Revelations that motor giant Volkswagen fitted diesel cars with software that could manipulate the results of US emissions tests are set to prompt a global wave of litigation and possible criminal charges in Germany.

The company’s chief executive Martin Winterkorn last week stepped down over the scandal, which wiped 30% off the share price. Newspaper reports said that VW had set aside $6.5bn (£4.3bn) to handle the costs of the affair. It has retained US-based international commercial firm Kirkland & Ellis to handle litigation.

In the UK, national firm Slater and Gordon said that thousands of people and car dealerships who had bought cars whose value had plummeted since the revelations could have a group claim against Volkswagen and possibly other manufacturers. Shareholder fraud specialist Edwin Coe said that VW shareholders could also sue.

Environmental law group ClientEarth, which earlier this year secured a

landmark Supreme Court ruling on the UK government’s response to pollutants from diesel engines, has asked the Department for Transport to establish whether VW’s use of ‘defeat devices’ to cheat on emissions tests is part of wider industry practice.

James Thornton, chief executive of ClientEarth, said: ‘The industry has shown it cannot be trusted. We cannot wait for action from the EU. First responsibility for protecting our health lies with our own government. The public must know the full scale of the problem and urgent action must be taken to fix it. Flouting laws cannot be tolerated.’

In April this year, the Supreme Court noted in R (on the application of ClientEarth) v Secretary of State for the Environment, Food and Rural Affairs that the main reason for diesel pollution limits being exceeded ‘is that the real world emission performance of a vehicle has turned out to be quite different to how the vehicle performs on the regulatory test cycle’.