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france 24 Business

Renault shares tumble after police raids linked to VW scandal

© Kazuhiro Nogi, AFP | Reports of anti-fraud raids at Renault factories have sent shares in the French carmaker tumbling.

Text by FRANCE 24

Latest update : 2016-01-14

Shares in Renault took a dramatic turn Thursday after anti-fraud units conducted raids on the carmaker as part of an emissions probe that echoes the scandal engulfing German rival Volkswagen.

News of the raids was first reported by French media earlier Thursday, citing union officials who said the investigators had targeted multiple sites focusing on engine monitoring.

Soon afterward, Renault’s share price sank 22 percent, prompting the company to issue a statement confirming the inspections.

Renault said fraud investigators were looking at the way it uses exhaust-emissions technology in an additional probe of parts and factories that follows an earlier investigation by the French government.

An official with the French Finance Ministry's anti-fraud unit confirmed it had conducted raids on Renault last week but would not elaborate on why. The official was not authorised to be publicly named.

After a probe by US investigators that began in September 2015, Volkswagen admitted to using the so-called “defeat devices” to conceal the level of toxic emissions from some of its diesel vehicles.

The German carmaker faces billions of dollars in claims from customers around the world with similar software installed in their vehicles.

Renault’s stock saw some 5 billion euros wiped from its market capitalisation in its worst day since the company was first listed in 1994, according to Reuters data. The shares pulled back from their losses after the statement to stand down 13.78 percent at 12:46 GMT.

Shares of fellow French carmaker Peugeot also tumbled, amid apparent suspicions that it was being targeted, too. PSA Peugeot-Citroën issued a statement saying that it had not been raided by anti-fraud authorities and that the French government tests on Peugeot-Citroën cars had found no anomalies.

(FRANCE 24 with AP, REUTERS)

Date created : 2016-01-14

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