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In 2016, Volkswagen Aims To Repair Its Reputation After Emissions Scandal


Now let's talk about a company managing bad news. Volkswagen ends the year struggling to recover after admitting it cheated on emissions tests. NPR's Sonari Glinton reports.

SONARI GLINTON, BYLINE: The story of the VW diesel emissions scandal began in a very unexpected place. Arvind Thiruvengadam is a research professor at West Virginia University.

ARVIND THIRUVENGADAM: Our part in this entire episode is very small because, you know, when we went into the study, our aim of the study was never to catch a manufacturer.

GLINTON: They did catch a manufacturer. Thiruvengadam and his colleagues were doing real-world testing of diesel vehicles. Volkswagen for years had installed software that allowed its diesel cars to operate as clean when regulators were testing them for pollutants and then switch to dirty when no one was looking.

THIRUVENGADAM: I remember asking my colleague, are you sure we're doing things right? Because you said things were really low on the chassis, but we don't see the same trend on the road. And that's when we were looking at each other and like, OK, let's look at, you know, did we make any mistakes.

GLINTON: Turns out, there had been no mistakes. Volkswagen had marketed and sold vehicles as clean diesels. Not only were they not clean; the vehicles polluted nearly 40 times more than the company said they did. Instead of having clean diesels parked in their driveways, hundreds of thousands of VW owners had cars that were polluting like they were 18-wheel trucks. And the company admitted as much. Here's VW's U.S. head, Michael Horn, speaking at a party after the news broke.


MICHAEL HORN: Our company was dishonest with the EPA and the California Air Resources Board and with all of you. And in my German words, we have totally screwed up.

GLINTON: That's barely the half of it. Volkswagen's CEO in Germany was forced to resign. Its stock price took a hit, and regulators and law enforcement agencies launched investigations on multiple continents.

JAKE FISHER: So it was really a very strong company that looked to be on a - on a trend. But no one wants to buy a car from a company that's going to lie to you.

GLINTON: Jake Fisher of Consumer Reports says it's not just customers who have doubts.

FISHER: We have doubts on whether or not they're going to continue to get the good fuel economy that they get. We have doubts whether or not they're going to drive as nicely. Will they be slower? Will there be other problems? Obviously, they made the decision for a reason.

GLINTON: Volkswagen has admitted to lying and cheating. And it has apologized. In a statement for this story, a company spokeswoman writes, quote, "we want to assure customers and owners of these models that their automobiles are safe to drive. And we are working to develop a remedy that will meet the expectations of the government agencies," unquote. Here's a question being asked both at Volkswagen and about Volkswagen. Is this scandal posing an existential threat to one of the most important companies in the history of cars? Akshay Anand with Kelley Blue Book has an answer.

FISHER: Around 80 or 90 percent of consumers say they're willing to forgive Volkswagen if they take the right steps.

GLINTON: Volkswagen executives haven't exactly said how they'll fix the polluting cars. But they have offered aggrieved customers discounts, gift cards and other incentives. Anand says the company needs to do more than repair its reputation.

AKSHAY ANAND: Any way you look at it, this is going to be billions and billions and billions of dollars or euros. Consumers are willing to forgive in time. It's just, how long will the financial impact last?

GLINTON: Anand says while the rest of the industry enjoys record sales and is innovating and hunkering down for the next recession, Volkswagen is likely to be trying to fix its self-inflicted wound. Sonari Glinton, NPR News. Transcript provided by NPR, Copyright NPR.

Sonari Glinton is a NPR Business Desk Correspondent based at our NPR West bureau. He covers the auto industry, consumer goods, and consumer behavior, as well as marketing and advertising for NPR and Planet Money.
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