It has recently come to public attention that Volkswagen, a car manufacturer known worldwide, has been cheating the system. They outfitted many of their diesel cars with devices designed to pass government emissions standards, while knowing their cars should not be passing these tests. It also appears that this was no mistake and Volkswagen was explicitly cheating. These allegations are serious and if upheld, should be extremely detrimental to the company.
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Simply from a financial prospective, they could face up to 18 billion dollars in fines but that may not even be the most detrimental loss. Brand reputation is going to be hurt badly and for a consumer’s prospective, they may start to question if Volkswagen products can be trusted. Shares have already taken a downturn, falling 18% in the wake of the scandal.
It seems Volkswagen expended too much effort in to developing technology that could detect when it was being emissions tested and skew results, rather than finding a way to just reduce the emissions. The effects of this scandal aren’t only going to be felt at Volkswagen however, as independent auto dealers and car owners will have trouble selling these cars. It is a shame that a once reputable auto manufacturer chose such a lazy approach to their emissions problem, as there are countless people affected by this; from shareholder, to retailor and consumer, and the general public as well.
References
http://www.bbc.com/news/business-34311819
http://www.usatoday.com/videos/news/nation/2015/09/26/72878852/
Media Sources
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