In the wake of the Dieselgate scandal, Volkswagen decided to suspend its plans of cutting jobs in the meantime. Instead, the top executives of the German automaker are considering surrendering part of their 2015 bonuses.
“The bonus issue is on the agenda for the board meeting,” said an insider.
Market Watch reveals that the executive board of Volkswagen AG is set to meet on Apr. 12, 2016 to talk about voluntarily giving up part of the bonuses that the management is supposed to receive in 2015. The execs are encouraged to show how much they support the workforce, investors and clients in terms of the massive expenses that resulted from the Dieselgate scandal.
On April 11, core shareholders and stakeholders also had a meeting which included representatives from the works council of Volkswagen, the IG Metall trade Union and Lower Saxony, which holds 20% of the voting capital of the company, urging Chief Executive Matthias Muller to give up the bonuses.
Labor leaders and shareholders are asking the company executives to let go of a portion of their bonuses to avoid job cuts and huge shareholder losses. Volkswagen may lose billions of euros in penalties and compensation. After the emissions-cheating scandal erupted, the company has been the subject of criminal and regulatory investigations in the United States and Europe. According to car analysts, Volkswagen may pay up to $38 billion for vehicle adjustments, lawsuits and fines.
Albany Daily Star states that Volkswagen may also offer cash to the U.S. owners of the affected diesel cars with the objective of gaining back the good will that it lost. The company confessed in September 2015 that the vehicles were set to cheat during emissions tests, allowing hundreds of thousands of their vehicles to be cleared despite emitting higher nitrogen oxide levels than allowed by law. The cars that were equipped with illegally programmed software include diesel Beetle, Golf, Jetta and Passat models dating back to 2009 models. Audi A3 cars were also included.
The exact amount to be given is still unconfirmed. There are talks that owners may receive about $1,250. It is still uncertain whether those who accept the cash should waive their rights to sue.
At present, Volkswagen is trying to revive the huge sales drop in the past months by providing cash incentives to current owners if they purchase or lease a new car. All buyers are also being offered huge discounts.
More updates and details on the Volkswagen Dieselgate scandal are expected soon.
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