Dieselgate, ten years after the tsunami that swept through the car industry and nothing was ever the same again

The fine dust particles resulting from driving a car come to a small extent from exhaust fumes, which, according to accredited studies, account for less than 10%. A much larger percentage, around 25/35%, comes from brake and tyre wear. More than half is dust that is kicked up from the ground, so much so that when it rains the limits are never even touched. Since it is the traffic much more than the engine and its exhaust that determines the amount of PM, the solution would be to wash the roads. An experiment conducted a few years ago by Dekra in Stuttgart confirmed this: by washing the roads, the days of exceeding the limits decrease dramatically. Back to the engine that cleans the air. Combustion is done on a mixture of fuel and air, the latter obviously brought in from outside and therefore full of PM. After combustion, very sophisticated filters in the exhaust system trap not only particles from the diesel but also those already in the air. In addition, in the combustion process, an agglomeration of particles, the so-called soot cake, is formed, which binds together both the larger particles, PM10, and the very small ones, PM2.5, so that both are retained in the filter.

The United States, never sensitive enough to environmental issues, let alone energy issues, had not developed a significant demand for diesel such that the industry invested in R&D. For some time, however, demand had been growing for German cars equipped with this engine, more as a sign of certain coastal and affluent elites than out of genuine appreciation. The trade balance on cars was hugely unbalanced in favour of Germany. German cars landing in America each year were about ten times as many as American cars crossing the ocean on the reverse route. Mind you, these were not tariffs war figures or strategic defence products, but certainly if German imports had been kicked around a bit no one at the Department of Commerce would have lifted a finger.

The media reported the news of the ECU tampering carried out by Volkswagen technicians. It was not the first scandal involving the automobile industry. Two examples. In the 1970s, the Ford Pinto became infamous for its safety problems. This sub-compact had a design flaw that made it vulnerable to fire in the event of a rear-end collision. In 2004, it was the turn of the Toyota, whose accelerator pedal would not go back up and the car would continue driving at speed, causing accidents. In both cases, the media were compelled to report fatalities, which fortunately did not occur in the case of the Volkswagen control units. Yet, there is no recollection of a 'tank-gate' that called into question the tank equipment of all cars, nor a 'pedal-gate' to ban cars from being equipped with accelerators. They were dismissed as design or production faults, the appropriate penalties and sanctions were sprinkled on them and then that was it: turn the page and move on.

In the case of the ECUs, the press, with a few exceptions, acted differently. First of all, it pointed the finger at the type of engine and not at the tampered ECU. It was 'ECU-gate' and instead was labelled 'diesel-gate'. The tampering had been carried out by Volkswagen, so it was 'Volkswagen-gate'. Nothing, it was 'diesel-gate'. This fact gives a measure of the vileness of the press. Not only that, it also indicates the presence of a motive. Why leave a big target like Volkswagen alone, hiding it behind a type of engine produced by everyone and effectively spreading the blame over the entire industry? Because there was already a lot of pressure against the diesel engine at the time, which made the Volkswagen morsel unpalatable and certainly not aimed at the cause. It is not clear who the financial instigators of the various environmental movements were, but the fact is that the target became technology and European supremacy over the diesel engine.

In truth, in the first weeks, the media had also targeted Volkswagen, reporting to the public that this scandal had destroyed the Group's credibility and the trust customers placed in its products. Again, this was more aspiration than fact. Those signatures wanted to describe a world that they thought was right, namely of customers who would banish those brands from the automotive shopping list. Too bad that world did not exist. Yes, in the heat of the moment there was condemnation and even strong disappointment on the part of customers, but this resulted in a moderate drop in sales. In the years that followed, the value of the Volkswagen brands among customers remained high and solid, as did sales. An analysis conducted by the Fleet&Mobility Research Centre revealed that in the wake of the scandal, in the autumn, sales of Volkswagen and, to a lesser extent, Audi, fell significantly. But the analysis also said that those who had not bought Volkswagen had not opted for other brands, but had merely exited the market, which had in fact declined. Temporarily. By the end of the year, sales had returned to pre-scandal levels and with them the market had regained its volumes. In short, the facts said that yes, Volkswagen managers had rigged an ECU and that no, you don't do that, but the products were still very good and therefore worth buying. The graph shows the value of the brand, as measured by Interbrand, a company specialising in measuring the value of brands, estimated at USD 13.7 billion in 2014 and devalued in the following two years to 12.5 and then 11.4. Yet, already in 2018 it was revalued at 12.2. Last year the brand was credited with a value never before touched in its history: 15.1 billion. Audi's value was not even touched by the scandal and continued to grow year on year. In 2018 it had equalled Volkswagen and was worth 16.4 billion in 2023.

Translated in terms of consumer sociology, it sounds something like this. When I buy a car I want the one I think is the best I can get with that money. Then I can also criticise its manufacturer for his behaviour, but certainly not to the point of depriving myself of his product: I am not punishing myself by thinking of punishing him. This graph, however, also says something more. It says that that of the manufacturer Volkswagen is a success story that comes from far away, that in a decade it has doubled or tripled the absolute value of its brands. Such a story is made up of culture, factories, customer franchises, distribution networks and, above all, millions of customers who every day get into one of its cars, drive it with satisfaction and speak well of it to their acquaintances. But did you really believe,' concludes the graph, 'that one mistake could wipe all that out? Sure, they made mistakes. They are men and they make decisions. Sometimes wrong ones. Like everyone else. But these dovetail with all the history and all the other right decisions. Today is a time when many manufacturers believed that newcomers, telling a tale about the environment or smartphone-type gadgets, could take customers away from them. Instead of attacking them and belittling their ability to build what customers want, a car, they followed them on their own ground, choosing to overshadow the essential product: the car.

If the customers were rather sympathetic towards the German manufacturer, despite the media having done everything possible to alienate their trust, the group's top management took a very stern and inflexible attitude - towards itself. The number one, CEO Martin Winterkorn, appeared on TV to say two things: that he admitted responsibility and apologised: 'utterly sorry'. Then the next day he resigned: 'Volkswagen needs a fresh start - also in terms of personnel. I am clearing the way for this fresh start with my resignation." In the years that followed, the group would also ask him for damages, for attending an internal meeting in July 2015, where those measurement altering devices were discussed, and not intervening to stop such use. The agreement was that he would compensate with EUR 11.2 million out of his own pocket, in addition to EUR 270 million compensated by the insurance that covered the actions of his managers. Did this attitude increase or mitigate the damage that followed? Could they have acted differently? There are conflicting opinions, but obviously no possible certain answer, since history is never written twice.

Of course, other builders were also affected by the scandal, but they did not admit any guilt and preferred to leave the affair to lawyers and the courts, where they lost track of it - from a media point of view, which is the only one that really counts. Over the years and with microphones turned off, some of the group's managers have spoken out on the affair. First of all, they have shown their deep loyalty to the company and its crisis management and communication strategy. A sign of high and widespread professionalism. As for the reasons for such a policy, reasons that they themselves have researched, it seems that they can be traced back to the particular culture of the Germans, always in love with the super-man (they imagine him to be Teutonic, needless to say) and who consequently find it unbearable to be caught 'with their hands in the cookie jar' still resentful of the last time history tried and condemned them. This would make it imperative to distance themselves from evil and seek, if not forgiveness, at least atonement.

Many trace back to diesel-gate what happened to the European car industry in the following years, up to the current disaster of investment in a transition that many, too many customers reject. In reality, in the absence of a direct relationship, it can rather be said that this scandal manifested the weaknesses of the industry, which was unprepared for a popular attack and lacked the support of politics, which had always courted it in the previous hundred years. The attack came from the 'anti-car party' in which large portions of western civil society found themselves, who identified the car as the symbol of a consumerist lifestyle to be distanced from. Overwhelmed by the very success of western civilisation, they found in the protection of the environment the purpose of their civic commitment, even unrelated to actual, tangible results.

The industry, unaccustomed to reacting to its own customers, failed to distinguish between the citizen, the bearer of environmentalist demands, and the motorist interested in the product as a mobility solution. They were the same person, but expressed different positions, in their civic commitment and in their choice of a car. The lack of reaction also depended on the assessment, which turned out to be wrong, that the attack was aimed at one technology, the diesel one. Therefore,' was the thought, 'if they don't want diesel cars they will buy petrol ones: where's the problem? In reality, the target was not an engine but the car. In any case, inspired by the parable of the 'lost sheep', the industry should and could have defended that technology with all its might, because when even one part of your business is under attack, you have to react as if everything was under attack. Again, this industry was not used to being under attack.

(from White Paper -from Dieselgate to the present day)