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Volkswagen | Shares in Free Fall After Admitting Foul Play with US Pollution Test


German car maker Volkswagen AG has admitted that it cheated the US air pollution tests for many years now and is facing billions of dollars in potential fines while criminal prosecution is also on the table.

Shares dropped more than 17% this morning in the Frankfurt Stock Exchange, the highest drop in a trading session for almost seven years. This brings the company to a loss of 25% this year and a valuation at 65.3 billion euros ($73.9 billion).

The CEO of the company Martin Winterkorn said that he was deeply sorry for the “broken trust” these news have brought both to consumers and governments around the world, that Volkswagen aspires to target its sales. VW has immediately stopped the sales of the car models involved, affecting negatively all of Winterkorn’s efforts to catch up in the U.S. The test violations have stalled the sales of half a million vehicles and could easily result in $18 billion in fines. Criminal prosecution is also possible.

“If this ends up having been structural fraud, the top management in Wolfsburg may have to bear the consequences,”said Sascha Gommel, a Frankfurt-based analyst for Commerzbank AG, whose share rating is under review.