Just how big or widespread this Volkswagen (VOW) scandal will be is still under scrutiny...What we do know is that based on the latest data we have, German auto producers are one of the least preferred in our autos coverage (Chart 1).. Volume growth looks to have tapered off and pricing power appears limited (Chart 2)....Couple this with increasing costs and you get softer sales growth and margin growth that is starting to moderate... We see a significant (75%) correlation between Volkswagen's sales growth and sales in the German auto sector we cover (Chart 3)... Based on these facts, we don't think that diesel fraud is the only issue VOW or other related companies will face in the foreseeable future.... Subscribers can access the full report here: (VIEW LINK)



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