[the Thing]

Hey guys,

What do y'all think about VW stock in the long term? You probably heard the recent news about how they cheated on emissions tests and how big a fine they're facing. VW lost 37% value in the past week and I don't think a company as big as VW can ever go bankrupt- worst that could happen is the German government will probably bail them out.

I'm looking to bottom fish but it might be too early for that. Thoughts?

[LeBeau]

There are multiple stock market related threads for this discussion.

[jamaicabound]

(09-24-2015 05:11 PM)LeBeau Wrote:  

There are multiple stock market related threads for this discussion.

Sorry not sure if were continuing this discussion here or not, I strongly considered it but so often whether lumber liquidators or other stocks I've learned not to try to catch a falling knife as they say.

I think this whole thing is overblown. Heck several other car companies have been in trouble for similar things. Aslo other car companies have knowingly done things which have killed people and put people in danger, this is cheating on emission tests which though not ethical isn't going to kill anyone, it's not a safety issue, etc.

I think this stock will continue to fall a bit I'm sure some people will come out with class actions and maybe some more negative news comes out. When the dust settles I probably will pick some of this up as a long term hold with my sepira, not my real money account.

[Capitán Peligroso]

And it's too early to bottom fish.

Hundreds of thousands of people bought these cars for good money, and now they're taking a bath on them. You can hope like hell that regulators are going to go easy on them in the long run and try to make a soft landing here, and while that is probably true if past history is any indication, a lot of people lost a lot of money and it's going to be a VERY expensive proposition to make them whole, tens of billions of either VW or taxpayer dollars (with the requisite political fights along with it, if a taxpayer bailout is in the offing) if the numbers I'm reading are any indication.

An experienced investor could still make some money on the right option plays, given that the option prices on VW already have this volatility baked into the pricing cake by now, but if you're on this forum asking about this, you're not one of those investors.

A lot of people spent 30-40 grand on these cars with the expectation of certain standards of emissions and performance, and now they're not going to get either. And as a result of this, VW's reputation is going to take a pretty serious hit, and deservedly so. They did this with malice aforethought.

Some points on the geopolitical ramifications here.

[el mechanico]

Let the migrants live in all of their factories!

J/k

I know these software hacks cause we beat them all day long at my job. Of course you want your shit to run good.

Now. The betaness of VW.

The should've lied and said the programming was for traffic. No balls.

Also the US uses different Diesel

[jj90]

If you have a 5+ year horizon and can handle the volatility, buy VW now. It's a no brainer. Liability is nowhere as large as BP circa 2010 and BP had to pay a massive bill. BP did well after 2010 until oil collapsed.

[jamaicabound]

(09-24-2015 05:40 PM)Capitán Peligroso Wrote:  

And it's too early to bottom fish.

Hundreds of thousands of people bought these cars for good money, and now they're taking a bath on them. You can hope like hell that regulators are going to go easy on them in the long run and try to make a soft landing here, and while that is probably true if past history is any indication, a lot of people lost a lot of money and it's going to be a VERY expensive proposition to make them whole, tens of billions of either VW or taxpayer dollars (with the requisite political fights along with it, if a taxpayer bailout is in the offing) if the numbers I'm reading are any indication.

An experienced investor could still make some money on the right option plays, given that the option prices on VW already have this volatility baked into the pricing cake by now, but if you're on this forum asking about this, you're not one of those investors.

A lot of people spent 30-40 grand on these cars with the expectation of certain standards of emissions and performance, and now they're not going to get either. And as a result of this, VW's reputation is going to take a pretty serious hit, and deservedly so. They did this with malice aforethought.

Some points on the geopolitical ramifications here.

Why do you say car buyers are taking a bath? In resale value? In the grand scheme of things I have a hard time wrapping my head around how this story is that big of a deal. From my understanding this doesn't affect gas mileage, isn't a safety issue, etc.

Ford and GM and others have knowingly put out cars that killed people and that is water under the bridge, how is lying about emissions this huge deal the media is making it out to be?

Also, for anyone who knows cars maybe you can chime in. If Volkswagen is forced to do a recall and fix these cars is it new parts or is it as simple as plugging the car into a computer and reprogramming the software?

From what I've heard what volkswagen did is what many car people do to their cars as an aftermarket mod to get better performance and then switch teh chips back anytime they have to go through emissions. I could be totally off base on this but someone on another forum mentioned this.

[the Thing]

(09-26-2015 06:03 PM)jamaicabound Wrote:  

From what I've heard what volkswagen did is what many car people do to their cars as an aftermarket mod to get better performance and then switch teh chips back anytime they have to go through emissions. I could be totally off base on this but someone on another forum mentioned this.

More like, they had software on their cars to detect if it's being emissions tested and adjust output accordingly. Cars would perform within limits on emissions tests, but emissions increased up to 40x more during real world driving.

(09-26-2015 06:03 PM)jamaicabound Wrote:  

Also, for anyone who knows cars maybe you can chime in. If Volkswagen is forced to do a recall and fix these cars is it new parts or is it as simple as plugging the car into a computer and reprogramming the software?

Current generation diesel engines all treat their exhaust with a urea based fluid called "AdBlue" to meet emissions requirements. It's a consumable and therefore adds to the overall cost of ownership. Everyone used AdBlue to match emissions requirements but VW (and we all wondered how). VW can either (1) retro-fit AdBlue in their cars, which will not be easy because their cars aren't designed to accommodate an AdBlue tank, pump, piping etc. related peripherals. Or (2) they can re-program the ECUs and risk a class action, because a software only fix will most likely bring power output and MPGs down.

(09-26-2015 06:03 PM)jamaicabound Wrote:  

Ford and GM and others have knowingly put out cars that killed people and that is water under the bridge, how is lying about emissions this huge deal the media is making it out to be?

Welcome to the politically correct 21st century. Nobody would've given a fuck 30 years ago.

[Saweeep]

(09-26-2015 06:03 PM)jamaicabound Wrote:  

Ford and GM and others have knowingly put out cars that killed people and that is water under the bridge, how is lying about emissions this huge deal the media is making it out to be?

The difference here is that VAG is a German company.

US regulators love to gang fuck a foreign competitor. See BP.

[DVY]

The damage is just starting. VW is a cockroach motel. I'd stay away for at least a year.

Car design and production is a 100MM+/per platform necessity.

Recalls and fines will wipe out 2-3 years of profit, design and manufacturing issues will wipe out another 1/2 year. Its going to be a long road ahead.

VW owns audi. Audi is going to be under heavy scrutiny now too. If it starts spreading to the luxury side of VW, all bets are off to what the damages will be.

[Peregrine]

(09-28-2015 06:54 AM)CrashBangWallop Wrote:  

(09-26-2015 06:03 PM)jamaicabound Wrote:  

Ford and GM and others have knowingly put out cars that killed people and that is water under the bridge, how is lying about emissions this huge deal the media is making it out to be?

The difference here is that VAG is a German company.

US regulators love to gang fuck a foreign competitor. See BP.

(Source: zerohedge)

Should not have been so stingy with the protection money.

[Saweeep]

Indeed.

Even I know that the way to crack business in America is to grease all the right palms!

Funnily enough it was Vag that got caught out in the great "prostitute" scandal a few years back. Idiots.

[JacksonRev]

I would wait unless you think VW will transition back to military production in the near term.