FILE PHOTO: Volkswagen CEO Martin Winterkorn and Chairman of the supervisory board of Volkswagen Ferdinand Piech on a visit to the plant in Wolfsburg on February 9, 2017 (AFP / Odd Andersen)
Berlin: The emissions scandal ensnaring German carmakers is a risk to Europe’s largest economy, the Finance Ministry said yesterday, adding that it was impossible at the moment to quantify its impact.
In its monthly report, the ministry named the issue, which broke out almost two years ago after Volkswagen admitted to cheating US diesel emissions tests, as a threat to Germany along with Britain’s decision to leave the European Union and protectionist trade policies by the US government.
The car industry is Germany’s biggest exporter and provides about 800,000 jobs. “The so-called diesel crisis should be classified as a new risk to the German economy even though its effects are not possible to quantify at the moment.”
Strong household and state spending provided most of the impulse for the German economy in the second quarter when growth was measured at 0.6 percent.
Weaker net foreign trade dampened growth, as exports grew strongly less than imports.The ministry said it expected the industrial sector to continue its upswing also in the third quarter, pointing to robust orders and strong business sentiment indicators.
