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Business

VW settles supplier row after marathon talks

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Opening sequence

Business

VW settles supplier row after marathon talks

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COMING UP:VW settles supplier row after marathon talks

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00:00:01
>> Volkswagen didn't need the media attention or the cost of lost production, two good reasons, then, to settle a dispute with suppliers. Talks went through the night with two of them, seat maker Car Trim and ES Automobilguss, which makes parts for gear boxes. An agreement was reached after 20 hours.
00:00:19
>> Volkswagen have been guilty in the past of suddenly using their power, using their huge size to lean on suppliers and saying, we're basically going to sign the deal that we want, and if you don't want it then you can swing for it. And I think Prevent have maybe realized that they were going up against a behemoth and have settled as a result.
00:00:37
>> The conflict had been threatening VW's profitability following last year's emissions test cheating scandal. 28,000 workers at six of the carmaker's ten German factories were affected. And on Monday, production of top selling Golf and Passat models was halted. The suppliers were seeking compensation for lost revenue they said ran into tens of millions of Euros after VW cancelled a contract.
00:01:00
Germany's economy ministry stuck its oar in, warning of the broader impact on jobs. UBS analysts had estimated one week of lost production at VW's Wolfsburg headquarters would result in 100 million Euros in lost gross profit. Money VW could ill afford when it's facing billions of euros of costs from the emissions scandal.