Analysis of Volkswagen's Emission Scandal: Strategic Implications

This report provides an in-depth analysis of the Volkswagen emission scandal, also known as Dieselgate. It examines the factors that led to the cheating, including the Clean Air Act, laboratory testing, and the company's intention to avoid investments in emission control mechanisms. The report details the consequences of the scandal, such as criminal charges, reputational damage, monetary fines, and loss of brand value. It explores the long- and short-term implications, including personnel changes, stock price drops, and penalties. Furthermore, the analysis covers the implications on strategy and governance, emphasizing ethical strategies and awareness of greenwashing. Risk management and modifications are also discussed, highlighting brand management, integrated marketing communication, and the need for real-time emission testing. The report concludes with a bibliography of the sources used for the analysis.

VOLKSWAGEN EMISSION GATE
AN IN DEPTH ANALYSIS
NAME OF THE STUDENT
ORDER ID
NAME OF THE UNIVERSITY

Factors responsible for cheating:
 Clean air act and the strict
implementation of the legislation from
the part of united states environmental
protection agency (Fortune.Com, 2019).
 Laboratory testing of the NOx values of
the emission of the products.
 The intention of the company in avoiding
the significant investment in managing
the incorporation of control mechanism
for ethically limiting the emission of the
products of the company.

Results of the cheating and the impact:
 The criminal charges on the
mentioned company.
 Reputational damage.
 Monetary fines.
 Loosing the brand a bit.
 Loosing the loyal customers of the
organization.

Long and short term implications of the case:
 A series of sacking and suspensions took place inside the organization which included
the head of brand development, Heinz-jakob Neusser, Audi research and development
head, Ulrich Hackenberg and Porsche research and development head, Wolfgang Hatz.
 The CEO martin Winterkorn resigned from his position as a result of the case (Just-
auto.Com, 2019).
 Significant fall in the stock prices of the company along with the plans of US$18.32
billion for the necessary adjustments in the faulty products of the mentioned
organization (Independent.co.uk, 2019).
 The penalty of US$2.8 billion for the intentional rigging of the diesel powered vehicles
in order to unethically avoid the government emission tests (Phys.Org, 2019).

Implications of the case on the strategy and governance:
 With the idea of the consequences of the
case, the management of the mentioned
organization will make sure that they
formulate their strategies in an ethical
manner and competes with the other
organizations in the right spirits.
 The governance of the organization is
expected to be aware of the impact of
the green washing and the whitewashing
lies (Di rattalma, 2017).

Risk management and modifications:
 The case provides the perfect lesson to the organization in managing their brand
and along with that, it also enables the organization to be aware of the
techniques for the effective management of the financial risk that is associated
with the reputational damage that the mentioned organization was facing.
 The initiation of the effective integrated marketing communication from the part
of the mentioned organization will be crucial for the organization in the effective
management of the reputational crisis.
 The concerned authority responsible for conducting the environmental tests and
for the design of the business and environmental law, is in need to make sure
that they be able to test the emission of the vehicles in the real time scenarios.

References
DI RATTALMA, M. F. (ED.). (2017). THE DIESELGATE: A LEGAL PERSPECTIVE. SPRINGER.
FORTUNE.COM (2019). HOW VW PAID $25 BILLION FOR 'DIESELGATE' — AND GOT OFF EASY. [ONLINE]. AVAILABLE
AT:HTTP://FORTUNE.COM/2018/02/06/VOLKSWAGEN-VW-EMISSIONS-SCANDAL-PENALTIES/
INDEPENDENT.CO.UK (2019). VOLKSWAGEN EMISSIONS SCANDAL [ONLINE]. AVAILABLE AT:
HTTPS://WWW.INDEPENDENT.CO.UK/TOPIC/VOLKSWAGEN-EMISSIONS-SCANDAL?CMP=ILC-REFRESH
JUST-AUTO.COM (2019). FORMER VW CEO CHARGED WITH FOUR OTHERS OVER 'DIESELGATE'. [ONLINE]. AVAILABLE AT:
HTTPS://WWW.JUST-AUTO.COM/HOT-ISSUES/VOLKSWAGENS-EMISSIONS-CRISIS_ID548.ASPX
PHYS.ORG (2019). VW HID 'DEVASTATING' RESULT FROM DIESEL EXHAUST TESTS ON MONKEYS. [ONLINE]. AVAILABLE AT:
HTTPS://PHYS.ORG/NEWS/2018-01-VW-HID-DEVASTATING-RESULT-DIESEL.HTML

Bibliography
CLEANENERGYWIRE.ORG (2019). "DIESELGATE" - A TIMELINE OF GERMANY'S CAR EMISSIONS FRAUD SCANDAL. [ONLINE]. AVAILABLE AT:
HTTPS://WWW.CLEANENERGYWIRE.ORG/FACTSHEETS/DIESELGATE-TIMELINE-GERMANYS-CAR-EMISSIONS-FRAUD-SCANDAL
DAILYMAIL.CO.UK (2019). THE DEADLY DIESEL DECEPTION: WE WERE BULLIED INTO BUYING DIESEL CAR. [ONLINE]. AVAILABLE
AT:HTTPS://WWW.DAILYMAIL.CO.UK/DEBATE/ARTICLE-2617425/THE-DEADLY-DIESEL-DECEPTION-WE-BULLIED-BUYING-DIESEL-
CARS-HELP-FIGHT-GLOBAL-WARMING-NOW-EXPERTS-SAY-GREEN-FUEL-KILLING-THOUSANDS-US.HTML
DI RATTALMA, M. F. (ED.). (2017). THE DIESELGATE: A LEGAL PERSPECTIVE. SPRINGER.
DRIVESPARK.COM (2019). STUDY REVEALS NEW DIESEL CARS ARE BETTER FOR ENVIRONMENT. [ONLINE]. AVAILABLE AT:
HTTPS://WWW.DRIVESPARK.COM/FOUR-WHEELERS/2017/NEW-DIESEL-CARS-BETTER-FOR-ENVIRONMENT-STUDY-023044.HTML
LEXOLOGY.COM (2019). EMISSIONS TESTING: FRAUD AND THE DANGERS OF CARTELS. [ONLINE]. AVAILABLE AT:
HTTPS://WWW.LEXOLOGY.COM/LIBRARY/DETAIL.ASPX?G=28597A08-B695-4ADF-9349-AECF9599A054
THEGUARDIAN.COM (2019). OLIVER SCHMIDT JAILED FOR SEVEN YEARS FOR VOLKSWAGEN EMISSIONS SCAM. [ONLINE]. AVAILABLE AT:
HTTPS://WWW.THEGUARDIAN.COM/BUSINESS/2017/DEC/06/OLIVER-SCHMIDT-JAILED-VOLKSWAGEN-EMISSIONS-SCAM-SEVEN-
YEARS