A Case Study of Volkswagen Unethical Practice in Diesel Emission Test

1. A Case Study of Volkswagen Unethical
Practice in Diesel Emission Test

2. Volkswagen Profile
Type Brand
Industry Automotive
Founded 28 May 1937; 86 years ago
Founder German Labour Front
Headquarters Wolfsburg,Germany
Area served Worldwide
Key people Ralf Brandstaetter (CEO, Volkswagen)
Thomas Schäfer (CEO, Volkswagen Passenger Cars)
Revenue 279,232,000,000 euro (2022)
Operating income 22,124,000,000 euro (2022)
Net income 15,836,000,000 euro (2022)
Parent Volkswagen Group
Website volkswagen.com
Cogeneration plant
Logo since 2019

3. • 1933 – 39
Adolf Hitler approves Ferdinand Porsche’s design for the
“people’s car,” or volkswagen. A town called Stadt des KdF-Wagens,
now Wolfsburg, is established for factory workers in 1938. Full-scale
production is planned for September 1939, but war intervenes.
• 1939 – 45
During World War II, the Volkswagen plant is primarily used to
produce military vehicles, including the SUV-like Kübelwagen and
the amphibious Schwimmwagen. By 1943, more than 12,000
prisoners of war are working at the factory, most of them repairing
aircraft and building V1 rockets to bomb Britain.
• 1945 – 47
Stadt des KdF-Wagens is bombed, captured by U.S. forces in
1945, and then handed over to the British. Major Ivan Hirst paints a
Volkswagen green and shows it to British officials. They order 20,000.
American, British, and French motor companies decline to take over
the plant.
TimeLine

4. TimeLine
• 1948
Volkswagen, reorganized as a trust under West
German control, introduces the Volkswagen Type 2 van,
pickup, and camper, and the Karmann Ghia sports car.
• 1949
The Volkswagen Type 1 Beetle is exhibited and sold
in the United States for the first time. Only two units sell that
year, but sales soon pick up.
• 1955
Volkswagen Group of America is formed to standardize
service and sales in the United States. Production of the Type
1 Beetle increases drastically, reaching 1 million units.
• 1959
Sales soar as the witty “Think Small” ad campaign by
Doyle Dane Bernbach lures sophisticated (and younger)
consumers.

5. TimeLine
• 1968
Disney releases the first Love Bug film about Herbie, a VW
Beetle with a mind of its own.
• 1969
Volkswagen merges two previous purchases — Auto Union,
owner of the discontinued Audi brand, and NSU Motorenwerke — to
create the modern-day Audi, the company’s luxury brand.
• 1972
On February 17, the 15,007,034th Type 1 Beetle is made,
surpassing the Ford Model T as the most produced single model in
history.
• 1978
Volkswagen opens its first U.S. factory in New Stanton,
Pennsylvania, for North American production of the Rabbit, a hot seller
known as the Golf in Europe.

6. TimeLine
• 1993
The Golf Mk3 and the Jetta arrive in North America,
but fewer than 50,000 VWs are sold here, a record low.
• 1998
The Volkswagen New Beetle and the fourth-generation Jetta (along with the
1996 incarnation of the Passat) boost sales significantly in North America. The
Volkswagen Group acquires Bentley, Bugatti, and Lamborghini.
• 2002
Volkswagen announces the Phaeton line, a play for the luxury market, and the
Touareg, the company’s first modern sport-utility vehicle.

7. TimeLine
• 2003
On July 30, the final Type 1 Beetle rolls off the production line in Puebla,
Mexico. Car No. 21,529,464 is immediately shipped to the Volkswagen museum in
Wolfsburg.
• 2008
In July, VW announces plans for a $1 billion assembly plant in Chattanooga,
Tennessee. It will make cars designed for North America, including a midsize sedan
to compete with the Honda Accord and Toyota Camry. On October 26, Porsche,
which had been buying up VW stock, reveals a plan to assume control of VW.
• 2009
Volkswagen and Porsche announce a merger on May 6. In October, VW
announces it will take a 49.9% stake in Porsche for $5.75 billion. And in December,
VW takes a 19.9% stake in Suzuki, a deal valued at $2.5 billion.

8. Volkswagen
emissions
scandal
A 2010 Volkswagen Golf TDI with defeat device displaying "Clean Diesel" at the Detroit Auto Show

9. Volkswagen
emissions scandal
The Volkswagen emissions scandal,
sometimes known as Dieselgate
or Emissionsgate, began in September 2015, when
the United States Environmental Protection
Agency (EPA) issued a notice of violation of the Clean
Air Act to German automaker Volkswagen Group. The
agency had found that Volkswagen had intentionally
programmed turbocharged direct injection (TDI) diesel
engines to activate their emissions controls only during
laboratory emissions testing, which caused the
vehicles' NOx output to meet US standards during
regulatory testing. However, the vehicles emitted up to
40 times more NOx in real-world driving. Volkswagen
deployed this software in about 11 million cars
worldwide, including 500,000 in the United States,
in model years 2009 through 2015

10. Participants in Volkswagen Emission Test
Scandal
A managerial group consists of nine (9) managers from
supervisory board, quality control and assurance, engine
designers, plant managers, and managers of sub-companies
such as Porsche and Audi.

11. Fraud and Deception
Making a series of deceptive claims about the
environmental impact of the company's "clean diesel" fleet.
Falsifying the results of emission test.

12. Effect on their Stock Price

13. Volkswagen consequences
• Diesel Emissions Settlement Program
• Emissions Modification Process
• Approved Emissions Modification and Warranty
Disclosures
• Paid $25 billion in fines for their legal responsibility in
numerous nations.

14. Health consequences
• Deaths
A peer-reviewed study published in Environmental Research
Letters estimated that approximately 59 premature deaths will be caused
by the excess pollution produced between 2008 and 2015 by vehicles
equipped with the defeat device in the United States.
• Non-fatal health impacts
Asthma, Bronchitis and Emphysema. Nitrogen oxides amplify the
effect of fine particulate matter soot which causes heart problems, a form of
air pollution estimated to kill 50,000 in the United States annually.

15. Environmental consequences
• Acid Rain
NOx also contribute to acid rain, and visibly brown clouds or smog due to
both the visible nature of NO2, and the ground level ozone created by NO.
NO and NO2 are not greenhouse gases, whereas N2O is. NO2 is a precursor
to ground-level ozone.

16. Conclusion
Volkswagen deceptive scandal is an overwhelming complicated case
having created dramatic hassles for its direct and indirect
stakeholders. Albeit Volkswagen cheating in diesel emission test was
an unethical action resulting in series of disastrous consequences, the
proposal of green punishment is a suitable solution to finalize this
case. Electronic cars enable environment protection agencies to save
cost and time for finding out new systems for controlling emission
tests. Moreover, in this way, Volkswagen is not only penalized but also
compensates its scandal appropriately. In conclusion, since this is an
ongoing case, there is a chance to lodge the proposal of green
punishment to judge to solve the issue in a win-win method.

17. reference
• https://www.fastcompany.com/1512941/history-volkswagen
• https://en.wikipedia.org/wiki/Volkswagen#:~:text=Founded%20in%20
1937%20by%20the,sales%20in%202016%20and%202017.
• https://www.fastcompany.com/1512941/history-Volkswagen.
• https://en.wikipedia.org/wiki/Volkswagen_emissions_scandal#Legal_
and_financial_repercussions
• https://www.researchgate.net/publication/303797234_A_Case_Study
_of_Volkswagen_Unethical_Practice_in_Diesel_Emission_Test