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VW scandal: How Volkswagen can regain customers’ trust

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6 October 2015

VOLKSWAGEN’S concession of corporate wrongdoing in circumventing Environmental Protection Agency (EPA) testing in the US has sent the global automotive industry into a tail-spin and pushed back developments in clean diesel technology and internal combustion engines by years.

Eight strategies for VW recovery:

  • Focus on emerging markets
  • Position hybrid and electric powertrain as priorities
  • Focus on passenger safety
  • Position the company as a pioneer in sustainable mobility  and synthetic fuels
  • Treat connected cars as a basic and major focal point
  • Bring Audi, Porsche, and other brands to the fore
  • Increase focus of commercial vehicle business
  • Conduct rigorous voluntary emission testing and certification

That’s the view on the VW scandal of growth partnership specialists Frost & Sullivan which says: “The immediate impact of this crisis goes beyond Volkswagen and the US reaching OEMs, many component suppliers, dealerships, regulatory authorities and testing agencies.”

Frost & Sullivan proposes eight strategies, listed right, that Volkswagen can utilise to regain consumer trust, fuel sales volumes and develop sustainable revenue growth opportunities.

Frost & Sullivan automotive & transportation senior research analyst Arun Chandranath says: “The Volkswagen crisis could have far-reaching implications for the future of diesel powertrain, resulting in even more stringent regulations and higher investment costs.

“Costs for carmakers to comply with emissions requirements could rise and consumers could be turned off by diesel cars.”

The automotive industry was prepared for an anti-diesel sentiment with the shift in new technologies making them more efficient and environmentally friendly than some petrol vehicles.

Automotive regulators have been more focused on climate change and greenhouse emissions than concerned for public health and air quality. Regulators are under immense pressure to ensure higher standards and to restore credibility.

“Recovery will not be easy for the world’s largest auto manufacturer, however transparency and communication is essential for Volkswagen to win back the market and consumer trust,” concludes Chandranath.

“Volkswagen’s recovery is critical for the overall health of the automotive industry. Currently, Volkswagen is standing trial, but everyone’s future is at stake.”

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