Audi raided by German prosecutors in VW scandal fallout

Ingolstadt - Volkswagen’s Audi brand was raided by German prosecutors as investigations into the manipulation of diesel engines continue to weigh on the automaker more than a year after revelations of emissions cheating.

More than 100 police took part in searches on Wednesday at the company’s main sites in Ingolstadt and Neckarsulm as well as seven other locations across Germany.

The probe is focused on potential consumer fraud related to Audi’s role in developing tainted 3-litre diesel engines in the US, with officials seeking information on individuals involved, the Munich prosecutors office said in a statement. The company said it was cooperating fully with authorities.

The raids, which started at 12:00, came the same day that Audi was holding its annual press conference and mark a fresh blow to Volkswagen’s efforts to overcome the cheating crisis that erupted in September 2015.

Rather than grappling with renewed allegations, Audi had planned to shift attention to its recovery strategy after its role in manipulating about 80 000 diesel cars led to a €1.63bn charge last year from a settlement with US authorities.

“I myself have greatest interest in the clarification of the matter,” Audi chief executive officer Rupert Stadler said on Wednesday at the brand’s headquarters in Bavarian town of Ingolstadt, declining to comment on the reason and timing of the raids. “The diesel crisis has been the worst disruption in our history.”

Audi, the world’s third-largest luxury-car brand and Volkswagen’s biggest profit maker, is critical for Volkswagen, as the auto giant seeks to absorb the scandal’s damages, which so far total €22.6bn.

That burden comes on top of expenses for developing electric models and self-driving features. For its part, Audi set up a new subsidiary, dubbed Autonomous Intelligent Driving GmbH, to develop robot cars and plans three battery-powered cars by 2020.

The prosecutors’ probe adds to Audi’s woes as it has been losing ground to Daimler's Mercedes-Benz, which overtook BMW as the world’s bestselling premium-car maker last year. Audi’s global sales declined 1.1% in February to 125 100 cars as a dispute with dealers in its largest market China escalated. Audi’s deliveries in China fell 5.8% to 32 155 cars last month.

Read Fin24's top stories trending on Twitter: Fin24’s top stories