Opportunism Amidst Penalties?

Last week, Volkswagen finalized a $14.7 billion settlement with U.S. and state regulators, with the potential for billions of dollars more in other fines and settlements. The settlement followed revelations last September that many of the car manufacturer’s turbo diesel vehicles included “defeat devices,” which bypass nitrogen-oxide controls in order to mask emissions during testing.

 The Wall Street Journal editorial board notes possible cronyism related to the settlement. As the board explains, the settlement is apportioned to electric car charging equipment—in which Tesla Motors owns significant infrastructure—in addition to self-driving vehicles, public-awareness programs, and ride-sharing encouragement.

Moreover, if enough of Volkswagen’s customers do not participate in the buyback or repair program, the company will have to pay even more money towards the settlement, per the settlement’s complicated requirements. This could result in an even larger windfall for Tesla and other electric and alternative energy car manufacturers.

While Volkswagen may deservedly be facing penalties for skirting regulations and misrepresenting its vehicle standards to consumers, The Wall Street Journal editorial board reminds readers that ulterior agendas by government leaders and regulators may be influencing the settlement, leading to support for preferred firms and industries.

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