A year and a half after Volkswagen's "dieselgate" erupted, Paris prosecutors are probing Renault over possible "cheating" in diesel emissions, sending the carmaker's shares sliding on the stock exchange.
A year and a half after Volkswagen’s “dieselgate” erupted, Paris prosecutors are probing Renault over possible “cheating” in diesel emissions, sending the carmaker’s shares sliding on the stock exchange. While VW is still counting the cost of an unprecedented emissions scandal that shook not only the auto sector, but the whole of German industry to the core, similar allegations are now being levied against other carmakers, notably Italian-American giant Fiat Chrysler and France’s Renault.
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Just a day after US officials said VW would plead guilty to three criminal charges and pay a total of USD 4.3 billion in fines to settle its scandal, the US Environmental Protection Agency charged that Fiat Chrysler had hidden software on diesel trucks that allowed them to spew out excess emissions. And then today, prosecutors said they’d look into possible cheating by Renault after independent French experts found dangerously high levels of emissions from diesel engines of several carmakers, including Renault. Renault shares plunged, closing 2.9 per cent lower on the Paris stock exchange at 83.76 euros, while the overall CAC 40 index rose 1.2 per cent. The shares had plunged by more than more than four percent immediately after the announcement. Renault insisted its engines complied “with French and European regulations”. “Renault vehicles are all and have always been homologated in accordance with the laws and regulations. They are compliant with the applicable standards. “Renault vehicles are not equipped with cheating software affecting anti-pollution systems.”
For its part, Fiat Chrysler also denied the charges and pledged to work with President-elect Donald Trump’s adminstration to resolve the issue “fairly”. But Britain has lodged an urgent request with US authorities for information on the allegations against Fiat Chrysler. The EPA said undisclosed software on the 2014 to 2016 models of Grand Cherokees and Dodge Ram 1500 trucks sold in the United States allowed the vehicles to emit more nitrogen oxides than permitted.
The EPA is working with the California Air Resources Board (CARB), which originally accused VW and is also investigating Fiat Chrysler. Despite the accusations, Fiat Chrysler reaffirmed its earnings targets for 2018. “We confirm our targets. This issue won’t impact our programmes,” Fiat Chrysler chief Sergio Marchionne said in an interview with a number of Italian media. The group is aiming to lift sales to 136 billion euros by 2018, compared with 113 billion euros in 2015. Bottom-line profits are projected to come out at 4.7-5.5 billion euros, compared with two billion euros in 2015. But the EPA said that Fiat Chrysler could face fines of up to USD 4.6 billion. “We haven’t committed any fraud. This is not at all comparable to the Volskwagen affair,” said chief executive Marchionne.