Volkswagen Probed in France Over Diesel Emissions Scandal

What the VW Scandal Means for Investors
  • French Economy Ministry started probe into Volkswagen vehicles
  • Emissions investigation to be extended to Renault, Peugeot

France is investigating whether Volkswagen AG deceived customers about the emissions levels of its diesel cars and could fine the German automaker if it’s found guilty.

A body under the authority of Economy Minister Emmanuel Macron started a probe last week into Volkswagen vehicles equipped with the defeat-device software uncovered by U.S. regulators, according to the Ministry. The probe will later be extended to all carmakers, including Renault SA and PSA Peugeot Citroen of France. Under French consumer-protection laws, companies found guilty of defrauding customers can be sanctioned or fined a percentage of sales.

The French investigation, set to last until at least the end of November, adds to a long list of civil lawsuits and criminal probes Wolfsburg-based Volkswagen is facing after it admitted to cheating on diesel-emissions tests. However, France was debating diesels even before the Volkswagen scandal emerged. Though the fuel is even more popular there than in the rest of Europe, accounting for 59 percent of newly registered vehicles last year, environmentalists and officials in Paris also blame diesel for the smog increasingly visible in the capital.

Macron said he’s confident about the French auto sector and that the Ministry must take care to prevent the Volkswagen scandal from becoming a diesel scandal.

“Volkswagengate is not dieselgate,” Macron said on Wednesday. “These are two different things."

Misleading Practices

“This investigation aims at finding the frauds on the characteristics (pollution level) of vehicles or misleading commercial practices (advertisements on abiding by standards),” the Economy Ministry said in a statement on Wednesday.

France’s Environment Ministry started a parallel investigation by randomly testing about 100 light vehicles from all brands sold in France to check the potential differences between emissions results found in laboratories and real, on-the-road figures.

State-funded discounts for car buyers who bought so-called clean vehicles should be repaid by Volkswagen, Environment Minister Segolene Royal said on Wednesday. Government spokesman Stephane Le Foll said he didn’t have an estimate of how many cars that would impact.

About 946,000 Volkswagen diesel vehicles sold in France were equipped with the software to cheat emissions tests.

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