Qatar Holdings, Volkswagen’s third largest shareholder, has suffered financial losses in light of the auto manufacturer’s emissions scandal.
Volkswagen, which is backed by the subsidiary of Qatar’s sovereign wealth fund the Qatar Investment Authority (QIA), faces penalties of up to $18bn for cheating emissions tests.
Diesel cars sold by the German car manufacturer under brands such as Audi, VW and Skoda are believed to have been fitted with illegal software that allows them to falsify emissions tests.
However, Volkswagen cars in the Middle East will be unaffected by the scandal.
No diesel engines from Volkswagen are sold in the Middle East and Levant, and therefore, no cars in the region will be recalled, according to Arabian Business.
In the UK alone, 1.5 million cars are set to be recalled as part of a worldwide recall of at least 11 million cars.
But the worldwide recall is understood not to affect the Middle East as no diesel engines are sold in the region.
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However, Qatar Holdings – a subsidiary of QIA that is the third largest shareholder in Volkswagen with a 17% stake – suffered losses of more than $4.5bn when Volkswagen’s share price plummeted 34% last week.
The car manufacturer saw more than $20bn wiped off its value as a result.
The US Justice Department has launched criminal proceedings into the alleged fraud, which has been cited the biggest scandal in Volkswagen’s 78-year history and is expected to blow a huge hole in the company’s accounts.
Volkswagen has reportedly set aside $7.2bn to deal with recalls, fines, litigation and other costs resulting from the deception.
A spokesperson for Volkswagen’s Middle East and Levant market said they were unable to comment while investigations are ongoing.
Qatar Holding has investments in mineral and natural resources as well as infrastructure projects. It also invests in power generation, water desalination and treatment, heating and cooling systems, and fuel loading and unloading equipment.
