Don’t look now, but Renault may be pulling a Volkswagen.
The French company’s shares fell by as much as 23% on Thursday after an apparent raid on what a union official described as “sites that have to do with standards testing and engine certification.”
Earlier, AFP reported that the agents from the fraud office of France’s Economy Ministry visited the sites last week seizing computers as part of an apparent probe into emissions testing.
As Bloomberg notes, “French authorities started a probe in September into whether VW deceived customers about the emissions levels of its diesel cars and promised to expand the probe to cover all carmakers, including Renault and PSA Peugeot Citroen.”
Peurgeot shares fell nearly 10% in sympathy. In October, the automaker said it never used software to cheat emissions tests.
The news rattled carmakers from France to Germany where the market is still on edge after the Volkswagen scandal rocked the country's auto industry to the core last year.
Florent Grimaldi, the CGT labor official who spoke to the press, said the searches were conducted at company offices at Lardy near Paris. The Lardy site develops engines and ironically has been requesting more resources to work on anti-pollution systems. Apparently, the certification department was targeted.
The stock's 20% plunge is the largest single day decline in 17 years, reflecting investor fears that the scope of the probe could mirror what unfolded at its German rival.
"Separately, the country’s environmental regulator began randomly testing vehicles to check differences between emissions results found in laboratory testing and real-world figures," Bloomberg adds.
Renault initially declined to comment but has now confirmed the story and says the company is co-operating with authorities.
Is that a Renault car or just their shares? pic.twitter.com/q3usGq9rAa— RANsquawk (@RANsquawk) January 14, 2016