It’s Too Late for I’m Sorry!

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Volkswagen shares plunged more than 20 percent on Monday, their biggest one-day fall, after the German carmaker admitted it had rigged emissions tests in the United States, and U.S. authorities said they would widen their probe to other manufacturers.

Questions:
1. Briefly explain the emissions data scandal.
2. What was the recent challenge to Volkswagen Chief Executive Martin Winterkorn and what changes in the organization are likely for the future?
3. What types of legal challenges will the company face and by what government agencies?

Source:
Cremer, A. and V. Volcovici. (2015). Volkswagen shares plunge on emissions scandal, U.S. widens probe. Reuters.com, Sep. 21 (Retrievable online at http://www.reuters.com/article/2015/09/21/us-usa-volkswagen-idUSKCN0RL0II20150921)