Marketing Bootcamp

Volkswagen Faces the Most Onerous Rebranding Challenge In History, Again

My betrothed, The Vegan, until recently the contented owner of a diesel 2010 VW Golf TDI, received via snail mail an ersatz apology from VW for the fact that the quick, sporty car she was feeling all small-carbon-footprint smug about driving is, under U.S. law, a crime against nature. The letter appeared to have been personally signed by Michael Horn, VW president and CEO for North America, but who can tell? They're Volkswagen. You know they can counterfeit the guy's signature and we'd be fooled.

The artful wording of the letter proves that whatever other governance problems dog VW, they have removed the silos separating the legal department from corporate communications. You need that level of teamwork to apologize in writing without admitting anything an ambitious prosecutor or class action attorney will ask about later. Herr Horn wanted The Vegan to know that the government "had determined'' the car that soon will be community property "[does] not comply with emissions standards.''

Except during emissions inspections, exactly as it was designed. I added that part.

Related: What Volkswagen Can Teach You About Values-Based Marketing

Ironic coincidence about the uncovering of VW's emission ruse: It was largely the work of a guy named John German of the International Council on Clean Transportation who was trying to prove the cars really are "clean diesel.'' He was disappointed to find out the cars pass emissions tests like a forest breeze but in actual driving emissions are anywhere from five to 35 times more than legal. Which really surprised German, though not the Germans.

“We were astounded when we saw the numbers,” he told the Guardian.

How much trouble is VW in? Let us assess. If this were an ordinary corporate gunshot to the foot you might conclude the two worst signs are the nose dive in VW's stock price and that, when Googling "VW diesel,'' ads inviting participation in class-action lawsuits crowd the screen like flies. Ephemeral stock prices and mass litigation are lesser worries for the German carmaker given the recent chest thumping of the Department of Justice to put even crooks wearing wingtips into prison. There is a real possibility that not all the handcuffs will be golden for the VW executive team.

There are 11 million Volkswagens with those "defeat devices'' hoodwinking emission inspectors worldwide, so there are lots of places where the authorities are taking this personally. The company is recalling 8.5 million cars in Europe, where the envirocrats didn't know what was going on until they heard about what had been uncovered in the USA (sometimes we are still number 1). There is no recall plan for the 482,000 pollutmobiles here in the U.S., where the emission standards are the toughest in the world, because what fixes the cars in Europe is still too broken for us. California has its own standards even tougher than the rest of the country.

Related: What We Can Learn From Volkswagen's Scandal and the Legacy of a Leader

According to Mike's letter from VW, they are "working hard on remedies to bring vehicles into emissions compliance as soon as possible.'' Don't hold your breath waiting for that "remedy,'' unless you're near the tailpipe of a diesel VW. If those clever German engineers could have built a diesel car that passed inspections with the same zip and gas mileage, they would have in the first place.

It does seem those autobahn-crazed Germans really do put driving fast above other considerations, such as market collapse, disgrace and prison. Mike mentioned in his testimony before Congress that whatever it takes to fix the emissions will only reduce top speed of The Vegan's Golf TDI by one or two miles per hour from the 125 mph top-rated speed. We slow poke Americans would have settled for 123 mph without being asphyxiated but they don't compromise on performance in Germany.

This is not your run-of-the-mill auto industry fiasco we are all familiar with. What car maker has not been forgiven for a lethal-but-unintentional flaw they couldn't quite cover up? "You know, you're right, we accidentally built cars that every so often kill or maim somebody. We were hoping it wouldn't happen any more and we wouldn't have to cop to it, but now that it's out, we'll fix the cars and write everybody a check.''

Whatever, just let us resume vaping that new car smell, because after all they didn't design the cars to catch fire or accelerate like a dragster when Aunt Betty is prowling the mall parking lot. VW is more like a spouse caught flagrante delicto. There is no claiming mistakes were made, which is why that nice Mr. Horn offered The Vegan his "personal and profound apology'' and a soothing reminder that the EPA said the car "remains'' legal for her to drive. It's a relief to know that even though it was illegal for VW to sell her the car, it's legal for her to own it. For now.

Unless a global criminal conspiracy is part of your business plan there isn't much of a lesson from VW's woes, so far, but watch and learn from how they rebrand over the long term. Sure, it's awkward to mention but this is the car company basically founded by Hitler and they managed to put that behind them without even changing their name. Presuming they manage to stay in business, VW will be forgiven when it resumes, or at least starts, selling cars as sporty, thrifty and legal as their diesels pretended to be.

Related: Watch Out Tesla, Here Comes Volkswagen

Edition: October 2016

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