Three months after announcing the biggest annual loss in the company’s history for 2015 due to its diesel emissions scandal, Volkswagen in July unveiled unexpectedly high profits for the first half of this year, fuelled by sales of VW cars in China.
There, unlike Europe and the US, the VW brand has not been tarnished by the German carmaker’s scandal, and Chinese demand for vehicles is strong in spite of the country’s economic slowdown.
But China’s tolerance for polluting vehicles — the market is dominated by cars powered by petrol engines — is now drawing to an end. A rollout of new legislation due to be completed by 2020 aims to tighten China’s rules on cars’ emissions and fuel economy, bringing them into line with western countries and thereby curbing the industry’s contribution to global warming and air pollution.