To further analyze whether the news about Volkswagen is a shock to the entire car manufacturing industry in general or just a shock to Volkswagen that spilled over to specific firms, we investigate whether these effects differ for certain subsamples of competitors and suppliers. The literature on spillover effects demonstrates that the extent of the shock is related to similarities between the event firm and non-event firms, as outlined in Eckert ( 2019 ). In this respect, geographical proximity is often used to proxy for such similarities (e.g., Aharony and Swary 1996 ; Docking et al. 1997 ; Adams et al. 2015 ). To test if spillover effects are different for competitors who are more similar to Volkswagen, we distinguish between European (high proximity) and non-European competitors (low proximity). We further subdivide the non-European sample into Japanese, U.S., and other competitors, since effects might apply differently to certain regions grouped together as non-European.