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VW plant cuts shift, financial arm freezes hiring

FILE - In this Sept. 23, 2015 file photo, diesel Volkswagens are seen behind a security fence on a storage lot near a VW dealership in Salt Lake City. Volkswagen is far from the first company to stand accused of trying to game required emissions tests. Almost since the passage of the Clean Air Act in 1970, major manufacturers of cars, trucks and heavy equipment have been busted for using what regulators call “defeat devices” _ typically programing a vehicle’s on-board computer to boost horsepower or fuel mileage by belching out dirtier exhaust than allowed. (AP Photo/Rick Bowmer, File)
FILE - In this Sept. 23, 2015 file photo, diesel Volkswagens are seen behind a security fence on a storage lot near a VW dealership in Salt Lake City. Volkswagen is far from the first company to stand accused of trying to game required emissions tests. Almost since the passage of the Clean Air Act in 1970, major manufacturers of cars, trucks and heavy equipment have been busted for using what regulators call “defeat devices” _ typically programing a vehicle’s on-board computer to boost horsepower or fuel mileage by belching out dirtier exhaust than allowed. (AP Photo/Rick Bowmer, File)

By Associated Press 2 min read

BERLIN (AP) – A Volkswagen engine factory said Wednesday it has dropped one shift a week and the company’s financial services division imposed a temporary hiring freeze as the world’s largest automaker grapples with an emissions-rigging scandal.

The extent of the fallout from the scandal, which erupted Sept. 18 when the U.S. Environmental Protection Agency said VW had cheated on tests of its diesel cars, remains unclear as do the costs to Volkswagen. Longtime CEO Martin Winterkorn quit last week, but said he was aware of no wrongdoing on his part.

In Germany, Stella Pechmann, a spokeswoman for the engine plant in the city of Salzgitter, confirmed a report Wednesday in the Wolfsburger Allgemeine Zeitung daily that a “special shift” is being cut as a precaution because of the current situation. The shift had previously been added to deal with high demand.

Separately, the Volkswagen Financial Services division is freezing new hiring until the end of the year, though spokesman Stefan Voges told news agency dpa that existing hiring agreements are unaffected.

The scandal has raised concerns that the reputation of German automakers and engineering as a whole could be tarnished, though Finance Minister Wolfgang Schaeuble said he doesn’t see the affair damaging Germany as a business location.