Matthias Müller has been doing his best to polish Volkswagen’s latest results. The company's chairman said, ‘The Volkswagen Group’s operations are in great shape, as the figures before special items for the past fiscal year clearly show.’
If it weren’t for ‘the sizeable provisions we made for all repercussions of the emissions issue that are now quantifiable, we would be reporting on yet another successful year overall’. Ah yes, that pesky ‘emissions issue'.
As a result of that roadbump, VW announced it took a €16.2bn (£12.7bn) hit to pay for the diesel emissions test-rigging scandal and recorded a €1.3bn pre-tax loss - its first annual loss since 1993 and its biggest ever. It expects group sales to fall by up to 5% in 2016. If ‘special items’ are ignored the group had a €12.8bn operating profit. (So if you're willing to overlook the firm’s hefty corporate scandal where it admitted cheating on emissions tests for 11 million vehicles worldwide, and the ongoing costs it’s weathering, both financially and reputationally, all is rosy).
How VW proceeds from here is uncertain. After months of negotiations the group has just proposed the biggest car buy back in history (as many as 480,000 US cars equipped with the naughty, if devilishly clever, software).
And it’s a vast problem likely to rumble on for a while longer yet, amid a potentially turbulent time for the auto industry as a whole. This week's Mitsubishi news and announcement that several German carmakers plan to recall more than 600,000 cars as part of the investigations into emissions will have investors feeling edgy.
There’s still work to be done in rebuilding customer trust (as VW's sales compared to the rest of the European market reflect). The buy back proposal is a good, if expensive, start. It does though, inevitably mean questions will arise from non-US customers.
Britain's Transport Secretary Patrick McLoughlin has already stuck his oar in to enquire as to why those in the US are being offered compensation but not the UK. VW might have upped the amount set aside to deal with the fall out, but the overall cost of its scandal could continue to escalate for a while yet.