As we hunker down for the back stretch of 2015 and enjoy our pumpkin spice lattés, break out our sweaters and root for our local Top 20-ranked football teams, we have much to be thankful for. Reflecting on the recent news brought to light regarding Volkswagen, I am also very thankful that we, residents of Genesee County, can hold our heads high and be proud of the local men and women who are in charge of engineering as well as assembling some of the best made, most fuel efficient and environmentally safe vehicles in the world! GO FLINT! GO GM!
For those who are unaware, one of GM’s biggest competitors, Volkswagen, came clean last month regarding one of the most epic scandals the auto industry will ever see. According to bigcharts.com on September 22, 2015, Volkswagen, whose stock symbol (ADR) trades under VLKAF, has tumbled over 44 percent since its April high, and fell roughly 36 percent in just ten trading days in late September alone. This last crash in the stock was perpetuated by the news that the carmaker had engaged in fraudulent emissions testing. The scandal boiled down to the company rigging computer systems in their diesel vehicles, so that during regulatory testing, the computers would change the car’s composition so that the emission levels would pass testing standards. As soon as the car was disconnected from the testing gear, it would go back to polluting our air here in America at totally unacceptable levels.
Steve Kalafer, an auto dealer in Flemington, NJ, told CNBC that Volkswagen’s diesel deception is a major fraud against consumers and VW dealers like him. “This scandal, this fraud, makes Madoff look like the minor leagues,” said Kalafer.* I am by no means an auto-analyst, but I believe that because this is such a gross injustice against consumers and done completely with malice, greed and deceit in mind, the eventual fines and distrust of the company will at best put VW on the ropes for years. There is also a small chance that this will cause the Auto Giant to file bankruptcy, as noted by this headline from Daily Mail: “Volkswagen facing dozens of class action lawsuits from all 50 states over emissions scandal as experts warn Germany’s biggest car maker could go BANKRUPT!”**
As we pass around the turkey again this year and think of all that we should be thankful for, we need to, once again, consider supporting local businesses along with the men and women they employ. I challenge us all to seriously consider purchasing from local American car dealerships when we look for our next vehicle. Although they are not perfect, they are doing their best to produce sharp-looking, economical cars, while working to ensure that they are not endangering the health of our children and grandchildren.
From the team at OLV Investment Group: Happy Thanksgiving, everyone!
*CNBC.com
**dailymail.com
800.338.4586 olvinvest.com The Durant 607 E 2nd Ave., Ste. 100 Flint, MI 48502 jlagore@olvinvest.com Securities offered through Sigma Financial Corporation, member FINRA/SIPC. Investment advisory services offered through SPC, a registered investment advisor. OLV Investment Group is independent of Sigma Financial Corporation and SPC.
