Quote Originally Posted by MikeD View Post
Finally somebody other than me, who's not that impressed with german cars. I have always been into Italian and French car brands, and especially the rare sport cars.

On the matter of there will be effects on the VW motorsport programs .... trust me there will. If you follow CNBC or Bloomberg, you will get the sense of how serious this actually is ... not only for the many law suits awaiting them, but also for future earnings for the company. There is a reason that Angela Merkel is involved in this now, and that's because German carmakers, is 20% of the total German exports!!

I do think, due the the company called VW, that it's actually that brand that will be most under threat, and I do expects the VW program in the WRC to be stopped by the end of this year at the latest. The last thing they want with the VW brand is to participate in what is percieved as a poluting by the normal people. Furthermore, the VW group will actually have to look at the political interest in the company, and their stockholders more than anything. So I guess cost-cutting will be on the agenda, after the law-suits have been settles, and there is no way that the WRC program will fit into that.
Every country that has a competing car production will want to exploit this opportunity of trying to take down VW. South Korea, France, Italy, USA etc.
The same (wrongfully) happened the last time Audi tried to get in to the US market (the withdrew, but the damage was contained in the US.)

Regarding the WRC program I would not think that this will be affected. This will be a big blow for VW, and they will have to pay out many billions of dollars, but they are a HUGE company, with a HUGE revenue, so the cash payments won't be what hurts the most.

But stock prices now down 35% is worse. Stock prices is off course only fantasy money, but VW now needs to work very hard to earn the stock buyers thrust. And will do that as soon as things have been settled, and payments done etc, and the first quarter they start a positive progression in the market after that. If money comes in and everybody is happy, the market will have thrust.

The WRC program is such a small part of the VW, but still an important brand builder, so its very unlikely of this moment (if not something else happens) that the plug will be pulled. But had they've been in Hyundais position, this could be the "perfect" escape, like both Suzuki and Subaru used the financial crisis as a "force majour" excuse to pull the plug on their WRC efforts, even tough it really was other aspects that was more important than that. Like not being competitive - for whatever reason.

If I have one tip in all this VW crisis hysteria, is to wait until You think the stocks have hit rock bottom (not long), and buy VW stocks. You can potentially earn a lot of money.