VW chairman: Main challenge is to win back trust

Embattled German automaker Volkswagen said Thursday it was making "good progress" with its emissions investigations and is working hard to win back the trust of customers and shareholders.

Supervisory board members gathered in Wolfsburg, Germany, to review the findings of an internal probe. VW said that it had widened its investigations to deal with the diesel emissions scandal as well as claims that it had also understated CO2 levels in its products.

Approximately 450 external and internal experts are involved in the investigations and 100 terabytes of data has already been secured. Hans Dieter Pötsch, the chairman of the supervisory board of Volkswagen said "nothing will be swept under the carpet" and was optimistic on the results.

'Valuable findings'

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"We have lost trust of our customers, investors and employees. As well as the trust from politicians and the public. The biggest challenge is to win back that trust," he said at a press conference on Thursday morning.

The audit confirmed that the diesel (NOx) emission inefficiencies were linked to the "misconduct and shortcomings of individual employees," the "weaknesses in some processes" and a "mindset in some areas of the company that tolerated breaches of rules." It did not name any individuals that were involved in the deception.

The investigations are set to continue into the new year but VW highlighted that certain operations and processes would be changed in light of the scandal. It said its IT systems were inadequate and would be updated. It said it was also concentrating on structuring processes more "transparently and systematically," adding that software for engine control devices would be developed more strictly in accordance with a "4-eyes principle," allowing better monitoring and improved decision making.

Chairman of the Board of Management, Matthias Mueller, said: "We are doing everything to overcome the current situation, but we will not allow the crisis to paralyze us. On the contrary, we will use it as a catalyst to make the changes Volkswagen needs."

Potsch added that the investigation was producing "valuable findings, which will help us create a structure that, rather than favoring breaches of regulations, will prevent them, or at least allow them to be detected early on."

A fix for customers

Speaking about a fix for customers that had bought affected models, VW said technical solutions for European buyers had been developed and implementation would begin in 2016. For U.S. customers, where there are far stricter nitrogen oxide limits, it said there was a greater technical challenge to retrofit vehicles. It said it was closely cooperating with EPA (U.S. Environmental Protection Agency) and a solution for North America would be presented as soon as it has been approved ‎by authorities. Mueller later told CNBC that there were no plans to reduce product prices in the U.S. at the moment.

There was positive news from the German carmaker on Wednesday with an announcement that only 36,000 out of the 800,000 vehicles initially estimated to have understated CO2 levels thought to have been actually impacted. The company added that "no unlawful change to the stated fuel consumption has been found to date."

Shares of the company rose 6.5 percent on Wednesday and were up 2.5 percent during Thursday's press conference. However, its stocks tuned negative and fell 0.7 percent by the end of the announcements by the supervisory board. It closed higher 1.14 percent on Thursday.

VW is seen as needing to slash costs in an effort to cope with the financial fallout from the crisis. It confirmed Thursday that it would be bringing in a new corporate structure by 2017 but would not be selling any of its units.

The diesel scandal affects around 11 million vehicles worldwide and has forced the group to take extensive measures to save its reputation and shore up balance sheets. It admitted on September 18 it used illegal software to manipulate emissions tests on diesel vehicles in the U.S., sparking the biggest business crisis in its history.

The admission has seen the automaker's share price tumble over 20 percent in the last three months, as well as forcing out its long-time chief executive and sparking investigations and lawsuits across the world.