Analysis of the Volkswagen Emissions Scandal in Mechanical Engineering

This report examines the Volkswagen emissions scandal, which began in 2015 when the EPA discovered that the company had been using "defeat devices" in its TDI (Turbo Direct Injection) engines to cheat on emissions tests. The scandal involved approximately 11 million vehicles worldwide. The report details the implementation of these devices, the resulting increase in NOx emissions, and the subsequent regulatory investigations and financial repercussions. The analysis includes the impact on the company's stock price, the resignation of key executives, and the company's efforts to fix the affected vehicles. Furthermore, the report explores potential future actions for Volkswagen, including re-branding and restructuring to regain public trust. The report concludes by emphasizing the importance of ethical practices and independent verification within the automotive industry and highlights the need for the company to rebuild its credibility through various measures, including potentially selling off assets or issuing bonds to restore consumer confidence.

Running head: MECHANICAL ENGINEERING
Mechanical Engineering
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Topic: Volkswagen emissions scandal
Introduction
Scandal of Volkswagen emissions happened in 2015 in the month of September. The
EPA (Unites States Environmental Protection Agency) stated violation notice for Clean Air Act
to the German automaker in the Volkswagen group. EPA found out that the company introduced
TDI (Turbo Direct Injection) engines so that they could activate their control of emission in the
testing phase (Rhodes 2016). Introducing of TDI stated about emitting 40 times less NOx
compared to real driving. In total, the company implemented this TDI in about 11 million cars all
over worldwide. VW after implementing the TDI started a wide marketing campaign stating that
its new launched cars emits less emission. The below statistics shows the emission of nitrogen
oxide on road testing.
Figure 1: Average emission of NOx on road testing
(Source: Zhou 2016)
Repercussions

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After EPA found out the scam, Volkswagen was targeted for regulatory investigations in
many of the countries (Tse et al. 2017). In one of the German paper, this scandal was even stated
as “expensive stupidity act in the history of car industry”. The stock price of the company began
falling and finally the company admitted that this software was implemented in 11 million cars.
As a remedy, the company invested $7.3 billion to fix the cars so that they are capable to
complying the pollution standards. Presently company actually facing lawsuit of 3.3 billion euro
and can face criminal prosecutions. The shares of the company fell by more than 20 %. After this
scandal, the CEO and the US Executive of the company resigned.
Future Work
From over more than 60 years, Volkswagen was considered to be as global brand and for
this reason some of the researchers and analysts believe that this scandal will be soon forgotten
and there are others who are in discussion process to restart company again new brand name. Re-
branding company will make the easy to set up efficiency programs and will help to save
Volkswagen. The re-branding should not only focus on the exterior changes, but should focus on
all other aspects of the company.
Conclusions
The company of Volkswagen should include all the efforts as well as resources that will
help to re-establish the credibility within the company. It would be appropriate for the company
to re-brand and can join verification agencies independently which is comparatively feasible and
fair to accomplish. The company can also sell one of the brands as well as post the bond. This
option is an expensive one and help to restore the citizen’s faith in the company.

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References
Rhodes, C., 2016. Democratic business ethics: Volkswagen’s emissions scandal and the
disruption of corporate sovereignty. Organization Studies, 37(10), pp.1501-1518.
Tse, Y.K., Zhang, M., Doherty, B., Chappell, P., Moore, S.R. and Keefe, T., 2017. Exploring the
hidden pattern from tweets: Investigation into Volkswagen emissions scandal. In Supply Chain
Management in the Big Data Era (pp. 172-198). IGI Global.
Zhou, A., 2016. Analysis of the Volkswagen scandal possible solutions for recovery.