Latest / Bloomberg Intelligence / Bloomberg's Ambrosio on VW Settling Cheating Claims (Audio)

Transcript

Bloomberg's Ambrosio on VW Settling Cheating Claims (Audio) · Bloomberg Intelligence

• 0:03
  Speaker 1: Global business news twenty four hours a day at Bloomberg
• 0:06
  Speaker 1: dot Com, the Radio plus Mobile Act and on your radio.
• 0:10
  Speaker 1: This is a Bloomberg Business Flash from Bloomberg World Headquarters.
• 0:14
  Speaker 1: I'm Katherine Cowdery. We check the markets every fifteen minutes
• 0:16
  Speaker 1: throughout the trading day. Let's go over to the First
• 0:19
  Speaker 1: Word Breaking news desk for today's afternoon call with Bill Maloney. Bill,
• 0:23
  Speaker 1: Good afternoon, Katherine Sharp gains for u S stocks after
• 0:27
  Speaker 1: two days of Briggsit related losses. Daw is currently hired
• 0:30
  Speaker 1: by two d and thirty one point says It's game
• 0:32
  Speaker 1: thirty two and Nazac rises ninety four. The sp file
• 0:36
  Speaker 1: hundred regained the two hundred day moving average and rises
• 0:39
  Speaker 1: the most since March eleventh. Over in Europe, Italy climbed
• 0:42
  Speaker 1: three point three percent and the UK rose two point
• 0:45
  Speaker 1: two point six percent. Back in the usas small cap
• 0:48
  Speaker 1: six hundred games ten points and the US ten yield
• 0:51
  Speaker 1: at one point for six percent, All tennis to be
• 0:54
  Speaker 1: sectors are higher, led by games and energy, Financials and technology.
• 0:58
  Speaker 1: Dow Transports jump two per set, Nasibotex rise three point
• 1:02
  Speaker 1: seven per cent, the vix is down twenty percent, down
• 1:06
  Speaker 1: leaders included Travelers, Jape and Morgan, and Visa, while DuPont
• 1:09
  Speaker 1: fell two point seven percent. Shares Word downgraded to neutral
• 1:13
  Speaker 1: over at JP Morgan after the bell Tonight look for
• 1:16
  Speaker 1: earnings from Nike. Estimates are four forty eight cents on
• 1:18
  Speaker 1: revenues of eight point to eight billion. Live from the
• 1:21
  Speaker 1: First and Breagan News desk on Bill Maloney, Katherine, thank you,
• 1:24
  Speaker 1: billan to hear live breaking news over your Bloomberg type
• 1:27
  Speaker 1: squ a k on your terminal. West Texas Intermediate crude
• 1:30
  Speaker 1: oil is up a dollar forty eight of barrel three
• 1:32
  Speaker 1: point two percent to forty one. Spockle down nine dollars
• 1:36
  Speaker 1: fifty cents announced at thirteen fifteen twenty and the ten
• 1:38
  Speaker 1: year treasury down five thirty seconds with the yield of
• 1:41
  Speaker 1: one point four five percent. And that's a Bloomberg business
• 1:43
  Speaker 1: flash you're listening to taking stock with Pim Fox and
• 1:47
  Speaker 1: Kathleen Hayes on Bloomberg Radio. Fourteen point seven billion dollars.
• 1:55
  Speaker 1: That's what v W has agreed to pay to settle
• 1:58
  Speaker 1: its claims from the emissions cheating scandal. It's one of
• 2:03
  Speaker 1: the nation's largest consumer class action settlements on record, and
• 2:07
  Speaker 1: in fact it is the largest ever paid by an
• 2:10
  Speaker 1: auto company. Joining US now is Patrick Ambrosio. He's environmental
• 2:15
  Speaker 1: reporter for Bloomberg b n A. He joins US now
• 2:19
  Speaker 1: from b NA headquarters in Alexandria, Virginia, the Washington d C.
• 2:25
  Speaker 1: Metro area. He was over across the river looking at
• 2:31
  Speaker 1: and listening to some very important testimony today. Patrick, thank
• 2:34
  Speaker 1: you for joining us. Yeah, thanks for having me. So
• 2:38
  Speaker 1: you were at the Department of Justice as press conference.
• 2:41
  Speaker 1: You're sitting on a call with plaintiffs attorneys. First of all,
• 2:45
  Speaker 1: tell us a little bit more about the settlement. I
• 2:48
  Speaker 1: understand that a big chunk of this money is going
• 2:50
  Speaker 1: to be used to buy back cars with the with
• 2:56
  Speaker 1: the diesel engines. Uh, buying back from the customers. I
• 3:00
  Speaker 1: guess I'd be pretty lucky in a sense if I
• 3:01
  Speaker 1: owned one. Yeah, that is a significant portion of that
• 3:06
  Speaker 1: big fourteen point seven billion number. Today, About ten billion
• 3:10
  Speaker 1: of that is going to go to consumers. Uh. The
• 3:14
  Speaker 1: consumers will have options. There's going to be a buy
• 3:16
  Speaker 1: back option that should start later this year. Uh. It's
• 3:20
  Speaker 1: how much you're gonna get it brought back for. It
• 3:21
  Speaker 1: is going to depend on the model. Uh. It could
• 3:23
  Speaker 1: range anywhere from twelve thousand, five hundred for some of
• 3:26
  Speaker 1: the older vehicles to as much as forty four thousand
• 3:30
  Speaker 1: for for some of the more recent vehicles. UH. It's
• 3:33
  Speaker 1: there's also the still the potential for a fix. UH,
• 3:36
  Speaker 1: Folkswagan has been looking for a way to bring these
• 3:39
  Speaker 1: vehicles into compliance with the emission standards. They haven't gotten
• 3:42
  Speaker 1: it approved, but if they do get one approved, UH,
• 3:46
  Speaker 1: sometime in the near future, consumers will be able to
• 3:48
  Speaker 1: get it to proved for get it fixed for free,
• 3:51
  Speaker 1: and get a payment on top of that to cover
• 3:53
  Speaker 1: any any sort of issue that they may have. So
• 3:55
  Speaker 1: what kind of things did you hear to at a
• 3:57
  Speaker 1: press conference today and on this call a plane if attorneys?
• 4:01
  Speaker 1: What what is being said? What's the mood? What's the
• 4:04
  Speaker 1: sense of where this goes next? Uh? Well, the mood
• 4:08
  Speaker 1: uh for the class action of planets for the people
• 4:12
  Speaker 1: that bought the cars that they were saying, you know,
• 4:13
  Speaker 1: this is this is what we wanted. We wanted substantial
• 4:16
  Speaker 1: compensation for the people who bought these cars and didn't
• 4:19
  Speaker 1: get what they paid for the buyback option. That was
• 4:23
  Speaker 1: something that was really pushed for because there were a
• 4:25
  Speaker 1: lot of people who are not happy Uh, there were
• 4:27
  Speaker 1: a lot of environmentally conscious consumers who bought these cars
• 4:30
  Speaker 1: because they were marketed as being you know, clean diesel,
• 4:34
  Speaker 1: they're better for the environment. People bought them and then
• 4:36
  Speaker 1: only to find out they were allied to and they're
• 4:38
  Speaker 1: actually significantly worse than they thought. On the government side, Uh,
• 4:44
  Speaker 1: it was you know, it's it's obviously a historic settlement,
• 4:48
  Speaker 1: but you know it's been described by Justice farming officials.
• 4:51
  Speaker 1: This is only the first step. This only solved some
• 4:54
  Speaker 1: of the problems. There's still a lot more on the table,
• 4:56
  Speaker 1: including possible criminal charges as well as of all, penalties
• 5:01
  Speaker 1: aren't addressed on this soil. Volkswagen could end up paying
• 5:03
  Speaker 1: a lot more than that fifteen billion. Give us a
• 5:05
  Speaker 1: sense of how that might add up and who will
• 5:07
  Speaker 1: they pay it to. I understand a significant civil penalties
• 5:11
  Speaker 1: from the federal government. This is something you have been
• 5:13
  Speaker 1: analyzing in your Bloomberg Intelligence research. But could it be
• 5:19
  Speaker 1: another fifteen billion? Would it be five hundred million? Where
• 5:21
  Speaker 1: does this how does this potentially stack up? Yeah, you know,
• 5:24
  Speaker 1: it's that's something they were very moment today. They said,
• 5:27
  Speaker 1: we're still in the discovery phase. Uh. They got more
• 5:30
  Speaker 1: than one point five million documents from Volkswagen that they're analyzing. UH,
• 5:34
  Speaker 1: and and this settlement really doesn't affect any of those
• 5:37
  Speaker 1: allegations that the civil penalties would be for violating the
• 5:41
  Speaker 1: Clean Air Act, the environmental law that they violated when
• 5:43
  Speaker 1: they sold these cars. UH. It's significant penalties are on
• 5:47
  Speaker 1: the table. UH, it's whether it's likely to be settled,
• 5:51
  Speaker 1: but we don't know what that number is going to
• 5:52
  Speaker 1: look like and how the the money that they've already
• 5:55
  Speaker 1: agreed to pay, how that's going to affect what the
• 5:58
  Speaker 1: what the eventual number that the Justice Department is going
• 6:01
  Speaker 1: to settle on to to really punish them for what
• 6:03
  Speaker 1: they did. Criminal investigation, what would rise to the level
• 6:08
  Speaker 1: of criminal conduct? Would involve more fines? Would it involve
• 6:12
  Speaker 1: jail time? It depends. There's there's could be both criminal
• 6:17
  Speaker 1: penalties sought against the company itself as well as individuals. UH.
• 6:22
  Speaker 1: Deputy Attorney General Yates said today that they are investigating companies,
• 6:27
  Speaker 1: they're investigating individuals who worked at Volkswagen. UH. There there's
• 6:32
  Speaker 1: monetary penalties. There also is the possibility of jail time, UM,
• 6:36
  Speaker 1: though it's not clear how that would work out. It
• 6:37
  Speaker 1: if the people were you know, German citizens working in Germany.
• 6:41
  Speaker 1: What kind of jurisdiction there would be there, That's still
• 6:44
  Speaker 1: a question that remains to be seen. Yeah, a lot
• 6:45
  Speaker 1: of big questions if it goes that far. What's next?
• 6:48
  Speaker 1: What are you watching next? And what should we be
• 6:49
  Speaker 1: watching nick met next? As Uh, this first settlement has
• 6:53
  Speaker 1: agreed and other charges are pursued. Well, right now, it's
• 6:57
  Speaker 1: a proposed settlement. It undergoes a comment area than the
• 7:00
  Speaker 1: judge needs to approve it, so that should be wrapped
• 7:03
  Speaker 1: up sometime in the fall. Uh. And then consumers will
• 7:06
  Speaker 1: actually need to take action and sell back their car
• 7:09
  Speaker 1: if they want to. Uh. As far as what's next,
• 7:12
  Speaker 1: keep looking out for possible criminal charges. Uh. There's also
• 7:15
  Speaker 1: individual states are still pursuing actions. Uh. And and what's
• 7:19
  Speaker 1: going to happen in Europe? They they they still haven't
• 7:22
  Speaker 1: figured out what they're doing for the car owners in Europe.
• 7:25
  Speaker 1: So so really we don't know what the finals have
• 7:27
  Speaker 1: on this is gonna be, but it's it's gonna be high.
• 7:30
  Speaker 1: I'll starting a fifteen billion, my friend. Uh, that's uh,
• 7:33
  Speaker 1: that's not chump changes people used to say. Patrick Ambrosio
• 7:36
  Speaker 1: is environmental reporter for Bloomberg b NA based in the
• 7:39
  Speaker 1: Washington d C. Metro area Arlington, Virginia. This is Bloomberg Radio.
• 7:45
  Speaker 1: Bloomer Taking Stock is brought to you by Cone RESNUC Accounting,
• 7:48
  Speaker 1: Tax Advisory. Is your business ready to break through? See
• 7:51
  Speaker 1: how professionals at Cone Resnick can help guide your business forward.
• 7:54
  Speaker 1: Find out more at Cone Resnick dot com.