Bailout World: Volkswagen "Cheating" Fine Is 20 Times Higher Than GM's For 'Killing 174 People'

Tyler Durden's picture

When bailout-darling GM 'fessed up to an intentional ignition-switch defect, tied to at least 174 deaths, The Justice Department fined them $900 million (and no employees faced criminal charges). So, in this consequence-less world in which we live, when Volkswagen admits to literally cheating emissions-standards tests, it faces up to $18 billion in fines from The EPA, one has to wonder whether "we" have our priorities right?


VW shares have been monkey-hammered this morning after the "cheating" scandal was exposed...


As The Washington Post reports,

For hiding a fatal ignition-switch defect tied to at least 174 deaths, General Motors employees will face no criminal charges and the automaker will pay a $900 million fine — less than a third of its $2.8 billion in profit last year.


The settlement with the Department of Justice, announced Thursday, signals a close to the criminal investigation that has long tarnished the car giant. But critics say the automaker got off easy for mishandling one of the worst auto safety crises in history, and years of lying to safety regulators and leaving Americans at risk.


“I have a saying about GM: There’s no problem too big that money can’t solve,” said Clarence Ditlow, executive director of the Center for Auto Safety. GM “is buying [its] way out of a criminal prosecution.”

GM’s penalty is also less than the record-setting $1.2 billion fine levied on Toyota last year after the Japanese car giant failed to recall cars that could suddenly accelerate, even though federal regulators say the defect has been linked to at least five deaths.

So, as The Telegraph reports, VW could face huge fines if it is found to have violated America’s Clean Air Act, as US watchdogs claimed it has done. The EPA has the power to impose a $37,500 penalty per vehicle in contravention of law, meaning VW could face a theoretical penalty of $18bn for the 482,000 cars affected.

Allegations first surfaced late on Friday that America’s Environmental Protection Agency (EPA) believed VW fitted “defeat devices” to almost 500,000 of its diesel cars sold in the US.


According to the watchdog, these pieces of software sensed when a car was being tested for the amount of pollution it produced and activated full emissions controls.


However, the EPA claims that during normal driving, emissions control systems were not as effective, meaning cars pumped out far more pollutants, such Nitrous Oxides (NOx), which have been linked to serious respiratory diseases.




Having initially remained quiet after news broke, other than to say it was co-operating with the US authorities, VW broke its silence yesterday with Mr Winterkorn saying he was “personally deeply sorry that we have broken the trust of our customers and the public”.


Mr Winterkorn, who only recently won a power struggle that saw Ferdinand Piech ousted as VW chairman, added that “the trust of our customers and the public is and continues to be our most important asset” and that VW “does not and will not tolerate violations of any kind of our internal rules or of the law”.

*  *  *

It appears, Volkswagen needs to "spend" a little more to ensure its immunity.


Or implement another mega squeeze in the stock and crush everyone....

Back in 2008, Volkswagen briefly became the most expensive stock in the world on what would become the case study of an epic short squeeze when following some (malicious) capital structure drama, the short interest became greater than the total outstanding float, sending the stock up 500% in a few short weeks. German billionaire Adolf Merckle committed suicide as a result.


Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
astoriajoe's picture

Yes. Humans bad. CO2 bad. 

Less humans good. Less co2 good. 

NoDebt's picture

Less humans good, less C02 irrelevant except it provides a good cover story for the "less humans" agenda.

And isn't it FEWER humans?

Haus-Targaryen's picture

$18 Billion is years worth of profits from VW NA.  

astoriajoe's picture

I wonder if they say, you know, maybe NA isn't a place we want to invest more capital. 

nuubee's picture

A small business owner through bad management allows his company to ship peanut butter laced with salmonella. 9 people died. He may face life in prison for letting this happen.

General Motors kills 174 people through similarly bad management. There is no criminal prosecution, only a slap-on-the-wrist fine.

Toyota likewise, through bad management and poor bug testing, kills maybe 1 person (? correct me here), for their cruise control software, mostly a slap-on-the-wrist fine, no criminal trial.

VW has software that alters emissions based on whether or not it's being tested. I applaud the nascar-like "beating-the-system" attitude myself. However the government decides they need to be fined to levels not seen since the Deepwater Horizon disaster.

And the elites think we should take the law seriously?

Bangin7GramRocks's picture

How about they all go to jail. For fucks sake people, you can't use other bullshit outcomes to say that this asshole company doesn't deserve severe punishment. They make shitty cars anyway.

kaiserhoff's picture

Another "hair on fire" piece,

   That is the maximum possible fine.  The recall is on, and the actual fine will be far less.

Gaius Frakkin' Baltar's picture

This is why we bought a VW. That and the fact they don't spy on you... yet.

Theosebes Goodfellow's picture

I'd like to point out that the original GM "fine" was the entire company. The bond holders at the time reallly took a jailhouse tryst sans lube. So $18 biggies, all though a tidy sum, is not more than what GM shareholders and bond holders lost. The reason the "New GM", (union owned), got off so lightly should be obvious.

Confused's picture

Exactly. Purely an estimate, which equates to what is essentially more per car than (on average) the cars were purchased for. Never going to happen. 

The Chief's picture

They make outstanding cars. They smoke the competition in every class that they compete in, and that is the reason for this bullshit recall. Go to jail? Youre insane.

de3de8's picture

I have one of these 2.0 diesels and love it, great car, been trouble free to now (82k+ miles). If they recall for a Rube Goldberg patch that saps power and/or mileage not going to take it in. Question is will I then be the criminal the epa nazi's go after.

bentaxle's picture

Yeah, but it's nice to see some cracks in that oh so high and mighty German superiority.

JRobby's picture


"And the elites think we should take the law seriously?" 

Situational application of statute: over-charging/punishing or under charging/punishing depending on the defendant.

Be safe, be smart.

froze25's picture

So what happened to the EPA for poisoning a River?

mtl4's picture

Why is this fine thing so hard to comprehend........US automaker = small fine and Foreign automaker = big fine

Works the same as with the banks too so the whole system is quite consistent.

Sanity Bear's picture

And one has to wonder whether the real reason for this event is the US putting pressure on the German government to accept jihadifugees

Zero-Hegemon's picture

So what happened to the EPA for poisoning a River?

Nothing, public sector privilege. Some low-level functionary may or may not have had his desk moved to the basement.

ZD1's picture

Big government thugs from the EPA are punishing VW NA for not hiring union thugs at VW's plants in the U.S. 

Meanwhile, Gina McCarthy, the mean looking dyke with the butch haircut who was appointed by Obama to head the EPA, gets to keep her job after the EPA poisoned rivers in three states.


bania's picture

just bought a VW diesel wagon, i get 1000km/600mi per tank, great car


i guess it's ironic they're cheating on the emissions test, but their vehicles can go 1/2 way across North America on a single tank.

pods's picture

They are getting that mileage because they are cheating on the emissions.

If they had to meet specs (not saying anything about the specs themselves) the mileage would be a lot lower.

Still, that kind of fine would be more suited to, say, selling aborted baby parts to buy a lambo.

Forgot we are in Wonderland though.



TuPhat's picture

600 miles will only get you halfway across Texas.

NidStyles's picture

If you don't go insane driving across it first. 

Dead Man Walking's picture

by definition, if they get the better mileage than other cars, they pollute less than other cars, epa test or no.  You can't tell me chevrolet doesn't do the same with it's diesel cars.

MayIMommaDogFace2theBananaPatch's picture

2600 miles is the shortest coast-to-coast route.

Huh Reeeally's picture

You looking at the right map? Shortest route I see is Houston to San Diego, about 1400 miles.... It's a little over 1200 miles just to cross the province on Ontario.

Does it really matter? I pay 0.10/km, or just under 0.20/mi, same as my last car. Wake me up when fuel efficiency is a reality.

dicksburnt's picture

This is what happens when your nation asks for its BARBAROUS RELICS back.

The nipponese know better and understand 'vassalage' even more so than Canadians. (trying telling that to a canuck and he will start waving a maple leaf shouting "go leafs, go")

Huh Reeeally's picture

Funny, I voted you up. We're - Canadians - resigned to living next to the biggest bully on the block, doesn't mean we enjoy it. Oh, and GO HABS GO!

NoDebt's picture

<--- $18 billion in the government coffers, baby!

<--- Less than $18 billion.  Like A LOT LESS.

Arnold's picture

Some body was having a bad hair and maff day when they proposed that fine for passing emmision compliance as regulated.

Smarties always get around regulation.

nnnnnn's picture
nnnnnn (not verified) Sep 21, 2015 10:48 AM



vw is less jew owned than gm


did you know that gm owned opel was payed reparations by usa after usa bombed the factorys of opel in nazi germany?

Squid Viscous's picture

so let's change the joke to how many jews can you fit in a Chevy Malibu...

nnnnnn's picture

120000 will fit in the ashtray

markovchainey's picture

Makes me want to buy one of those VWs before they fix the "problem".  Screw the EPA.

NoDebt's picture

That's exactly what I was thinking- those must be some damned good cars if the EPA wants them all crushed.

RopeADope's picture

Bluemotions get nearly 80 mpg.

A somewhat embarrassing number to the government, in many ways.

de3de8's picture

Sorry, immediate stop sale on units in stock and epa not certifying 2016 model year diesels

Bunghole's picture

Nein, nein, nein!

VAG needs to tell USEPA to suck a bag of dicks.

redux2redux's picture

There is a BIG difference: GM lied to the sheeple, VW lied to a government agency.

Cognitive Dissonance's picture

It's not nice to fool with mother nature government.

Trucker Glock's picture

Didn't GM lie to regulators and Congress?  Maybe I'm wrong.

Rehab Willie's picture

Zee Germans can afford anything

Calmyourself's picture

I'm sure we can just keep a little gold we were just going to send back...  Oh well, take that gold off the pallets boys, back in the vault..

PontifexMaximus's picture

GM does not make money and is a US company. VW makes money and is a German company, as simple as that. You can not take from where nothing can be taken, even when 1000 people die.

mkkby's picture

Are you all really THIS DUMB???

GM = UAW = long time friend of democratic party = lots of blue team votes.

Toyota/VW are foreign companies.  No votes or lobbying dollars to politicians, which makes them the ideal target for extortion.

Supernova Born's picture

International data streams hold more "gold" than Sutter's Creek.

HardlyZero's picture

No fahrvergnügen for you !

_SILENCER's picture

I heard this from that Lord Mockton cat:

The Greens are too Yellow to admit they're really Red.