VW was not the first one to be caught with this: http://www2.epa.gov/enforcement/caterpi ... settlement
That does not make them any less culpable.
If VW gets killed over this then the German economy goes to the dumps and the rest of Europe goes with it. Therefore it is likely that VW will continue as a going concern and some hideous horse deals will happen around this fiasco. The greatest beneficiaries will be the lawyers. Tax payers in Europe, share holders all over the globe, customers mostly in the US, and dealers mostly int he US will feel the hurt. (Would you like to trade in your Jetta Diesel? Good luck!-Would you like your Jetta Diesel detoxified and loose MPG and performance over it? No thanks! That's why it was bought in the first place.)
Some heads will roll. They will try to find a herd of scapegoats (one won't do) and Winterkorn will try to stay in charge. But it won't work. He and a bunch of big wigs will need to go.
Some think that Merkel will loose grip of power over this: she can't let VW go to the dumpster because she opened the doors wide for all these refugees. Now the US has a major bargaining chip to pressure Europe in to accepting Genetically Modified Organics, i.e. food stuff.