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Volkswagen Isn't Cheap These Days, But Offers Quality Products At Competitive Prices


  • The emissions scandal is in the company's rearview mirror.
  • Bondholder lawsuit dismissed, but others pending.
  • VLKAF offers value in its products, and it is reflected in their share price.
  • Tariffs and car companies present challenges.
  • Platinum and palladium in cat converters.

Decades ago I bought my first German automobile, a Mercedes Benz. Since then, I appreciated the quality of German workmanship and had owned BMWs and an Audi, and over the past six years, I have become a fan of Volkswagen's (OTCPK:VLKAF) products. When I moved to Las Vegas in 2012, I bought a small EOS hardtop convertible that was an excellent car that offered both performance and value. When I heard that the company was ending production of the EOS, I quickly traded my three-year-old EOS for a new model in the final year of its availability.

The time came for a bigger car, one I could fill with weekly goodies from Costco, and I exchanged the little zippy EOS for a Tiguan, the small SUV offered by the company. The three VWs I have driven over the past six years have never given me any problems and have only been a source of enjoyment. Even when VW's reputation was at its nadir a few years ago over the emissions scandal, I have found the company's product meet my requirements and sales and service were superior to other dealerships in my experience. VW has gone through a tough time, but it seems they are emerging stronger than ever in the U.S. market.

The emissions scandal is in the company's rearview mirror

The scandal came to light in September 2015. The U.S. EPA issued a notice of violation of the Clean Air Act to Volkswagen Group. The agency accused VW of intentionally programming turbocharged direct injection diesel engines to activate their emissions controls only during laboratory testing which caused emissions to meet U.S. standards. However, in real-world driving, the car's emissions turned out to be forty times higher. VW deployed the programming software in eleven million cars worldwide, of which 500,000 were in the U.S. in model years from 2009-2015.

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This article was written by

Andrew Hecht profile picture

Andrew Hecht is a 35-year Wall Street veteran covering commodities and precious metals.

He runs the investing group The Hecht Commodity Report, one of the most comprehensive commodities services available. It covers the market movements of 20 different commodities and provides bullish, bearish and neutral calls; directional trading recommendations, and actionable ideas for traders. Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The author always has positions in commodities markets in futures, options, ETF/ETN products, and commodity equities. These long and short positions tend to change on an intraday basis.

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Comments (7)

Sextus profile picture
Love your argument:" better safe than sorry"
VW is great brand....and i think the reals stock value is above 200, its deep value, with its low EV/ebitda ratio below 5.....but it has the product range that is like less then 3 years old, so many new models coming out under various brands.....Europeans in general make best cars and Japanese :) i dont know why is that so.
VW bought back my Gold TDI for over 20k. I bought their stock at 113 she's lots of it. win-win. 😁
Pete Palmer profile picture
My buyback payment bought more CDEV shares.
Pete Palmer profile picture
VW quality made giant leaps from the 80's/90's to the 00's. Quality is still high, but the diesel scandal was a disappointment. VW bought back my TDI and until diesel emissions technology changes, I'll never own another because of it's complexity and high cost to repair.

What I like about VW is the various brands under its umbrella that play in just about every market segment. Seat, Skoda, VW, Audi (cash cow), Porsche, Bentley, Bugatti, Lamborghini, Ducati, MAN, and Scania.

Seat is the weakest link and is dependent on its home market.
Good, thoughtful article. i especially liked your attention to the commodities. Thanks.
Boilermaker_KK profile picture
VW EOS = performance ?
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