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    DieselGate GROUP2

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    Mounika M
    Volkswagen is facing a major scandal after it was discovered that their diesel vehicles contain "defeat devices" that allow the cars to pass emissions tests but emit 40 times the legal limit of nitrogen oxide during normal driving. The company is developing strategies to address the issue, including offering buybacks and replacing affected vehicles, donating profits to health causes, restructuring to improve transparency, and collaborating with regulators. They maintain their innocence and believe a competitor tampered with their software coding in an attempt to damage Volkswagen's reputation.

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    DieselGate GROUP2

    Uploaded by

    Mounika M
    26 views5 pages
    Volkswagen is facing a major scandal after it was discovered that their diesel vehicles contain "defeat devices" that allow the cars to pass emissions tests but emit 40 times the legal limit of nitrogen oxide during normal driving. The company is developing strategies to address the issue, including offering buybacks and replacing affected vehicles, donating profits to health causes, restructuring to improve transparency, and collaborating with regulators. They maintain their innocence and believe a competitor tampered with their software coding in an attempt to damage Volkswagen's reputation.

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    DieselGate_GROUP2 (1)

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    Volkswagen is facing a major scandal after it was discovered that their diesel vehicles contain "defeat devices" that allow the cars to pass emissions tests but emit 40 times the legal limit of nitrogen oxide during normal driving. The company is developing strategies to address the issue, including offering buybacks and replacing affected vehicles, donating profits to health causes, restructuring to improve transparency, and collaborating with regulators. They maintain their innocence and believe a competitor tampered with their software coding in an attempt to damage Volkswagen's reputation.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    26 views5 pages

    DieselGate GROUP2

    Uploaded by

    Mounika M
    Volkswagen is facing a major scandal after it was discovered that their diesel vehicles contain "defeat devices" that allow the cars to pass emissions tests but emit 40 times the legal limit of nitrogen oxide during normal driving. The company is developing strategies to address the issue, including offering buybacks and replacing affected vehicles, donating profits to health causes, restructuring to improve transparency, and collaborating with regulators. They maintain their innocence and believe a competitor tampered with their software coding in an attempt to damage Volkswagen's reputation.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 5

    DIESELGATE

    Group - 2
    Contents

    Case Summary ................................................................................................................................ 1


    Defence Strategy ............................................................................................................................. 1
    Revival Strategy .............................................................................................................................. 2
    Press Release ................................................................................................................................... 3
    Case Summary
    Volkswagen, a leading automobile brand worldwide is caught in “Diesel Scandal”.
    Volkswagen’s cars have defeat devices which helps to differentiate from the two operating
    modes. The other mode of this car is resulting in heavy nitrogen oxide emissions, which is 40
    times than that of the federal limit. This scam is now in the open and Volkswagen in facing
    international backlash. The company image and prices are both suffering because of this.

    Defence Strategy
    1. Unethical practices by the competitor
    Volkswagen’s closest competitor in this market has been Honda. Honda had secretly
    bribed the employees, which consisted of software engineers and supervisory board to
    take part in this emission scandal in order to stain the name of Volkswagen and bring
    down its public image and crash its stock prices.

    2. Internal enquiry and firing of employees directly involved in the scandal


    A thorough internal enquiry was conducted, and it was found out that approximately 50
    employees of the company were aware of this scandal and its happenings. 9 out of them
    were directly involved in the scandal. A case was filed against these 9 employees and
    were fired from the firm immediately.

    3. Software coding tampering


    The coding which goes behind the vehicle of Volkswagen has been tampered with by
    the company’s software engineer. The software engineer responsible for this had been
    bribed by Honda. This code tampering was difficult to track by the other software
    engineers as the coding goes into thousands of lines. This resulted in the emissions of
    the car being much higher that the acceptable rate by EPA. Since Honda had also bribed
    the supervisory board, this model was approved for production on large scale. Honda
    had then later tipped this information to other sources in order to bring this issue into
    the eyes of the EPA and the government. There is also concrete evidence on a senior
    manager at Honda reaching out to one of our employees Aaron Smith over mail, talking
    about tampering the codes. (Creative 3)

    1
    Revival Strategy
    1. Replacement Scheme
    Volkswagen promises to compensate its customers by giving them a fair replacement
    of all the cars bought between the 2009 – 2015 (17th September 2015) time period.
    Customers will be given two choices. They can sell their cars to Volkswagen and will
    receive a fair price depending on the model, age, trim etc. They can also take their cars
    to the nearest Volkswagen stores and give us their cars for two weeks within which
    we’ll rewrite the computer codes and install the correct software so that the AdBlue
    functions aptly.

    2. New SRP Initiatives


    Due to the increased levels of the toxic emissions, Volkswagen has decided to donate
    5% of its annual profits to people suffering from respiratory diseases. As a socially
    responsible company, Volkswagen also plans to plant and maintain 1,00,000 plants
    annually and continue to do so in all the coming years of the company. These initiative
    details will be posted on its social media pages and its official website page in order to
    make sure it is reaching out to a large audience. (Creative 1 and 2)

    3. Restructuring the Organization


    Volkswagen plans to change its vertical hierarchy and adapt to the modern horizontal
    hierarchy structure. A junior employee tried to report the scandal but was unable due to
    the hierarchy. The human resources also plan to set up a website where any employee
    can leave their feedbacks and place grievances or complaints anonymously. The
    website has already received many feedbacks under the blog column. (Creative 4)

    4. Collaborate with EPAs and Government Organisation


    Volkswagen has decided to meet up with the Environmental Protection Agencies and
    concerned Government Authorities to clear up the entire scandal. We also plan to set
    up a body which in collaboration with an environment protection agency will conduct
    surprise checks in the organisation.

    2
    Press Release

    For Immediate Release

    25th September 2015

    “The people’s car and company”

    Volkswagen is one of the most trusted automobile brands in the world. Volkswagen is also the
    world’s largest car maker by worldwide sales. Volkswagen Groupe sells its vehicles in 153
    countries across the world. Volkswagen compromises of two words which collectively means
    people’s car, as customer safety and satisfaction are the topmost priorities of this company.

    We are aware of how our vehicles are exceeding the emission levels specified by the EPA.
    Upon thorough investigation it was found out that it was found out that one of our competitors
    had bribed some of the employees of our company to tarnish the reputation of the firm. It was
    also found out that there was tampering with our software coding, which was resulting in excess
    of emissions. We understand the gravity of the situation and are working on buyback and
    replacement schemes for the vehicles produced within the time frame of the tampered coding.

    We are aware of how stock price is dipping because of this tragic incident. However, we at this
    firm have the skills and determination to make sure the stock prices are retained back to its
    normal at the earliest, and then skyrocket to new heights. As a highly progressive company we
    use effective strategies to achieve the best outcome. Our results are based on experience,
    market insight and sheer hard work. We ensure to the stakeholders, that we will be soaring at
    new heights.

    For further details, please contact:

    Aaryan Bihani

    PRO, Volkswagen Groupe

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