DBRS downgrades Volkswagen

DBRS Ltd. said it downgraded the long-term ratings of Volkswagen AG to A (low) from A. All ratings, including the short-term ratings, are under review with negative implications.

The rating action follows ongoing developments associated with VW’s mounting (diesel) vehicle emissions controversy, which may serve to further pressure the company’s credit risk profile, DBRS said in a news release.

In early November, the U.S. Environmental Protection Agency issued VW a second notice of violation of the Clean Air Act, alleging that light-duty diesel vehicles from model years 2014 through 2016 of the VW, Porsche and Audi brands equipped with 3.0 litre engines contain a defeat device to circumvent EPA emissions standards.

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