Auto manufacturers are regularly shifting focus and trying to stay on the cutting edge in an effort to maximize revenues in the multi-billion dollar auto industry. As consumer demands change, auto manufacturers must adapt.
Recently, Volkswagen experienced turmoil as a result of failed emissions tests and alleged knowledge of the shortcomings by the manufacturer. The company faced backlash from government agencies and consumers alike. The manufacturer has come to a series of agreements which will end up costing them approximately $15 billion to settle claims from the scandal, including $10 billion to buy back the vehicles from the owners of affected diesel cars, $2.7 billion to the EPA, and $2 billion for the Clean Energy Technology mandates.
In an effort to re-gain consumer confidence and boost sales, VW has decided to scale back its diesel engine push that it had been actively promoting. The manufacturer has made a decision to change strategy and pursue other opportunities. Automotive News profiles the change and what lies ahead for the manufacturer.
TBC has a dedicated team of CPAs specializing in the automotive industry that meet monthly to discuss industry issues and changes that will affect our clients.