Major insurer set to sue VW

A major international insurer is weighing up its options to sue Volkswagen after its shares dipped sharply following last year’s emissions scandal, according to reports.

Reuters is reporting that German insurer Allianz is priming to begin legal proceedings against the carmaker within the month.

Thomson Reuters data shows that Allianz Global Investors (AGI) holds 0.06% of VW preference shares and just 10,000 ordinary shares, meaning it will have lost US$9.5 million on its stake.

“As asset manager it is our fiduciary obligation to evaluate potential claims against capital market participants and, if necessary, follow through in the best interest of our investors,” AGI stated.

“A potential compensation would be for the benefit of the funds.”

The emissions scandal has already seen the exit of the previous chief executive and hit VW’s share price by 31% since the issue emerged in September.

The carmaker also faces dozens of private lawsuits in Germany.

However, these cases pale in comparison to potential costs VW faces in the US.

The Justice Department has sued the carmaker for up to US$46 billion for breaching environmental laws, where an additional 500-plus lawsuits have also been filed against the company.

A successful Allianz lawsuit would put further strains on the company, however, with the VW’s labour leader earlier this month warning that the extent of possible job cuts at the company would depend decisively on the level of U.S. fines for its cheating of emissions tests.