Volkswagen Scandal Causes Distrust With Clients

Herbert Diess extended an apology to all Volkswagen investors and customers at the Tokyo Motor Show for the emissions test cheat scandal the company has just been thrown into.

Volkswagen - Clapway

The American Environmental Protection Agency found a software installed on Volkswagen diesel vehicles which allowed the cars to cheat emission tests, and immediately after the news broke out, the automaker’s Japanese sales dropped by a third. This was fueled most likely by the scandal, but also by the lack of new models.

The company faces a potential recall of millions of cars and an $18 billion fine. Diess promised to bring a new and better Volkswagen to the world, and that the company’s first priority is not their stocks but rebuilding trust with their customers to the brand.

Immediately after issuing the apology, Diess and Sven Stein, head of Volkswagen’s Japan division, unveiled their newest plug-in hybrid sport utility car. This scandal also prompted the delay of the release of a diesel model in Japan, from the first quarter of 2016 to the second half. Though it doesn’t use the same engine or software as the cars involved in the scandal, the company didn’t want to put customer trust in further jeopardy.

Volkswagen had initially beat Toyota to the top of the Japanese auto market on the first half of 2015, but now Toyota has reclaimed is throne. It’s yet to be seen how Volkswagen will recover as 2016 sets in.