Renault Shares Drop on Apparent Fraud Probe Into Emissionsby and
Decline is biggest since 1999 after union says offices visited
Company, government fraud office haven't returned calls
Renault SA shares plunged the most in 17 years after a union said French fraud investigators seized computers from the automaker, apparently as part of a probe into emissions testing.
Agents from the Economy Ministry’s fraud office visited some Renault sites that have to do with standards testing and engine certification, Florent Grimaldi, an official with the CGT union in Lardy, France, said by telephone Thursday, confirming a report earlier by Agence France-Presse. That left the impression that the probe is related to emissions standards in the wake of the Volkswagen AG scandal, he said.
Renault dropped 21 percent to 68.70 euros at 12:30 p.m. in Paris. The intraday decline of 23 percent was the biggest since Jan. 4, 1999, wiping out 5.8 billion euros ($6.3 billion) in market value. Peugeot fell 7.2 percent to 13.70 euros.
Renault said it planned to issue a statement soon. The fraud office didn’t return a call seeking comment. Investigators visited four different sites near Paris, including Lardy and company headquarters in Boulogne-Billancourt, on Jan. 7, according to AFP.
Automakers have been under renewed scrutiny since September, when U.S. regulators said VW cheated to make its diesel cars appear cleaner burning than they are. 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. Separately, the country’s environmental regulator began randomly testing vehicles to check differences between
emissions results found in laboratory testing and real-world figures.
Peugeot said in October it never used software to turn on emissions controls only while being tested, as Volkswagen admitted to doing.