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article imageVolkswagen defies 'dieselgate' to boost sales in 2016

By AFP     Jan 9, 2017 in Business

Scandal-hit German carmaker Volkswagen said Monday it increased sales in 2016, despite strong headwinds after it admitted to cheating on regulatory emissions tests for millions of vehicles.

VW said it had delivered 5.99 million vehicles last year, up 2.8 percent over 2015.

While sales in the Americas and western Europe fell sharply, the German auto giant made inroads in Asia, especially China, it said in a statement.

Under pressure from US authorities, VW admitted in September 2015 to installing "defeat devices" -- designed to reduce cars' emissions of harmful nitrogen oxide when the software detected they were undergoing regulatory tests -- in 11 million vehicles worldwide.

The scandal, quickly dubbed 'dieselgate' by global media, tarnished VW's reputation and sapped sales.

In the latest damaging development, The New York Times on Monday said FBI agents had arrested Oliver Schmidt, an executive who led VW's regulatory compliance office in 2014-15, on conspiracy charges.

With the scandal impacting the US market in particular, VW sales there fell 7.6 percent in 2016, while across South America the company shipped almost 27 percent fewer vehicles.

Western Europe recorded a more moderate fall of 2.0 percent, including a 7.2 percent decline in home market Germany.

The carmaker however increased sales in Asia by 11.8 percent, including a 14-percent boost in China, while central and eastern Europe reported a 6.9-percent increase.

- Scandal far from over -

Customers in 2016 had "remained loyal to us in challenging times," said Juergen Stackmann, head of VW brand sales.

Nonetheless, the scandal appears far from over for VW.

Citing anonymous souces, the NYT said Schmidt would be arraigned in a Detroit court on Monday.

It said lawsuits filed against VW by the states of New York and Massachusetts accused Schmidt of playing a key role in efforts to conceal the emissions cheating from US regulators.

Contacted by AFP, VW said it was continuing to cooperate with the US justice department over the scandal but refused to comment on the reported arrest.

"It would not be appropriate to comment on any ongoing investigation or to discuss personnel matters," a spokesman told AFP.

Last week, the paper said the firm was close to agreeing a $2.0-billion fine with the justice department over the scandal.

VW has already agreed to settle US civil claims for a total of $15.7 billion.

Across the Atlantic, European authorities have pressured the car giant to compensate EU customers.

And in Germany, lawmakers have set up a committee of inquiry to probe how much government leaders -- including Chancellor Angela Merkel and several ministers -- knew about the emissions cheating.

Beleaguered Volkswagen in November announced a massive restructuring that will see it shift towards producing electric vehicles over the coming years, as well as slashing 30,000 jobs by 2020.

The VW group will publish sales figures for all 12 of its brands later this week.

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