Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
The Volkswagen Whee ..
Old 09-22-2015, 05:50 AM   #1
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,213
The Volkswagen Whee ..

Down 40% or so in two days.

Try putting that in a fundamental value analysis or technical analysis model.

This is probably going to turn out to be systemic. As in: other automakers probably do the same thing.

Curious whether this will turn out to be an overreaction (as usually happens with those sort of thing). Not betting my money on it though.
__________________

__________________
Totoro is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 09-22-2015, 07:32 AM   #2
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 2,972
Quote:
Originally Posted by Totoro View Post
Down 40% or so in two days.

Try putting that in a fundamental value analysis or technical analysis model.

This is probably going to turn out to be systemic. As in: other automakers probably do the same thing.

Curious whether this will turn out to be an overreaction (as usually happens with those sort of thing). Not betting my money on it though.
My best guess is it will bottom out soon then gradually go back to close to where it was. So, you could buy in soon and Likely make a very good profit. I'm not confident enough to try it myself with the limited cash I have on hand though.
__________________

__________________
aaronc879 is offline   Reply With Quote
Old 09-22-2015, 07:40 AM   #3
Recycles dryer sheets
cooch96's Avatar
 
Join Date: May 2014
Location: Lakewood
Posts: 442
What most impresses me is that this scandal has been going on for so long. I would think international, corporate secrets would be nearly impossible to keep.

Maybe I will buy $1k of shares or so next week. I need to do a little more research first though.
__________________
Why be normal when you can be yourself?
cooch96 is offline   Reply With Quote
Old 09-22-2015, 07:46 AM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: Chicagoland
Posts: 11,976
When I heard yesterday, I assumed the emissions testing 'software cheat' reduced emissions by something like 10-50% - until this morning.

WOW.

Good luck to those reselling any of the 5 VW or Audi engine/model combinations affected. Not with my 10-foot pole...

https://www.techdirt.com/articles/20...g-things.shtml

Quote:
The "switch" senses whether the vehicle is being tested or not based on various inputs including the position of the steering wheel, vehicle speed, the duration of the engine's operation, and barometric pressure. These inputs precisely track the parameters of the federal test procedure used for emission testing for EPA certification purposes. During EPA emission testing, the vehicles' ECM [electronic control module] ran software which produced compliant emission results under an ECM calibration that VW referred to as the "dyno calibration" (referring to the equipment used in emission testing, called a dynamometer). At all other times during normal vehicle operation, the "switch" was activated and the vehicle ECM software ran a separate "road calibration" which reduced the effectiveness of the emission control system (specifically the selective catalytic reduction or the lean NOx [nitrous oxides] trap.) As a result, emission of NOx increased by a factor of 10 to 40 times above the EPA compliant levels, depending on the type of drive cycle (e.g. city, highway).
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 09-22-2015, 08:14 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
easysurfer's Avatar
 
Join Date: Jun 2008
Posts: 7,890
Definitely in the "They did what?" category. Some heads are gonna roll.
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
easysurfer is online now   Reply With Quote
Old 09-22-2015, 09:00 AM   #6
Thinks s/he gets paid by the post
 
Join Date: Aug 2004
Location: Laurel, MD
Posts: 2,951
I worked in an auto emission lab in the 80's where we conducted EPA dyno testing for self compliance and emission audits for EPA and CARB. A lot of info was shared with government agencies and even competitors. The potential to cheat in this form was so obvious to us that no one would have dreamed of actually trying to do it. Our software and controls were primitive compared to what is available now. A few heavy duty diesel suppliers were caught doing something similar a few years ago. It's surprising if this was going on at only one supplier and the others were completely unaware.
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
jazz4cash is offline   Reply With Quote
Old 09-22-2015, 09:11 AM   #7
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Posts: 1,661
Interesting.... has anyone found what would change in the car performance if they ran the cheat all the time. I would assume it would then be compliant at least with emissions.

I would assume that all cars these days modify settings based on conditions. Older cars did this more mechanically. But adjusting for the test does sound like a cheat. I just wonder if they ran the cheat all the time, what do they give up? mileage? performance? It would be interesting to know... and this could be a very easy fix... just software. But what was so important to use this cheat?
__________________
bingybear is offline   Reply With Quote
Old 09-22-2015, 09:14 AM   #8
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,691
VW today announced it is taking a charge larger than the BP spill and the potential costs are more than 3 times what BP incurred at 18 billion. To advertise yourself as the "eco-green" company and intentionally release 40 times the pollutants in order to get the performance of the diesel engine that makes it fun to drive is going to result in 2 things - massively unhappy customers at being de-frauded and a car that will no longer perform as it did previously.

I would be surprised if VW stock did not have a long way to go down from here, the news coming out is going to be bad both PR and financially
__________________
Running_Man is offline   Reply With Quote
Old 09-22-2015, 09:23 AM   #9
Full time employment: Posting here.
 
Join Date: Nov 2010
Posts: 588
My first thought is how many owners will accept that type of performance hit. Unless they live in a state that requires compliance, I don't see many being turned in to be "fixed". If it gets fixed and performance isn't what was in the test drive? Fraud? Refund or lawsuit? I think this will cost VW more rather than less.
__________________
devans0 is offline   Reply With Quote
Old 09-22-2015, 09:48 AM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
easysurfer's Avatar
 
Join Date: Jun 2008
Posts: 7,890
Just curious. How was emissions gate discovered? Did someone stumble upon the software (you know, like an interception during an AFC championship game) or from a whistle blower? I doubt the VW CEO confessed just to clear his conscious.
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
easysurfer is online now   Reply With Quote
Old 09-22-2015, 09:51 AM   #11
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Posts: 1,661
Quote:
Originally Posted by easysurfer View Post
Just curious. How was emissions gate discovered? Did someone stumble upon the software (you know, like an interception during an AFC championship game) or from a whistle blower? I doubt the VW CEO confessed just to clear his conscious.
read link posted by midpack above. I think it was University testing that initially uncovered it.
__________________
bingybear is offline   Reply With Quote
Old 09-22-2015, 10:13 AM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
easysurfer's Avatar
 
Join Date: Jun 2008
Posts: 7,890
Quote:
Originally Posted by bingybear View Post
read link posted by midpack above. I think it was University testing that initially uncovered it.
Thanks. Guess I shouldn't have skimmed the link
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
easysurfer is online now   Reply With Quote
Old 09-22-2015, 10:24 AM   #13
Thinks s/he gets paid by the post
frayne's Avatar
 
Join Date: Oct 2002
Location: 19th Hole
Posts: 2,532
Personally I think some people should be going to jail and not in some country club federal prison. This is a blatant disregard for our laws. Fines will hurt the stockholders and be passed on down the road to the consumer. I will never buy a VW product.
__________________
A totally unblemished life is only for saints.
frayne is online now   Reply With Quote
Old 09-22-2015, 10:28 AM   #14
Thinks s/he gets paid by the post
 
Join Date: Mar 2011
Posts: 3,705
Waiting for someone to blame the the Patriots........
__________________
Living well is the best revenge!
Retired @ 52 in 2005
marko is online now   Reply With Quote
Old 09-22-2015, 10:31 AM   #15
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,460
From the morning FT Q&A: Why would VW cheat emissions tests? - FT.com

Quote:
The EPA in 1998 fined various makers of diesel engines for including defeat devices in the software monitoring the emissions of heavy trucks. In those cases, emissions were found to be as much as three times permitted limits. Earlier in the 1990s, both Ford of the US and Japan’s Honda paid fines for installing software that caused their vehicles to emit more pollutants than they otherwise would have done. More recently, in 2014, two Korean carmakers — Hyundai and Kia — paid fines to the EPA for overstating their vehicles’ fuel economy.
I agree with Running_Man, there's plenty of downside risk here.
__________________
MichaelB is online now   Reply With Quote
Old 09-22-2015, 11:02 AM   #16
Recycles dryer sheets
 
Join Date: Oct 2013
Posts: 204
^^ I also suspect VW is not alone in tweaking the numbers. We just bought an Altima that gets outrageous fuel economy for its size...wonder why?
__________________
.................................
A life without beer is not worth living
Nunthewiser is offline   Reply With Quote
Old 09-22-2015, 11:43 AM   #17
Thinks s/he gets paid by the post
 
Join Date: Aug 2004
Location: Laurel, MD
Posts: 2,951
Quote:
Originally Posted by easysurfer View Post
Thanks. Guess I shouldn't have skimmed the link
I read the link and it does not go into much detail about how the hack was uncovered. Interesting that VW has/had plants in the state of WV for decades, but recently built a new plant in TN...surely coincidence

As far as the tradeoff, I would think performance will take a major hit and indeed it may be difficult/impossible to get owners to bring the cars in. Eventually the software will be connected wirelessly and mandated updates will not be at the owners discretion.
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
jazz4cash is offline   Reply With Quote
Old 09-22-2015, 12:07 PM   #18
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,460
Here's a link to a Bloomberg story that gives some additional background on how this was detected. VW's Emissions Cheating Found by Curious Clean-Air Group - Bloomberg Business

West Virginia University!
__________________
MichaelB is online now   Reply With Quote
Old 09-22-2015, 12:22 PM   #19
Thinks s/he gets paid by the post
Lakewood90712's Avatar
 
Join Date: Jul 2005
Posts: 1,316
Quote:
Originally Posted by frayne View Post
Personally I think some people should be going to jail and not in some country club federal prison. This is a blatant disregard for our laws. Fines will hurt the stockholders and be passed on down the road to the consumer. I will never buy a VW product.
I have a quirky thought on penalty . 1 prohibit the registration renewal of all affected vehicles, until re-programmed at the dealer. 2, do an actuary calc. of the fuel mileage loss . These cars have plenty of power, so with the ecm /pcm ( black boxes) re-programmed to comply , so the mileage will suffer , VW to make a cash payment for diminished value to current owners, 3, determine civil penalty per vehicle affected, split half of the fine to the government, and distribute the other half to the makes of competitive diesel vehicles. How's that for a pucker factor, VW having to give money to Benz and BMW , as punishment for un-fair business practices.

Executives never go to jail, and this thing goes a whole lot lower in the management food chain. Has to be hundreds involved.

I am sure their competitors have known about this for years, but keep their mouths shut , like the Mafia never rat's on the other guy.
__________________
Lakewood90712 is offline   Reply With Quote
Old 09-22-2015, 12:39 PM   #20
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,213
Quote:
Originally Posted by Lakewood90712 View Post
I am sure their competitors have known about this for years, but keep their mouths shut , like the Mafia never rat's on the other guy.
Just as likely they are guilty themselves. We'll know within a few days.
__________________

__________________
Totoro is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Thank goodness now we know exactly when WHEE ends! Midpack FIRE and Money 20 05-11-2012 11:49 AM
Just checking in for the Whee-o-meter audreyh1 FIRE and Money 23 05-02-2011 07:02 PM
Record Dow! Whee! W2R FIRE and Money 277 11-12-2007 05:25 PM

 

 
All times are GMT -6. The time now is 10:31 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.