Continental CEO: Volkswagen Scandal Could Kill U.S. Diesel Car Market

In a recent interview, Continental CEO Elmar Degenhart told German newspaper Boersen-Zeitung that the Volkswagen emissions cheating scandal could lead to diesel passenger cars disappearing from three markets, including North America, Japan, and China. He added that in these three regions, the  market share of diesel-powered vehicles are only 1-3 percent, which is significantly lower than in Europe where it’s 53 percent.

Volkswagen initially brought diesel-powered vehicles to North America as a clean alternative to gasoline and hybrid-powered vehicles. However, in September 2015, the automaker was caught using software that makes the car produce less nitrogen oxide (NOx) during emissions testing. During regular driving, Volkswagen’s diesel-powered vehicles produced 40 times more NOx than the legal limit.

Degenhart also stated that Continental supplied engine controllers to Volkswagen that are in line with the automaker’s specifications and never produced any type of software that was used to manipulate emissions testing. Bosch, Continental’s, main rival and currently the world’s largest automotive supplier, is under investigation by public prosecutors in Stuttgart, Germany, to find out if it was involved in Volkswagen’s emissions cheating scandal.

While its core business is in manufacturing tires, Continental also produces software, electronics, and sensors for cars. Degenhart also added that the likelihood of the company growing the software and electronics arm is high but Continental doesn’t have any large-scale acquisitions currently planned.  Continental’s development of electric car batteries, on the other hand, continues despite the ending of a joint venture with SK Innovation in 2015. The executive also added that it’s only a matter of time until electric- and hydrogen-powered vehicles takes over. However, he also mentioned that the prices per kilowatt hour of storage must fall below $109 in order for electric cars to succeed.

Source: Reuters

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