Last week, Volkswagen was well on its way to displacing Toyota as the biggest and most successful auto maker in the world. Now with the revelation over the weekend of its actions to use a software device to defeat environmental regulations on some 11 million cars, Volkswagen has not only had to make a $7.3 billion provision against earnings to cover the costs of fixing the vehicles. It is facing financial consequences that may be far worse. Some analysts argue that Volkswagen’s very survival is in peril, as a result of massive undisclosed technical, regulatory and brand debt that never appeared on Volkswagen’s balance sheet.
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