Volkswagen‘s chief executive Martin Winterkorn has announced he is stepping down following news that the automaker is facing multiple class action lawsuits after the company admitted to cheating emissions testing on 11 million cars. To mount a defense, the German carmaker hired Kirkland & Ellis, the same law firm that BP used after the Deepwater Horizon disaster. Given VW’s reputation for environmentally-friendly designs, this news has shaken the auto world, leaving consumers and shareholders with a lot of doubts about their loyalty to the second largest carmaker in the world.

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The worldwide auto industry, along with consumer and environmental groups, are watching closely to see how this case unfolds. Already, accusations against the carmaker have rippled outward, involving the German government in the turmoil. The government admitted that it was aware of the existence of so-called “defeat devices” designed to circumvent emissions standards by cheating. However, the transport ministry has denied knowledge that such devices were actually being used by the carmaker, and that accusations to that effect are “false and inappropriate,” according to Transport Minister Alexander Dobrindt.

Related: VW forced to recall nearly 500,000 cars for circumventing smog emission standards

VW has already admitted that 11 million cars worldwide were designed to cheat emissions testing, and the company earmarked €6.5bn ($7.1 billion) to finance the eventual crisis. That may not be enough. A U.S.-based criminal investigation, charges against company executives, and consumer class action lawsuits could wind up costing the carmaker up to $18 billion in the long run.

The company’s chief executive Martin Winterkorn announced he would step down Wednesday, following an emergency board meeting called to determine what action to take against him, since he had previously expressed remorse over the crisis, but refused to resign. Meanwhile, VW shares in Germany have fallen significantly since the news first broke last Friday (10 percent), representing a loss of €25bn ($27 billion) in worth for the carmaker.

Via The Guardian

Lead image via Wikicommons; others via Volkswagen