European auto stocks fall on UK dieselgate lawsuits

STORY: Shares in European car manufacturers dropped on Wednesday.

Investors are worried ahead of possible lawsuits in Britain over emissions tests.

They believe it could cost companies over $7.5 billion.

The claimants are owners of diesel vehicles.

On Tuesday, lawyers told London’s High Court some of the world’s biggest carmakers face 1.5 million lawsuits in Britain.

Spokespeople for Mercedes Benz and U.S. carmaker Ford said they saw “no merit” in the claims.

But the suits highlight the ongoing fallout from a scandal that erupted in 2015 over Volkswagen.

The German automaker admitted to using “defeat devices” to change the emissions levels of diesel vehicles during testing.

Wednesday’s stock drop was led by declines in major brands like Volkswagen and BMW.

Their shares were both down over 1%, and among the worst performers on Germany’s blue chip index.

The STOXX carmakers index fell as much as 1% in early trade.