BERLIN -- German prosecutors have imposed a fine of 535 million euros ($598.99 million) on Porsche for neglecting supervisory obligations linked to diesel-emissions cheating.
Prosecutors in the southern city of Stuttgart said that the company's development department had neglected its legal obligations, which ultimately led to the sale of diesel cars in Europe as well as other regions that did not comply with emissions rules.
Porsche, a subsidiary of Volkswagen Group, has not appealed, they said. The fine does not hinder ongoing proceedings against individual people in relation to Porsche's diesel manipulations, the prosecutors said.
Porsche confirmed the fine and said that prosecutors' proceedings against the company had now come to an end. The Porsche brand itself never developed diesel engines but its managers failed to properly supervise their use in the vehicles, leading to the probe, Porsche said.
"Concluding the proceedings is another important step towards ending the diesel topic," Porsche said. "In the fall of 2018, Porsche announced its complete withdrawal from diesel and is fully focused on the development of cutting-edge gasoline engines, high-performance hybrid powertrains and electric mobility," the company said in a statement.
U.S. authorities disclosed Volkswagen's systematic emissions cheating on Sept. 18, 2015, sparking the biggest business scandal in the company's history which has cost VW Group 30 billion euros in penalties and fines.
VW, Porsche and Audi all sold diesel engine cars which failed to conform to clean air rules and cheated emissions tests. The penalty covers the sale of Porsche cars since 2009 that were equipped with V-6 and V-8 engines from Audi.
German prosecutors have pursued individual engineers. They took action against the companies for lack of oversight because managers failed to prevent heavily polluting cars from hitting European roads.
With the settlement, Volkswagen completes its deals with German prosecutors over the sale of rigged cars. VW last year settled with Brunswick investigators for 1 billion euros under the same kind of proceedings and its Audi unit followed by paying 800 million euros to Munich prosecutors.
But VW’s diesel woes are far from over. Brunswick prosecutors last month indicted former CEO Martin Winterkorn and three other managers over the scandal. The same authority is due to decide whether to charge the current CEO, Herbert Diess, and Chairman Hans Dieter Poetsch as well as Winterkorn over allegations they failed to inform investors about the scam in a timely manner. The company may also face another fine in that probe. VW and the men deny the allegations.
VW added provisions of 1 billion euros in the first quarter and Tuesday’s fine did not eat up the complete amount. Porsche will book the impact in the second quarter.
Further impact may come from customer claims after VW suffered a setback at Germany’s top civil court in a ruling earlier this year. Just weeks later, judges hearing a 9 billion euro investor lawsuit indicated they may lower the burden for shareholders to show what the company knew when about the illicit conduct.
Stuttgart prosecutors are still conducting similar cases against Robert Bosch as well as Daimler over diesel-rigging allegations.
Porsche was made a suspect in the case in January, almost a year after prosecutors raided the company in the criminal probe that was pending since 2017. Last year, Joerg Kerner, head of engine development at Porsche, was taken in custody as part of the raids but released three month later.
Automotive News and Bloomberg contributed to this report