Volkswagen: From Near-Fatal Crash to No.1

Volkswagen: From Near-Fatal Crash to No.1

Once maligned for cheating on its emission tests, Volkswagen has reemerged as the largest car seller in the world.

Boosted by strong, global sales, the company has recovered financially and is poised to become a major player in the electric vehicle (EV) market. A mix of lucky breaks, deals with the unions, and a strategic focus supported by substantial investments has enabled Volkswagen to manage a current crisis while keeping the company oriented toward a bright future.

This post is based on the Bloomberg article, How Volkswagen Walked Away From a Near-Fatal Crash, by M. Campbell, C. Rauwald, and C. Reiter, March 28, 2018. Image source: flippo/123RF.

Discussion Questions:

1. What are the reasons for Volkswagen’s lingering reputation problem?

Guidance: Discuss Volkswagen’s breach of ethics which eroded consumers’ trust. Also mention the bad PR surrounding the issue: former CEO’s awkward response as well as new CEO’s lavish lifestyle and characterization of the fraud as a “technical problem.” The press reports on ongoing lawsuits, investigations, and site inspections also contribute to keeping the scandal alive in consumers’ minds.

2. As Volkswagen is trying to reinvent itself, it is adhering to a core strategy while expanding its scope. How? Continue reading