Volkswagen Sees €1.5 Billion Cost From EU Emissions Rules

Volkswagen AG estimated it will take a €1.5 billion ($1.6 billion) hit this year from stricter European Union standards for car emissions that the manufacturer will struggle to meet.

The anticipated costs include potential penalties for exceeding the EU’s tougher emissions target, Rolf Woller, VW’s head of investor relations, told analysts on a call Wednesday. The company also expects earnings to be eroded by having to sell more electric vehicles at the expense of more profitable combustion engine models.