The Storm Over Volkswagen

Rebuilding trust won't be easy.

The story of Johnson & Johnson's 1992 recall of Extra-Strength Tylenol has been written up in many journals as a textbook example of effective crisis management. We're now witnessing how much the managers of Volkswagen AG learned from that case study.

I've never owned or driven a Volkswagen, nor have I been a stockholder of the company. Writing this editor's note in mid-September 2015, I'm happy not to be driving one of their four-cylinder diesel vehicles (one with a Type EA 189 engine, that is) because the storm that broke over the automaker in September would have me quite upset with the company and wondering whether it will survive.

EPA issued a notice of violation of the Clean Air Act to Volkswagen AG, Audi AG, and Volkswagen Group of America, Inc., and California separately issued an In-Use Compliance letter, with both agencies alleging that four-cylinder Volkswagen and Audi diesel cars from model years 2009-2015 include "defeat device" software that evades EPA emissions standards for certain air pollutants. On Sept. 22, Volkswagen AG admitted the software is in "some eleven million vehicles worldwide." EPA and CARB opened investigations, raising the possibility of significant fines; VW's statement disclosed it had set aside $7.2 billion to address the issue.

Volkswagen said it "is working at full speed to clarify irregularities concerning a particular software used in diesel engines." While new vehicles with EU 6 diesel engines currently available in the European Union comply with legal requirements and environmental standards, the company said that "[a] noticeable deviation between bench test results and actual road use was established solely for [the Type EA 189] engine. Volkswagen is working intensely to eliminate these deviations through technical measures. The company is therefore in contact with the relevant authorities and the German Federal Motor Transport Authority. . . . Volkswagen does not tolerate any kind of violation of laws whatsoever. It is and remains the top priority of the Board of Management to win back lost trust and to avert damage to our customers. The Group will inform the public on the further progress of the investigations constantly and transparently."

Rebuilding trust won't be easy. "Using a defeat device in cars to evade clean air standards is illegal and a threat to public health. EPA will continue to investigate these very serious matters," Cynthia Giles, assistant administrator of EPA’s Office of Enforcement and Compliance Assurance, said when EPA announced the enforcement action.

This article originally appeared in the November 2015 issue of Occupational Health & Safety.

About the Author

Jerry Laws is Editor of Occupational Health & Safety magazine, which is owned by 1105 Media Inc.

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