PARIS—Shares of French carmaker Renault plunged over 10% on Thursday as environmental officials revealed its diesel engines exceed emissions limits, although unlike the VW scandal, no cheating software had been found in the cars.
France's Environment Minister Segolene Royal made the announcement after a commission she appointed submitted test results of French and foreign vehicles. The tests found carbon dioxide and nitrogen dioxide emissions in Renault cars to be too high, as were those of several non-French automakers that were not identified.
Renault's stock closed down 10.28% at 77.75 euros after sinking by as much as 20% throughout the trading day in Paris after unions first reported that anti-fraud detectives had raided sites of the carmaker possibly in connection with the emissions probe.
"The news triggered a massive selling movement, it's a disaster that's pulling everybody down," said one Paris-based analyst, referring to falling auto stocks across Europe.
Suspicions of possible foul play raised fears that an ongoing Volkswagen pollution scandal was spreading to neighboring France. The German carmarker has admitted that 11 million of its diesel engine vehicles worldwide were fitted with pollution cheating devices.
But no such devices were found on the Renault vehicles and French Economy Minister Emmanuel Macron, on a visit to Berlin was quick to note that Renault was "not in any way a comparable situation" to that of troubled VW.
Both Macron and Royal expressed confidence in the French carmaker, in which the state holds a 19.7% stake.
Unions Report Raids
Early Thursday, unions reported that French anti-fraud detectives had last week raided Renault facilities.
"Agents from the (anti-fraud unit) DGCCRF intervened in various Renault sites last Thursday," the CGT Renault union said in a statement.
The probe targeted the sites' engine control units which suggested, the union said, that the raids "are linked to the consequences of the Volkswagen rigged-engines affair".
Detectives took several personal computers belonging to Renault managers, the unions said.
Royal however said later Thursday that "the searches (at Renault) had nothing to do" with the tests related to the VW scandal.
Renault had played down the raids, saying they were part of a probe by the DGCCRF aimed "to confirm definitively the initial analysis conducted" at the behest of Royal and which had "not shown evidence of illegal cheating software on Renault vehicles."
Shares in Peugeot, France's biggest carmaker, fell 5.05%, although it released a statement Thursday saying it had not been the target of any anti-fraud raids. It add that similar government tests had resulted in the "absence of any anomaly" in car emissions.
Renault and Peugeot have invested heavily in diesels, and the engines account for over half of their sales in France, so the two companies have much to lose from any shift away from the technology over environmental concerns.
The Renault news weighed on auto stocks across Europe, with BMW, Daimler and Volkswagen all losing more than three percent at the close of trading in Frankfurt.
Volkswagen is facing possible fines that could reach into the tens of billions of dollars in the United States alone over the scandal, and faces probes in other countries as well.
Diesel engines can be more fuel efficient and produce less carbon dioxide, a key pollutant in global warming.
But they produce more nitrous oxide, another pollutant, and carmakers have invested huge sums to make diesel engines cleaner.
Software on the Volkswagen engines reduced nitrous oxide emissions when vehicles underwent testing, but allowed them to pollute while on the road.
Fiat Chrysler shares, meanwhile, crashed after a report saying the company has been accused of conspiring to inflate its US sales figures.
The company said the claims were unfounded, but its shares tumbled 7.9% in Milan and were down 5.5% in midday trading in New York.
Copyright Agence France-Presse, 2016
