Volkswagen announces five priorities to fix Dieselgate problem – will this help?

Volkswagen Group CEO Matthias Müller announced today five steps that Volkswagen will take to rehabilitate itself from the Dieselgate scandal.  In reading through the proposal, I don’t quite grok how it’s going to fix the problem.  There are some aspects which may help, but nothing in this indicates that upper management will take any personal responsibility for Dieselgate.  I’m on record pointing out that VW Groups upper management is insisting they had no responsibility for Dieselgate, and instead they claim it was mid-level employees acting on their own, but to me that makes no sense.

What happened with Dieselgate?  The result was that Volkswagen, Audi, etc TDI Diesel vehicles fraudulently emitted way more NOx air pollution than allowed by law.  But why did that happen?

As I’ve noted before, the VW Group official statements have said the problem was created by a small number of individuals who programmed emissions control software to commit fraud.  I believe this cannot be true, and that some decision making had to happen at higher levels of management if only because the fraud affected so many VW/Audi/etc models over several model years.

The five points include nice appropriate statements — changing the culture — finding the truth — etc.  So far the management has denied responsibility while pointing fingers at mid-level people, so I wonder how truthful they will allow the process to be?

Deutsche-Welle reported today on Volkswagen’s quarterly results, noting the report describes Dieselgate as “the diesel issue” as if the PR department is trying to downplay the crisis.  According to DW, CEO Matthias Müller had been using words like “emissions scandal,” and “crisis,” and “problems.”  When the quarterly financial report instead says “diesel issue” that’s a 180-degree U-turn back to an Orwellian style attempt to rewrite history.

We won’t know for sure for awhile – just want to raise the possibility that this find sounding statement of purpose might be empty.

 

MATTHIAS MÜLLER UNVEILS NEXT STEPS FOR THE VOLKSWAGEN GROUP

  • Support for customers top priority
  • Volkswagen looks beyond current crisis
  • New strategy to be unveiled in 2016

Matthias Müller, Chairman of the Board of Management of Volkswagen Aktiengesellschaft, has announced the five key steps to realign the Group. “We have to look beyond the current situation and create the conditions for Volkswagen’s successful further development”, said Müller in Wolfsburg on Wednesday. He presented a five point plan that he intends to use so that Volkswagen remains one of the world’s leading automobile manufacturers in the future. Müller is confident that “Volkswagen will emerge from the current situation stronger than before”. He announced that the cornerstones of the Group’s Strategy 2025 will be presented next year.

The Volkswagen CEO explained that his top priority is to support the customers affected by the diesel issue. “Our customers are at the core of everything that our 600,000 employees worldwide do”, he said. According to Müller, Volkswagen is working intensively to develop effective technical solutions. In contact with the Kraftfahrtbundesamt (KBA – German Federal Motor Transport Authority) the implementation is set to begin in January 2016.

Müller’s second priority is to systematically drive forward and complete the investigation into what happened. “We must uncover the truth and learn from it”, he said, adding that Volkswagen is being extremely thorough in its analysis. For this purpose, audit firm Deloitte has been engaged in addition to the steps already announced. According to Müller, those responsible for what has happened must face severe consequences.

Müller’s third priority is to introduce new structures in the Volkswagen Group. “The key point is that Group management will be decentralized to a greater extent in the future”, he said, with more independence for the brands and regions. Müller stated that the Board of Management will focus on addressing cross-brand strategies, leveraging synergies and ensuring that Group resources are used effectively. “We will review in detail our current portfolio of more than 300 models and examine the contribution that each one makes to our earnings.”

As his fourth priority, Müller is driving forward a realignment of the Group’s culture and management behavior. He noted that the pursuit of perfection, the employees’ commitment and social responsibility in the Volkswagen Group must be retained. However, he believes that changes are necessary in how Volkswagen communicates and how it handles its mistakes. “We need a culture of openness and cooperation.” Müller also called on everybody at Volkswagen to display more courage, greater creativity and a more entrepreneurial spirit in their dealings with one another.

The Volkswagen CEO announced that the fifth priority will be to transform the Group’s Strategy 2018 into a Strategy 2025. “Many people outside of Volkswagen, but also some of us, did not understand that our Strategy 2018 is about much more than production numbers. A lot of things were subordinated to the desire to be “Faster, Higher, Larger”, especially return on sales.” According to Müller, the point is not to sell 100,000 more or fewer vehicles than a major competitor. Instead, the real issue is qualitative growth. Müller announced that the cornerstones of the Group’s Strategy 2025 will be developed over the coming months, and that it would be unveiled mid-way through next year.

 

About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.
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About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.

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