is no slam dunk. You can't accurately predict resale for the long run, and there's no threshold guarantee for resale % is there?
Why not simply suing based on the value at that point in time? Is it any different than if you were in a car accident and someone smashed your bumper? Would the person who's at fault hitting your bumper say "Well, if Midpack held that car another 3 years, it will depreciate down to nothing, so the smashed bumper shouldn't be worth but a few bucks!". No, you are compensated based on the drop in value at the time of the incident (or discovery). Yes, there could be some allowance for a depreciated value assuming the car owner owns the car for another few years....but the car owner has a valid beef if they say "Well, I don't want to own a car that is going to have a 10%-20% drop in MPG when the pollution control software is enabled" ,and many people may have valid reasons for wanting to get rid of their cars when the software is enabled. Which would tremendously impact resale value if/when they all sell.

And no different from a class-action lawsuit for securities that dropped due to news that wasn't released or improper management of the firm. Shareholders are 'compensated' based on the drop in value from one point in time to another, regardless of whether they still own the stock or sold it, or what the future prospects of the stock value will be (yes, I know that class action securities lawsuits are of dubious value....but my point is that the legal framework is based on the value at that point in time, not always with 'future value' in mind).

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And it's well known the MPG ratings in Europe are unrealistically high for a variety of reasons, overstated by 50% is not unheard of, and buyers know that. Drivers in other countries know they will not get anything like sticker MPG. If lawsuits based on inferior real world MPG experience was an issue, I would think all carmakers would have been dragged into European courts by now.
To start with - please don't tell me someone is looking at a British website with British statistics/units, and not converting to be on an apples-to-apples comparison to a US statistic. Yes, there is still a large difference in fuel efficiency between the two agencies - but when even the most basic thought of reconversion is ignored, it doesn't solidify one's argument.

Secondly, the 'overstatement' is immaterial. If the EPA supposedly 'overstates' the ideal MPG under ideal driving conditions for all cars, then everyone knows that it is based on certain driving conditions that are optimal. (not that I've personally seen a big difference in my Kia Soul, as it has been within 1mpg, on average over the course of a year, to the sticker MPG). But when a manufacturer publishes a mpg that is allegedly 'overstated' like all others - and that overstatement is based on pollution control software being disabled, and THAT 'overstatement' is materially higher than when the pollution control software is on, then consumers basing their purchases on that mpg number were lied to, because they only discounted the mpg from the EPA figure, not an additional discount based on pollution control software as well.

Even if we allow your claim to be correct - that "every car mpg is overinflated because the test conditions aren't real-world" - then how much more will the VW actual MPG differ once the pollution-control equpiment is functioning as it is supposed to? There is still a difference between what the 'real world' MPG will be with pollution control equipment working (even lower), vs turned-off.

According to Car and Driver, the EPA relies solely on the manufacturer for estimates in about 85% of the cases:

Quote:
in reality, just 18 of the EPA’s 17,000 employees work in the automobile-testing department in Ann Arbor, Michigan, examining 200 to 250 vehicles a year, or roughly 15 percent of new models. As to that other 85 percent, the EPA takes automakers at their word—without any testing—accepting submitted results as accurate.
The Truth About EPA City / Highway MPG Estimates - Feature - Car and Driver

I doubt that VW would conduct MPG tests with pollution control equipment turned on, publish that low MPG figure, then turn off pollution-control equipment, sell the car, and have car owners surprised at how much higher their MPG actually is real-world vs published sales figures. There is far less to gain from that, than publishing MPG figures that are much closer to 'actual' (with pollution-control software turned off).
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Old 10-05-2015, 04:16 PM   #226
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Thanks, we'll see...
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Old 10-05-2015, 04:26 PM   #227
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In the UK the CO2 emissions, along with engine size and fuel type, determines the annual road tax of the vehicle so if the affected cars actually have higher emissions than that published then VW can also expect to be sued for loss of tax revenue. The UK has already put out a statement that existing owners of affected cars will not have to pay extra road tax.
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Old 10-05-2015, 04:34 PM   #228
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In the UK the CO2 emissions, along with engine size and fuel type, determines the annual road tax of the vehicle so if the affected cars actually have higher emissions than that published then VW can also expect to be sued for loss of tax revenue. The UK has already put out a statement that existing owners of affected cars will not have to pay extra road tax.
I just went on the UK Car tax site and looked up the tax on a 2015 Golf Diesel and can see the stated CO2 emissions as part of the tax calculation.
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Old 10-05-2015, 06:49 PM   #229
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I know that there was a discussion on the 'wrong' gas mileage from overseas.... are you aware that the gallon in the UK is not the same as a gallon here?

It is approximately 1.2 of our gallons...

It first came to my attention when we used to go out for a pint of beer and it was more than you got here....


As to loss of value... that is something that can be determined today.... I got a check from the insurance company for the loss in value of my new car when their insured ran into me... it does not matter when I sell it... the loss in value happened when he hit the car.... so I get that amount now....

I have stated it before, but I think the people who bought VW shares and lost a big percent of their investment will sue.... that is probably an easy win for them....
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Old 10-05-2015, 11:26 PM   #230
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Some perspective on VW US sales. And add to that, diesels name up a much smaller percentage of cars sold in the US as compared to Europe.
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Old 10-05-2015, 11:33 PM   #231
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Models affected in the US.
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Old 10-06-2015, 04:51 AM   #232
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Well they bet their future on pushing "clean" diesel for the U.S., and it turned out to be a mirage - not so clean.

What a major push/competitive edge turns out to be the opposite - ouch!

Which really makes me wonder how high up this was known. If a company bets their future on a technology - well you wouldn't expect them to do that if they knew the game would be up someday. The feelings of betrayal must be internal to the company as well.
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Old 10-06-2015, 07:19 AM   #233
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For example, Volkswagen Golf TDI, a diesel compact sold in Europe and America. VW's British Web site lists its fuel economy at 46.3 m.p.g. in the city, 68.9 on the highway and 58.9 in combined driving. The same car, with the same engine and transmission, rated 30 m.p.g. city/42 highway and 34 combined in U.S. EPA test.
I think it is interesting that, allowing for the difference in size between Imperial and U.S. gallons, the Euro fuel economy numbers are close to the original-style U.S. CAFE numbers. A rough comparison between EPA and CAFE numbers can be found here: http://www3.epa.gov/fueleconomy/documents/420b14015.pdf .
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Old 10-06-2015, 03:23 PM   #234
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The lawsuits begin:

West Virginia Sues VW Over Deceptive Advertising For Vehicles Equipped With “Defeat Devices” – Consumerist
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Old 10-06-2015, 03:38 PM   #235
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Bloomberg points out that the West Virginia lawsuit is just one of 229 filed against the carmaker so far, but it represents the first from one of the at least 45 states investigating the company and its vehicles.
What a circus this will be, but they brought it on themselves...
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Old 10-06-2015, 03:49 PM   #236
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What a circus this will be, but they brought it on themselves...
What's that saying? There is no such thing as bad publicity.
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Old 10-06-2015, 03:58 PM   #237
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This is the BP oil spill on wheels!
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Old 10-08-2015, 12:21 PM   #238
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House sub-comity hearings with Mr. Horn of VW video Follow live: VW's U.S. chief pins blame for diesel scandal on a "couple of software engineers" - LA Times not live. move timeline bar back to rewind. Mr Horn starts at about 2 minutes
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Old 10-08-2015, 01:54 PM   #239
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I could imagine a scenario where all the assets of VW are transferred to a government owned entity.

Sort of a bailout where all legal claims are discarded. To preserve jobs and such.

Time will tell if it gets to that.
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This is the BP oil spill on wheels!
I disagree, the BP oil spill was due to incompetence/negligence and resulted in a major environmental disaster.

The VW fiasco is due to outright deception, knowing full well what they were doing was in violation of environmental regulations.

It would be interesting if someone could quantify the damage to the environment caused by VW's deception and compare it to the environmental impact of BP's oil spill. I realize not an apples to apples comparison but it would give one some frame of reference.
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Old 10-08-2015, 06:09 PM   #240
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I disagree, the BP oil spill was due to incompetence/negligence and resulted in a major environmental disaster.

The VW fiasco is due to outright deception, knowing full well what they were doing was in violation of environmental regulations.

It would be interesting if someone could quantify the damage to the environment caused by VW's deception and compare it to the environmental impact of BP's oil spill. I realize not an apples to apples comparison but it would give one some frame of reference.
I meant from a dollars ($$$$$) perspective.

And the BP spill had some "knowledge of violation of government regulations" stuff going on also. But that is not for discussion here.
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