Martin Winterkorn, the former CEO of Volkswagen, is set to stand trial in Germany, nearly a decade after the carmaker’s emissions scandal, often referred to as “Dieselgate,” came to light. In 2015, it was revealed that Volkswagen had installed software in diesel vehicles to cheat on emissions tests, which led to widespread environmental and legal repercussions. Winterkorn, along with other executives, faces charges related to this massive scandal, which had significant impacts on both the automotive industry and regulatory practices. The trial represents a major development in the ongoing legal and corporate fallout from the scandal.
This scandal, which involved Volkswagen rigging millions of diesel vehicles with software designed to cheat emissions tests, had far-reaching consequences. It not only led to significant legal and financial repercussions for the company but also prompted a broader reckoning within the automotive industry regarding emissions standards and corporate ethics. The trial of Winterkorn marks a pivotal moment in addressing the accountability of senior executives in the scandal.
Martin Winterkorn, who led Volkswagen from 2007 until his resignation amid the scandal in September 2015, is now standing trial in Braunschweig, Germany. Despite his attempts to delay the proceedings due to health concerns, the court has proceeded with the trial. This case is significant because it will test the ability of German legal systems to hold high-level executives accountable for major corporate misconduct. The emissions scandal not only had a massive financial impact on Volkswagen, costing the company tens of billions of dollars in fines, lawsuits, and vehicle buybacks, but it also had broader environmental and health implications, affecting air quality both in Europe and the United States.
Martin Winterkorn, once Germany’s highest-paid executive, faces serious criminal charges including fraud, market manipulation, and making false statements. Prosecutors allege that Winterkorn was aware of the emissions-cheating software as early as 2014 but failed to inform regulatory authorities and Volkswagen car owners about the illegal practices. This failure to act on the information, according to the charges, significantly contributed to the scale and impact of the emissions scandal. The trial is closely watched as it tests the accountability of top executives for corporate wrongdoing and its far-reaching consequences.
Prosecutors argue that Martin Winterkorn, with his knowledge of the emissions cheating, allowed Volkswagen to continue selling vehicles equipped with the illegal software until the scandal was uncovered by California regulators and the Environmental Protection Agency (EPA) in 2015. Over a span of more than a decade, Volkswagen, along with its brands Audi, Skoda, and Seat, sold approximately nine million cars with this fraudulent software. This widespread use of the software not only led to significant legal and financial repercussions for Volkswagen but also had considerable environmental impacts and eroded public trust in the company.
Winterkorn is also accused of lying under oath during his testimony before a German parliamentary committee investigating the scandal. These additional accusations further compound the seriousness of the charges against him, as they involve both deceptive actions to avoid regulatory scrutiny and allegations of perjury in a formal investigative setting.
The market manipulation charge arises from allegations that Mr. Winterkorn failed to notify Volkswagen shareholders of the financial risk posed by the software as required by securities law.
The trial of Martin Winterkorn began with prosecutors presenting all three indictments against him. Winterkorn arrived at the court early, dressed in a dark blue suit. Despite appearing tired as the charges were read, his lead attorney, Felix Dörr, reassured that Winterkorn was in good health. The presentation of the indictments marked the formal start of the legal proceedings, setting the stage for what is expected to be a complex and high-profile trial.
The case indeed highlights the challenges prosecutors face when trying to hold top corporate executives accountable for wrongdoing. High-ranking managers like Martin Winterkorn often have layers of distance between themselves and the day-to-day activities that lead to illegal behavior, complicating efforts to prove direct involvement or knowledge.
Winterkorn, known for his authoritative management style and quick temper, has maintained that he was unaware of the emissions cheating. He has shifted the blame to lower-level employees, asserting that the wrongdoing was orchestrated by subordinates without his knowledge. This defense strategy is common in high-profile corporate cases, where the complexity of the operations and the hierarchy within the company can make it difficult to pinpoint accountability at the top.