Volkswagen CEO to stay away from Detroit auto show

BERLIN (Reuters) - Volkswagen chief executive Matthias Mueller will miss the Detroit auto show next week, the German carmaker said on Wednesday, amid uncertainty over its chances of settling a U.S. criminal investigation into its emissions scandal.

Volkswagen (VW) reached an agreement before Christmas to compensate U.S. owners of about 80,000 polluting 3.0-litre diesel cars, pushing up the costs of its emissions test cheating in the world's No. 2 car market to $17.5 billion.

But VW is still in talks with the U.S. Department of Justice (DoJ) and could spend billions of dollars more to reach a criminal settlement, with sources saying a deal could be struck before the Obama administration leaves on Jan. 20.

 

"There will be no separate event of the VW group (in Detroit) and in view of this fact, the group's executive board will not attend the show," a spokesman at VW's Wolfsburg headquarters said by email.

At the 2016 Detroit show, Mueller drew criticism after telling National Public Radio that VW "didn't lie" when first asked about irregularities between real-life and test emissions in its diesel cars.

The CEO's comments came before Mueller's first meeting with U.S. regulators and sparked a media firestorm in the United States, with some analysts saying they complicated efforts to clear up the emissions scandal.

VW's decision to not have Mueller and fellow managers of the group's nine-member executive board attend the 2017 Detroit show suggests the company wants to avoid taking risks as it nears an agreement with the DoJ.

VW fears a reboot of its core brand in the United States could be delayed by six months or more if it fails to reach a deal with the outgoing administration, as the new DoJ team would need time to get organised, a source at VW told Reuters.

VW plans to drop diesel vehicles in the United States and refocus on sport-utility and electric cars to try to revive its fortunes after the emissions scandal.

Despite a 20 percent jump in December sales, the decline in registrations of VW brand vehicles in the United States last year accelerated to 7.6 percent from a 4.8 percent drop in 2015.

(Reporting by Andreas Cremer; Editing by Mark Potter)