Volkswagen AG was imposed a fine of €1 billion ($1.18 billion) by the German authorities over diesel emission scandal, per Reuters. This is one of the highest fines leveled against a company by the German authority. This German automaker accepted the allegations and shouldered responsibility for that.
Volkswagen failed to adequately supervise activities of the engine development department. This resulted in 10.7 million diesel vehicles with illegal emission-controlling software being sold worldwide. In fact, the auto giant is grappled with the same scandal since 2015, which surfaced in the United States. The German automaker has already paid $20 billion in fines and civil settlements in the United States.
This penalty is the latest blow to the German auto industry, which is grappling with diesel emission scandals. Recently, another German vehicle giant, Daimler AG (DDAIF - Free Report) has been ordered by the government to recall about 240,000 cars, fitted with prohibited emission-control devices.
Over the past six months, shares of Volkswagen have underperformed the industry it belongs to. During this period, shares of the company have declined 6.9% while the industry edged down 1.1%.
While Daimler currently carries a Zacks Rank #2 (Buy), Volkswagen has a Zacks Rank #3 (Hold). Daimler and Volkswagen have an expected long-term growth rate of 5% and 6.2%, respectively.
A few top-ranked stocks in the auto space are Oshkosh Corporation (OSK - Free Report) and Allison Transmission Holdings, Inc. (ALSN - Free Report) , each sporting a Zacks Rank # 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Oshkosh has an expected long-term growth rate of 18.3%. Shares of the company have risen 10.2% over the past year.
Allison Transmission Holdings has an expected long-term growth rate of 10%. Over the past year, shares of the company have gained 11.1%.
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