Volkswagen has been through a tough year or so. Sure, most of it was self-inflicted, what with the emission scam and subsequent fall from grace among car buyers. But a recent revelation shows how the company plans to regain consumer confidence and once more be known for innovation and quality.
The company recently announced plans to launch 30 – yes, 30 – all-new fully electric models in an effort to solidify its claim as the “green” automaker of record. From “dieselgate” to “all electric”? Maybe it’s an over correction, or it may just be the smartest way for the company to get people to (finally) stop talking about the trans-continental emissions scam.
Investing in Electric
According to the Associated Press, Matthias Mueller, VW’s CEO, said the company plans to make massive investments in clean energy cars, hoping to transform up to 25 percent of its fleet to fully electric within the next ten years.
There’s no doubt the company needs some spark, as it continues to lag behind many European competitors. Tough break for a company that was rising to the top and could have set itself up to reign over all other European automakers in total international auto sales.
Mueller called the decisions a “fundamental realignment” in the company’s core process and program. He said it was incumbent on VW to capture some lost mojo by focusing on the fastest growing market segments rather than trying to muscle back into ground it previously ceded to the competition after the emissions scandal broke.
There is no doubt that “new” and “innovative” can indeed grab attention, but can they hold that attention long enough to establish trust? Trust is vanquished much easier and faster than it can be built, much less rebuilt, so it will take more than Shiny And New to get VW back where it wants to be in the hearts and minds of consumers across the globe.
Consumers Demand Transparency
Part of that fundamental realignment must be to address the culture that not only encouraged but rewarded cheating until they got caught. Consumers don’t expect car companies to be saints. We all understand how competitive that marketplace is. But, really, don’t lie to us, especially about something that could be fixed but was designed to be deceitful.
And that’s the rub. VW didn’t cover up a mishap, they, according to multiple media reports, colluded and conspired to delude the consumer public. That’s going to be a charge that no amount of electricity will be able to redirect on its own…
David Milberg is a financial analyst in New York City.