Volkswagen sues former supplier “Prevent” for 100 million Euros in damages

In an ongoing legal battle, the Volkswagen Group sued its former supplier, Prevent, for damages worth 100 million euros (equivalent to $112 million) following an acquisition by the Bosnian supplier led to production losses for Volkswagen.

The Legal Battle Between Volkswagen And Prevent Has Been Going On Since 2016

In 2016, shortly after Prevent acquired Volkswagen’s suppliers, ES Guss and Car Trim, the two companies stopped supplies in a bid to increase prices. This led to losses in production at 6 Volkswagen factories in Germany and the circumstances culminated into a legal battle between Prevent and Volkswagen. The car company reported that it had also filed the first claim for its subsidiary, Skoda, with the Brunswick regional court.

Volkswagen added that the Dresden higher regional court would take up the matter and then decide regarding the damage claims. The Volkswagen Group is said to have canceled all its contracts with Prevent in April last year after 25 years of receiving seat assemblies and cast parts by the Bosnian supplier.

Prevent, on the other hand, refused to comment, stating that it did not have a copy of the lawsuit. The supplier had previously filed a claim against Volkswagen in November for damages of more than $750 million. The company is reported to have approximately 3,400 employees at its 8 facilities in Germany and employs more than 30,000 people worldwide.

Volkswagen’s Spanish Brand “Seat” CEO, Luca de Meo, To Quit Volkswagen

Earlier on Tuesday, the German carmaker had reported that Luca de Meo had stepped down from his position as Chief Executive of the Volkswagen’s Spanish brand “Seat” amid speculations that he was approached by car giant Renault.

“Luca de Meo, Chief Executive of Seat S.A. has had his duties as chief executive of Seat revoked at his own request and by mutual agreement,” said a Volkswagen representative said in a statement on Tuesday.

If the speculations are true, de Meo would replace Thierry Bollore who was dismissed by Renault in October in an attempt to step out from a continuous period of scandals. Earlier in 2018, Renault was defamed when ex-boss Carlos Ghosn was arrested over charges of financial misconduct and the company is now said to be taking steps to counter the negative associations.

Volkswagen is currently trading at around 178.0 EUR in the stock market that marks an around 25% growth as compared to mid-January 2019.