Critical Analysis Of Volkswagen Emissions Scandal

Violation

Back in 2008, the U.S. government placed a law that limited the number of nitrous oxide particles that would be emitted from diesel engines in cars that are sold in the country. Some manufactures decided to use the Urea injection technology in order to follow the procedures of producing less particles. When the former CEO Winterkorn took control of Volkswagen, he decided not to partner up with Daimler since they have already created the urea technology called “Blue Tec”. Volkswagen had to think of something similar to “Blue Tec” as soon as possible since the deadline was coming close. Therefore, Volkswagen decided to not take the same procedure since they claimed that their new Clean Diesel technology has already fixed the situation and has met with the regulations. As time went by, their market strategy was a success. More customers wanted to buy a Volkswagen since it had the new technology that would create less pollution and was more fuel efficient than other vehicles. However, the EPA found out that Volkswagen’s Clean Diesel Technology was actually a “Defeat Device” electric switch. The program would only activate based on a specific position of the steering wheel, the speed of the vehicle, how long the engine has been running, and the barometric pressure in order to determine if the vehicle was under normal or test conditions. The worst part is that Volkswagen knew about the situation and they kept it in a secret for seven years. Oliver Schmidt is one of Volkswagen’s engineers, was charged for defrauding the United States over the diesel emissions scandal. Oliver claimed that followed a script from the board to convince the CARB officials about their technology. However, Winterkorn claimed that he was not aware of the wrongdoing of his part.

Unethical Business

The reason why this situation is considered unethical is how the car manufacturer took advantage of the technology to cheat the testing facilities. The car company Volkswagen couldn’t figure out in a short amount of time of how they would be able to create a similar technology like Daimler’s Blue Tec. So the company decided to buy a technology from Bosch that would detect if the vehicle is being tested and it would turn on the emission-controlling device. Volkswagen was aware that the technology is only to be used for testing since it was considered illegal if it was installed in vehicles that were going to be sold to the public. Another reason why it was considered unethical is how the engineers lied to the board and CEO in order to keep their jobs. The former engineers said that they were terrified of the board if they ever had to bring bad news about a situation. So in order for them to bring bad news to the board, they also had to make sure they have good news.

Affiliated Parties

When it comes to the affiliated parties, they were not impressed of how Volkswagen got away with it for so many years. The main affiliated party that was disappointed with Volkswagen was the United States because they told them of how the vehicles should have lower emissions. However, Volkswagen lied about having a lower emission by using their “Defeat Device” on all of their vehicles sold. In response to the situation, The United States fined Volkswagen 25 billion dollars for the dieselgate. Not only did it affect their budget, but Volkswagen lost their huge reputation around the world.

Prevention

One way of how the unethical conduct could have been prevented is that the board of Volkswagen could have had a better leadership with their employees and not be selfish of always trying to make the company perfect. Another way that they could have done is to just partner up with Daimler so they could have the same technology as them and not worry about the situation of lying to the affiliated parties for so many years.

Potential Solution

If I ever had the opportunity to be involved in this situation, I would have told the board and the CEO of Volkswagen to work more on their ethics than the employees since they want the company to be successful without any flaws. I would have also told them to just partner up with Daimler to have the same technology as them so they would not have to worry about the situation that would have affect their reputation as a whole.