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Speaker 1: I'm Katherine Cowdery. We check the markets every fifteen minutes
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Speaker 1: Word Breaking news desk for today's afternoon call with Bill Maloney. Bill,
Speaker 1: Good afternoon, Katherine Sharp gains for u S stocks after
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Speaker 1: Dow Transports jump two per set, Nasibotex rise three point
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Speaker 1: leaders included Travelers, Jape and Morgan, and Visa, while DuPont
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Speaker 1: over at JP Morgan after the bell Tonight look for
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Speaker 1: First and Breagan News desk on Bill Maloney, Katherine, thank you,
Speaker 1: billan to hear live breaking news over your Bloomberg type
Speaker 1: squ a k on your terminal. West Texas Intermediate crude
Speaker 1: oil is up a dollar forty eight of barrel three
Speaker 1: point two percent to forty one. Spockle down nine dollars
Speaker 1: fifty cents announced at thirteen fifteen twenty and the ten
Speaker 1: year treasury down five thirty seconds with the yield of
Speaker 1: one point four five percent. And that's a Bloomberg business
Speaker 1: flash you're listening to taking stock with Pim Fox and
Speaker 1: Kathleen Hayes on Bloomberg Radio. Fourteen point seven billion dollars.
Speaker 1: That's what v W has agreed to pay to settle
Speaker 1: its claims from the emissions cheating scandal. It's one of
Speaker 1: the nation's largest consumer class action settlements on record, and
Speaker 1: in fact it is the largest ever paid by an
Speaker 1: auto company. Joining US now is Patrick Ambrosio. He's environmental
Speaker 1: reporter for Bloomberg b n A. He joins US now
Speaker 1: from b NA headquarters in Alexandria, Virginia, the Washington d C.
Speaker 1: Metro area. He was over across the river looking at
Speaker 1: and listening to some very important testimony today. Patrick, thank
Speaker 1: you for joining us. Yeah, thanks for having me. So
Speaker 1: you were at the Department of Justice as press conference.
Speaker 1: You're sitting on a call with plaintiffs attorneys. First of all,
Speaker 1: tell us a little bit more about the settlement. I
Speaker 1: understand that a big chunk of this money is going
Speaker 1: to be used to buy back cars with the with
Speaker 1: the diesel engines. Uh, buying back from the customers. I
Speaker 1: guess I'd be pretty lucky in a sense if I
Speaker 1: owned one. Yeah, that is a significant portion of that
Speaker 1: big fourteen point seven billion number. Today, About ten billion
Speaker 1: of that is going to go to consumers. Uh. The
Speaker 1: consumers will have options. There's going to be a buy
Speaker 1: back option that should start later this year. Uh. It's
Speaker 1: how much you're gonna get it brought back for. It
Speaker 1: is going to depend on the model. Uh. It could
Speaker 1: range anywhere from twelve thousand, five hundred for some of
Speaker 1: the older vehicles to as much as forty four thousand
Speaker 1: for for some of the more recent vehicles. UH. It's
Speaker 1: there's also the still the potential for a fix. UH,
Speaker 1: Folkswagan has been looking for a way to bring these
Speaker 1: vehicles into compliance with the emission standards. They haven't gotten
Speaker 1: it approved, but if they do get one approved, UH,
Speaker 1: sometime in the near future, consumers will be able to
Speaker 1: get it to proved for get it fixed for free,
Speaker 1: and get a payment on top of that to cover
Speaker 1: any any sort of issue that they may have. So
Speaker 1: what kind of things did you hear to at a
Speaker 1: press conference today and on this call a plane if attorneys?
Speaker 1: What what is being said? What's the mood? What's the
Speaker 1: sense of where this goes next? Uh? Well, the mood
Speaker 1: uh for the class action of planets for the people
Speaker 1: that bought the cars that they were saying, you know,
Speaker 1: this is this is what we wanted. We wanted substantial
Speaker 1: compensation for the people who bought these cars and didn't
Speaker 1: get what they paid for the buyback option. That was
Speaker 1: something that was really pushed for because there were a
Speaker 1: lot of people who are not happy Uh, there were
Speaker 1: a lot of environmentally conscious consumers who bought these cars
Speaker 1: because they were marketed as being you know, clean diesel,
Speaker 1: they're better for the environment. People bought them and then
Speaker 1: only to find out they were allied to and they're
Speaker 1: actually significantly worse than they thought. On the government side, Uh,
Speaker 1: it was you know, it's it's obviously a historic settlement,
Speaker 1: but you know it's been described by Justice farming officials.
Speaker 1: This is only the first step. This only solved some
Speaker 1: of the problems. There's still a lot more on the table,
Speaker 1: including possible criminal charges as well as of all, penalties
Speaker 1: aren't addressed on this soil. Volkswagen could end up paying
Speaker 1: a lot more than that fifteen billion. Give us a
Speaker 1: sense of how that might add up and who will
Speaker 1: they pay it to. I understand a significant civil penalties
Speaker 1: from the federal government. This is something you have been
Speaker 1: analyzing in your Bloomberg Intelligence research. But could it be
Speaker 1: another fifteen billion? Would it be five hundred million? Where
Speaker 1: does this how does this potentially stack up? Yeah, you know,
Speaker 1: it's that's something they were very moment today. They said,
Speaker 1: we're still in the discovery phase. Uh. They got more
Speaker 1: than one point five million documents from Volkswagen that they're analyzing. UH,
Speaker 1: and and this settlement really doesn't affect any of those
Speaker 1: allegations that the civil penalties would be for violating the
Speaker 1: Clean Air Act, the environmental law that they violated when
Speaker 1: they sold these cars. UH. It's significant penalties are on
Speaker 1: the table. UH, it's whether it's likely to be settled,
Speaker 1: but we don't know what that number is going to
Speaker 1: look like and how the the money that they've already
Speaker 1: agreed to pay, how that's going to affect what the
Speaker 1: what the eventual number that the Justice Department is going
Speaker 1: to settle on to to really punish them for what
Speaker 1: they did. Criminal investigation, what would rise to the level
Speaker 1: of criminal conduct? Would involve more fines? Would it involve
Speaker 1: jail time? It depends. There's there's could be both criminal
Speaker 1: penalties sought against the company itself as well as individuals. UH.
Speaker 1: Deputy Attorney General Yates said today that they are investigating companies,
Speaker 1: they're investigating individuals who worked at Volkswagen. UH. There there's
Speaker 1: monetary penalties. There also is the possibility of jail time, UM,
Speaker 1: though it's not clear how that would work out. It
Speaker 1: if the people were you know, German citizens working in Germany.
Speaker 1: What kind of jurisdiction there would be there, That's still
Speaker 1: a question that remains to be seen. Yeah, a lot
Speaker 1: of big questions if it goes that far. What's next?
Speaker 1: What are you watching next? And what should we be
Speaker 1: watching nick met next? As Uh, this first settlement has
Speaker 1: agreed and other charges are pursued. Well, right now, it's
Speaker 1: a proposed settlement. It undergoes a comment area than the
Speaker 1: judge needs to approve it, so that should be wrapped
Speaker 1: up sometime in the fall. Uh. And then consumers will
Speaker 1: actually need to take action and sell back their car
Speaker 1: if they want to. Uh. As far as what's next,
Speaker 1: keep looking out for possible criminal charges. Uh. There's also
Speaker 1: individual states are still pursuing actions. Uh. And and what's
Speaker 1: going to happen in Europe? They they they still haven't
Speaker 1: figured out what they're doing for the car owners in Europe.
Speaker 1: So so really we don't know what the finals have
Speaker 1: on this is gonna be, but it's it's gonna be high.
Speaker 1: I'll starting a fifteen billion, my friend. Uh, that's uh,
Speaker 1: that's not chump changes people used to say. Patrick Ambrosio
Speaker 1: is environmental reporter for Bloomberg b NA based in the
Speaker 1: Washington d C. Metro area Arlington, Virginia. This is Bloomberg Radio.
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