Volkswagen Falls Off Yahapālanaya, As Maithri And Ranil Hoodwink Public

January 7, 2017

Fibs, miscommunication and the blame game were the highlights this week, as the Yahapalanaya government under President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe fell flat on its face after it was exposed how they attempted to deceive millions of people over a vehicle assembly plant in Kuliyapitiya, which the government claimed was built with an investment of US$ 26.5 million from German automaker, Volkswagen.

However just days after Sirisena and Wickremesinghe laid the foundation stone for the vehicle assembly plant, Volkswagen officially denied that it had not invested in any plants in Sri Lanka in a statement issued to News1st. Following this revelation, Wickremesinghe in a bid to save face told an event in Horana that if the private media channel had asked him, he would have ‘revealed’ the truth. He also claimed that Newst1st had a grudge against him and hence was trying to taint his image.

Wickremesinghe also told the meeting in Horana that Volkswagen will be among several other brands of vehicles which would be assembled at the new plant; however the Times Online quoting Volkswagen Spokesperson Katrin Hohmann reported that the German automaker has not granted license to any Sri Lankan company to assemble cars locally.

Apart from holding the post of Prime Minister of Sri Lanka, Wickremesinghe is also the Minister of National Policies and Economic Affairs. Strangely, while, Wickremesinghe now denies Volkswagen’s role in the vehicle assembly plant, his ministry website which carried a news item on the foundation laying ceremony carries a picture of the Volkswagen logo in the article clearly indicating the automaker’s role in the project.

Another interesting fact is that even the Board of Investment (BOI) which comes under the government has carried an article on the event which also includes a quote from BOI Chairman Upul Jayasuriya who had said that the Volkswagen plant would be a major leapfrog for the country in the right direction.

However, since the controversy, the BOI is yet to issue an official statement to clarify the current situation centering the vehicle assembly plant and as to who the actual investor is and the brands of cars that will be assembled once the plant construction is completed.

State media including the Sri Lanka Broadcasting Corporation and the Daily News also carried news items soon after the event stating that Volkswagen invested in the Kuliyapitiya plant.

When the public took to social media and criticized deputy foreign minister Dr. Harsha de Silva for hoodwinking the public, Silva defended himself saying he never hoodwinked anyone and after initiating the possible investment with Volkswagen, and after maneuvering through difficult territory in terms of possible export, tax and other implications, both he and the then Ambassador of Germany Dr Jurgen Morhard moved out of the process and handed over the responsibility to the implementing parties in the government.

According to Silva, soon after Senok Automobile and BOI signed an agreement in August 2015, Volkswagen, after months of denial, had admitted to the EPA in the US that they had cheated on emissions tests on some of their diesel models in the US, which resulted in the German automobile company’s stocks crashing, and subsequently the senior management at the company being fired, while at least some 30,000 jobs were cut among billions of rupees lost.

“This scandal that rocked Volkswagen was a complete shock to everyone, obviously including us in Sri Lanka. Apparently Senok Automobiles who had signed for Volkswagen had attempted to save the agreement and continue with the investment as planned. However, at one point, I believe after much negotiations the Government had decided it would be better not to go with a dedicated Volkswagen assembly plant due to possible legal issues that could crop up due to the massive fallout from their emissions scam. This we knew today when the Prime Minister explained the sequence of events to us,” Silva said in his post.

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