DETROIT—The latest dispatches from the Volkswagen diesel scandal would be shocking, if we hadn’t already lost our capacity to be shocked. Apparently having learned nothing from Toyota’s bad experience attempting to stonewall its way through a crisis, the German company continues to dig itself a deeper hole. It doesn’t have to be this way, and the way forward lies in the company’s own lineup.
In the latest development, attorneys general from around the U.S., fighting for their diesel-owning constituents, are attacking VW for its latest and somewhat bizarre legal tactic — fighting U.S. investigations by citing German privacy law. This stalling tactic comes despite repeated assurances from VW chief executive Matthias Muller that the company is offering “maximum transparency” as it works to “win back trust.”
VW Golf TDIs like this one are far more common in Europe, where diesel rules. But we have 482,000 four-cylinder TDI owners who demand relief. (Photo: Karlis Dambrans/flickr)
“I find it frustrating,” said Attorney General George Jepsen of Connecticut, “that, despite public statements professing cooperation and an expressed desire to resolve the various investigations that it faces following its calculated deception, Volkswagen is in fact resisting cooperation by citing German law.”
Germany does indeed have strict privacy laws (it’s a plot point on "Homeland," believe it or not), but this scandal was uncovered in the U.S., and the state lawyers are investigating on behalf of hapless American diesel owners.
VW is withholding emails between its executives, but it’s a desperate gambit — those heads are eventually going to roll, if they haven’t already. Nine execs have been suspended so far, but none of them were members of the management board that actually runs the company.
An often-cited case is instructive to VW: When Johnson & Johnson faced a crisis in 1982 when somebody poisoned its popular Tylenol product with cyanide in six or more pharmacies in the Chicago area, resulting in seven horrible deaths.
J&J;, with a strong internal ethics code, acted immediately — even before its then-chairman, James Burke (who was on a plane), knew what had happened. The public was told not to consume Tylenol, production stopped, and the drug was pulled from shelves across the country.
“By withdrawing all Tylenol, even though there was little chance of discovering more cyanide laced tablets; Johnson & Johnson showed that they were not willing to take a risk with the public's safety, even if it cost the company millions of dollars,” says a Department of Defense crisis communications case study. “The end result was the public viewing Tylenol as the unfortunate victim of a malicious crime
When faced with a crisis of confidence, Johnson & Johnson acted fast to regain the public trust. Within days, Tylenol was off shelves nationwide. (Photo: Mike Mozart/flickr)
The New York Times ran an interesting op-ed pointing a way forward for VW. According to two Johns Hopkins professors, Volkswagen “should stop sending us apologies—and should start replacing thousands of old school buses across the country.”
As a former school bus driver myself, I well know that the yellow kidmobiles belch far too much diesel smoke, and it’s a health hazard. As the profs point out, the buses “emit a toxic mix of gases, including the nitrogen oxides associated with asthma, exacerbations of lung disease, and premature death.”
Since VW is facing $20 billion in federal fines under the Clean Air Act, diverting at least some of the money into replacing buses in cash-strapped school districts is a great, innovative idea. But it’s precisely the kind of thing that governments never actually do. Don’t hold your breath on this one.
As I said, though, a solution lies in VW’s own lineup. Disgruntled diesel owners are unlikely to be happy with fixes that downgrade both the fuel economy and performance of their cars. I say give them steep discounts on a brilliant new VW, the Jetta 1.4T.
I’ve written about how manufacturers are using turbocharging on small engines to get a twofer of performance and fuel economy. A 1.4-liter four (replacing a 115-horsepower two-liter nicknamed “too point slow”) is certainly tiny, but it delivers 150 horsepower in this configuration, which is coupled to a six-speed automatic. And who can argue with a car (list price $21,235) that Consumer Reports describes as possibly “the most satisfying of all the small turbos on the market,” offering 47 mpg on the highway and 32 mpg overall. The much pokier diesel offer 36 mpg overall, but it got there only by cheating.
The Jetta 1.4T is playing honestly. The diesel owners would love the chance to grab its keys, and the VW brand (now actually transparent, instead of just saying it is) could start to rebuild its devastated reputation.