Volkswagen will seek damages from former executives accused in emissions fraud.

Volkswagen said on Friday that it would seek financial compensation from its former chief executive and the former head of the Audi division, accusing them of failing to act after learning that diesel vehicles sold in the United States were fitted with illegal emissions-cheating software.

The decision by the German carmaker’s supervisory board marks a turnabout. Volkswagen had been reluctant to publicly accuse former top managers of complicity in the emissions fraud, which has cost Volkswagen tens of billions of euros in fines, settlements and legal fees.

At the same time, the supervisory board said it found “no breaches of duty” by other executives who were members of Volkswagen’s management board in September 2015, when the scandal came to light.

That group includes Herbert Diess, now the chief executive of Volkswagen, who had joined the company two months earlier from BMW. Hans Dieter Pötsch, now chairman of the supervisory board, was chief financial officer and a member of the Volkswagen management board at the time, a position he had held for more than a decade.

Martin Winterkorn, the former chief executive, failed “to comprehensively and promptly clarify the circumstances behind the use of unlawful software functions” after learning about the misconduct in July 2015.

Mr. Winterkorn, who resigned shortly after the emissions fraud became public, also failed to ensure that questions by U.S. authorities “were answered truthfully, completely and without delay,” the supervisory board said. Shareholders suffered damages as a result, the board said, although it did not say how much money the company will try to recover.

Mr. Winterkorn’s lawyers said in a statement Friday that he denied the accusations and had done everything possible “to avoid or minimize damage” to Volkswagen.

The Volkswagen board said it also concluded that Rupert Stadler, former chief executive of the Audi luxury car division, was negligent because he failed to investigate the use of illegal software in diesel vehicles sold in the European Union.

Mr. Winterkorn and Mr. Stadler face criminal charges in Germany that revolve around the same circumstances. Mr. Winterkorn’s trial was scheduled to begin in April, but judges in the case postponed it this week until September, citing the pandemic.

Mr. Stadler has been on trial in Munich since last year on charges that, even after the wrongdoing came to light, he allowed Audi to continue selling cars that were programmed to recognize when an official emissions test was underway and dial up emissions controls to make the car appear compliant. The cars were not capable of consistently meeting pollution standards.

Mr. Stadler’s lawyer did not immediately respond to a request for comment. In the past, Mr. Stadler has denied wrongdoing.

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How Volkswagen’s Sins Fueled Its Redemption

Christian Strenger, a vocal Volkswagen critic and a former member of the commission that wrote Germany’s corporate governance code, sees little chance the company’s overseers will expose themselves to more scrutiny. The supervisory board has only one member out of 20 who is not a representative of the three main shareholders or Volkswagen employees.

“Nothing will change as long as the old guard is there,” Mr. Strenger said.

The diesel scandal remains a financial burden. The company disclosed in its annual report this week that potential liabilities from lawsuits, such as one by shareholders claiming the company misled them, could cost 4.2 billion euros, or $5 billion. That is in addition to the tens of billions of euros Volkswagen has already paid in fines and settlements since 2017 after admitting that it programmed diesel cars to produce lower emissions in testing conditions than in normal use.

Investors this week were focusing on Volkswagen’s future rather than its past.

In a series of appearances starting Monday, Mr. Diess and other executives outlined a 35 billion plan to build six battery factories, install a global network of charging stations and employ 10,000 software engineers to work on autonomous driving and other new technologies. Volkswagen would become the biggest software company in Europe after SAP, the German maker of software used by corporations to manage functions like logistics and finance.

Volkswagen’s voting shares ended the week up 20 percent in Frankfurt trading and have risen 75 percent since December, despite the company’s reporting a 37 percent drop in net profit for 2020 after the pandemic gutted sales. Since 2015, the shares have more than tripled.

Volkswagen also benefited from a report issued this month by analysts at UBS, the Swiss bank, which rated it as the traditional carmaker best positioned to compete with Tesla because it already has the ability to mass-produce electric cars economically.

Volkswagen’s advantage goes back to the decision made at that meeting in 2015, weeks after the emissions scandal became public.

The executives authorized development of a collection of mix-and-match components that would serve as the basis for a range of electric models including sedans, S.U.V.s and vans. The standardized platform, called the Modular Electrification Toolbox, could also be used by other company brands, including Audi.

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Volkswagen Aims to Use Its Size to Head Off Tesla

Volkswagen is going all in on electric cars, with plans to build battery factories in Europe, install a network of charging stations and slash the cost of emission-free travel.

That was the message Monday as the German carmaker staged a so-called Power Day to showcase its latest electric car technology. The event was Volkswagen’s answer to Tesla’s Battery Day presentations, which draw intense attention from investors and electric car buffs.

The session included a number of attention-getting announcements, including a promise that Volkswagen would cut the cost of batteries by up to 50 percent by the end of the decade, while slashing charging time to 12 minutes. That would make electric cars cheaper than gasoline vehicles and just as convenient.

Volkswagen also unveiled plans to build six battery factories in Europe in joint ventures with suppliers. And by 2025, the company said, it would have 18,000 charging stations on the continent operating in conjunction with energy companies including BP. The British oil producer said it would offer charging at its filling stations.

General Motors or Volvo Cars in setting a precise expiration date for internal combustion engines.

Volkswagen is the biggest carmaker in Europe and second biggest in the world after Toyota. The subtext of Monday’s presentations by a parade of Volkswagen executives was that the company is deploying its industry and government connections, its financial resources, and its eight decades of manufacturing expertise to keep Tesla from eating its lunch.

“Our transformation will be bigger than anything the industry has seen in the past century,” Herbert Diess, the chief executive of Volkswagen, said during the two-hour presentation.

The event coincided with the rollout in the United States of the ID.4, an electric S.U.V. that is part of the first generation of Volkswagens designed from the ground up to run on batteries and seen as serious challengers to Tesla’s dominance in electric cars. The first ID.4s, with a starting price of $40,000 before government rebates, began arriving at American dealers this week.

At least some analysts are starting to believe Volkswagen’s hype. The Swiss bank UBS issued a report this month that ranked Volkswagen just behind Tesla in electric vehicle technology.

Tesla shares have plunged in recent weeks as it dawns on some investors that the California company may not have a monopoly on electric cars. Volkswagen shares have recovered their prepandemic value and then some. But investors still value Tesla at six times as much as Volkswagen, and the German company faces enormous challenges.

hiring freeze and offer early retirement to employees as young as 56 to free up money for new technologies. The company said it would continue to hire people with expertise in batteries, electricity and software.

Volkswagen’s new electric models, while promising, have yet to prove themselves in the market. They were initially plagued by software problems, although the company says those have been solved. After a delayed launch, Volkswagen sold 56,000 of its ID.3 model, an electric hatchback not offered in the United States, in the last few months of 2020.

Volkswagen is coping with the devastating effect that the pandemic had on sales. Deliveries to customers fell 15 percent in 2020, to 9.3 million vehicles.

diesel emissions scandal continues to keep hundreds of lawyers busy and gnaw at Volkswagen’s reputation. Martin Winterkorn, who was chief executive during the years that Volkswagen rigged diesel vehicles to cheat emissions limits, is scheduled to go on trial next month on charges related to the scandal. The trial is certain to generate heavy media coverage and remind the public of Volkswagen’s misdeeds, which came to light in 2015. Mr. Winterkorn denies wrongdoing.

As costly as it has been, the scandal had one benefit for Volkswagen. It forced the company’s managers to think hard about how to restore the company’s good name. They resolved to focus on electric cars. That may put Volkswagen in a better position today than other big rivals that hesitated.

UBS analysts pointed out that Volkswagen is one of the few big carmakers to have developed a platform specifically for electric vehicles, and to retool entire factories to build electric cars. Volkswagen’s size — it sold 18 times as many cars as Tesla last year — will allow it to push down manufacturing costs in a way that smaller carmakers cannot.

Like Tesla, Volkswagen has recognized that people won’t buy electric cars unless there is someplace to charge them. In addition to underwriting a charging network in Europe, Volkswagen will install 3,500 fast-charging points in the United States and 17,000 in China.

Many other traditional carmakers approached the electrification of cars as something they were forced to do to meet emissions requirements, Mr. Hummel of UBS said.

“They spent too much time looking at electric vehicles from the perspective of compliance,” he said. “Now they are catching up but they are late.”

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Picture brightens for commercial EVs on rising demand from delivery customers

BANBURY, England (Reuters) – Electric van and bus maker Arrival is wrestling with the global pandemic like other UK firms, but not because of a lack of business.

A man stands next to a fully-electric test van, due to go into production in 2022, built by electric van and bus maker Arrival Ltd, that has seen a spike in interest due to soaring e-commerce amid the coronavirus disease (COVID-19) pandemic and looming fossil-fuel vehicle bans, in Banbury, Britain, February 23, 2021. Picture taken February 23, 2021. REUTERS/Nick Carey

Arrival is fielding four to five times the number of queries from potential customers compared with a year ago as soaring e-commerce during the pandemic and changing emissions regulations have fueled demand, said president Avinash Rugoobur.

“Worldwide, the mindset has shifted and people understand the future is electric,” said Rugoobur. “So now it’s a question of how do we get there?”

At Arrival’s R&D centre in Banbury, northwest of London, executives from a major British retail group patiently waited to tour the startup’s test van, due to start production in 2022.

A spike in interest in Arrival followed Britain’s call in November for a ban on new fossil-fuel vehicles by 2030, and was further helped by new U.S. President Joe Biden’s stated interest in electrification.

Tightening CO2 emissions targets in Europe and China have combined with improving battery technology to provide greater range at lower costs, giving commercial electric vehicles (EVs) their moment in the sun after years of waiting.

“People talk about a tipping point for commercial EVs, but I think we’re already there,” said Luke Wake, vice president of maintenance and engineering at United Parcel Service Inc, which has ordered up to 10,000 vans from Arrival and owns a stake in the startup.

Feverish investor interest in finding the next Tesla Inc and bringing them to market via special-purpose acquisition companies (SPACs) has included commercial EV startups like Canoo Inc and Arrival, which will go public later this month via a merger with CIIG Merger Corp.

Also, the coronavirus pandemic has boosted the need for vans to deliver goods to consumers at home.

Startups like Rivian, Volta Trucks and traditional manufacturers Daimler AG, Ford Motor Co and General Motors Co have models out or in the works. Rivian will begin making vans for Amazon.com Inc later this year.

As batteries are still expensive, commercial EVs have a higher sticker price than diesel or petrol equivalents – a hard sell for many cost-conscious companies.

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But thanks to lightweight materials and tailoring battery packs to customers’ range needs, Arrival’s Rugoobur said that is about to change – at some ranges its vans will cost less than a diesel equivalent.

“If Arrival can manufacture those vehicles at the equivalent price of a diesel van, the total cost of ownership is so heavily in their favour it becomes a competitive advantage,” said David Wyatt, an analyst at research firm IDTechEx.

‘IT’S GOING TO HAPPEN FAST’

Fleet operators also face increasing scrutiny over sustainability from retail customers, who feel the same pressure from consumers, said Volta Trucks Chief Executive Rob Fowler.

“If you look at logistics operators, they’re in the middle and under pressure from all sides,” he said.

Stockholm-based Volta Trucks, which also operates in the UK, is developing a 16-tonne electric truck, due for production in 2022, for urban freight distribution routes. Batteries are heavy, so the Volta Zero’s body is made of a light hemp-based composite and its shorter inner-city routes require fewer battery cells.

Volta Trucks has an order book of $260 million and its biggest public order to date is for 1,000 trucks from French refrigerated truck firm Petit Forestier.

Higher upfront costs, challenges associated with charging multiple vehicles simultaneously and a paucity of available models mean there are still relatively few commercial EVs in service.

But Simon Webber, a portfolio manager at Schroders, which has about $650 billion in assets under management, said more EVs coming to market and falling battery costs will change that.

“It’s going to happen fast,” Webber said. “Because the average life of those vehicles is lower, they turn over faster than passenger vehicles, they will electrify faster.”

Leading energy consultancy Wood Mackenzie said the commercial EV market will mushroom from a low base today to global sales of 3 million units by 2025 and 9 million by 2030, led by buses and light trucks.

Based on conversations with manufacturers, “we see commercial electric vehicles coming in a big, big way,” said Tom Jensen, CEO of battery maker FREYR, which is going public via a merger with a SPAC, Alussa Energy Acquisition Corp.

‘STILL MORE EXPENSIVE’

EV makers say while commercial EVs have a higher sticker price, over their lifetime their “total cost of ownership” is lower as electricity is cheaper than diesel and electric motors require less frequent repairs due to having fewer moving parts.

The UK arm of package delivery firm DPD, a unit of France’s La Poste, was an early adopter and its 732 EVs account for nearly 10% of its fleet – most of them e-NV200 vans from Nissan Motor Co Ltd or eTGE vans from Volkswagen AG unit MAN.

In 2020, the pandemic drove DPD’s volumes to a daily record of 2 million packages during the holiday peak season and the company will buy 500 more electric trucks in 2021.

Olly Craughan, DPD UK’s head of corporate social responsibility, said a diesel Mercedes-Benz Sprinter unit costs around 25,000 pounds ($34,572), but an electric version costs up to 45,000 pounds.

“It’s still more expensive, but the gap is closing,” said Craughan. “If you can run them longer than diesel vehicles that’s where you’re going to make more of a return.”

DPD will test a Volta Zero later this year and has talked regularly with Arrival, Craughan said.

By 2025, battery prices are expected to fall enough to give EVs price-parity with fossil-fuel vehicles.

But Arrival’s Rugoobur said some of the startup’s production models will already beat diesels on price – aided by a tough, light thermoplastic composite body that offsets heavy batteries – and includes basic self-driving features to cut down on costly accidents at package depots.

“If we can get that price point down to an acceptable level where you can scale it, it allows us to make bigger commitments like the one with Arrival,” UPS’s Wake said.

Reporting by Nick Carey in Banbury, England; Additional reporting by Kate Abnett in London; Editing by Ben Klayman and Matthew Lewis

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U.S. judge approves Daimler’s $1.5 billion diesel emissions settlement

WASHINGTON (Reuters) – A federal judge on Tuesday approved Daimler AG’s $1.5 billion settlement to resolve a U.S. government probe into the German automaker’s use of undisclosed software that allowed excess diesel pollution to be emitted by 250,000 of its vehicles in the United States.

FILE PHOTO: A new Daimler AG, FUSO battery-powered eCanter urban delivery truck is unveiled during a news conference in New York City, U.S. September 14, 2017. REUTERS/Brendan McDermid

The settlement with the U.S. Justice Department and California Air Resources Board, which was announced in September, includes an $875 million civil penalty levied under the Clean Air Act, $70 million in additional penalties and $546 million to fix the polluting vehicles and offset excess emissions, court papers show.

U.S. District Judge Emmet G. Sullivan called the California settlement fair, reasonable and in the public interest, and noted settlement talks lasted for more than three years.

As part of the settlement, Daimler will pay California $285.6 million.

The German company has separately agreed to a $700 million settlement with diesel vehicle owners. That settlement has won preliminary approval and is likely to get final approval this summer, said Steve Berman, a lawyer for the owners.

In December, the Justice Department said the settlement ensured Daimler would “repair around 250,000 vehicles at no cost to consumers” and fully address excess air pollution.”

Diesel vehicles have come under scrutiny in the United States since Volkswagen AG admitted in 2015 to installing secret software on 580,000 U.S. vehicles that allowed them to emit excess emissions.

In 2019, Daimler agreed to pay a 870 million-euro ($1.03 billion) fine in Germany for violating diesel emissions regulations.

Both Volkswagen and Daimler halted sales of U.S. passenger diesel vehicles.

Fiat Chrysler, which is now part of Stellantis NV, reached an $800 million settlement in 2019 to resolve claims by regulators and owners that it used illegal software that produced false results on diesel-emissions tests.

Stellantis said last week in a securities filing that it remains in talks to resolve an ongoing U.S. Justice Department criminal probe, and previously set aside 200 million euros ($238 million) to address the issue.

Reporting by David Shepardson and Jonathan Stempel; Editing by Chizu Nomiyama and Paul Simao

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Bruce Meyers, Who Built the First Fiberglass Dune Buggy, Dies at 94

Bruce Meyers, who used his skills as a boat builder to invent the first fiberglass dune buggy, igniting the late-1960s craze for off-road riding, and thrived until copycats flooded the market, died on Feb. 19 at his home in Valley Center, Calif. He was 94.

The cause was myelodysplastic syndrome, a blood cancer, said his wife, Winnifred (Baxter) Meyers.

Mr. Meyers’s invention got a big promotional boost after he and a friend drove the Meyers Manx (named for the cat with a stub of a tail) to a time record over nearly 1,000 miles of the rough roads of the Baja California Peninsula in 1967. The victory proved the vehicle’s viability and made an aging beach boy the darling of off-road devotees.

“Go back to the lifestyle I lived when I came into this thing,” he said in a 2017 interview with Motorward, an automotive website. “It wasn’t about higher learning or education, but just about having fun.”

Mr. Meyers was a surfer in Southern California with a fine-arts education who in the late 1950s and early ’60s watched four-wheel-drive Jeeps struggle for traction on sand dunes.

he told The National, an newspaper in Abu Dhabi, in 2012. “Maybe my instincts when I was creating the dune buggy were guided by my memories.”

For 18 months, he worked in his small garage in Newport Beach to create the Meyers Manx. He removed a Beetle’s body, shortened its floor section, then bolted on a one-piece fiberglass shell (with fenders, sides and a front hood area) that was moldable and lightweight but sturdy.

He completed the Beetle-turned-Manx in 1964, making it light and quick, with a shorter turning radius and greater traction than the dune buggies that preceded his. He named his creation Old Red for its paint job.

A cover article in Road & Track, which chronicled the wild Baja adventure, jump-started orders for the kits. But demand eventually overwhelmed the ability of Mr. Meyers’s company to produce the kits —- he insisted that he was not a businessman — and rivals made knockoffs of his design.

Mr. Meyers turned out more than 5,000 kits, but it was estimated that at least 20 times as many faux Meyers Manxes were produced. He lost a legal fight against a copycat manufacturer to uphold his patent on a “sand vehicle.” In 1971, he shut down B.F. Meyers & Company.

“It took 10 years before I could hear the words ‘dune buggy’ and not get furious,” he told Car and Driver in 2006.

And almost three decades before he returned to the business.

Bruce Franklin Meyers was born in Los Angeles on March 12, 1926. His father, John, helped set up car dealerships for Henry Ford. His mother, Peggy, was a song plugger.

Mr. Meyers dropped out of high school to join the merchant marine and volunteered for the Navy during World War II. He was serving aboard the aircraft carrier Bunker Hill when it was attacked by two Japanese kamikaze aircraft on May 11, 1945, near Okinawa. He recalled jumping into the water as the burning carrier started to sink; he gave a sailor his life jacket and helped a badly burned pilot until they were rescued by a destroyer hours later.

In the carnage, 346 sailors and airmen died, 264 were wounded and 43 were missing.

“I spent almost a month coming back with a skeleton crew, pulling the dead men out of the ship,” Mr. Meyers told The National.

Manx 2+2 and the Manx SR.

The couple sold the company in November to Trousdale Ventures, an investment firm.

“He was 94,” Winnie Meyers said by phone, “and I had to stop.”

1964 Shelby Cobra Daytona Coupe CSX2287) inducted into the National Historic Vehicle Register, an eight-year-old project detailing the historic and cultural significance of American vehicles. The register is a collaboration between the Historic Vehicle Association, an owner group, and the Department of the Interior.

In a nod to Mr. Meyers’s ingenuity and his business woes, the register said the Meyers Manx was “the inspiration for over 250,000 similar cars manufactured by other companies, and is thus the most replicated car in history.”

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