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Presented By:
Anurupa Banerjee (PGP03014)
Arjun Dixit (PGP03015)
Kaushik Bagchi (PGP03029)
Mohit Yadav (PGP03033)
Nivedita Das (PGP03039)
Prince Sharma (PGP03045)
Sanat Kumar Gabel (PGP03052)
Yash Shah (PGP03063)
TheVolkswagen Dieselgate Crisis
Volkswagen: An
Overview Since 1937
‘People’s Car’
Icon of post war West German regeneration
Product line expansion with Beetle, Passat, Golf and Luxury car
subsidiaries
Worldwide presence – cars sold in 153 countries
Marketing campaign as Friendly carmaker and emphasis on customer
relation. Recently they started to preach environmental virtues,
emphasizing its diesel cars.
History of the
Volkswagen
Dieselgate Scam
2009
• Volkswagen started installing defeat devices.
2013
• Abnormalities found in test by researchers from the
international council on clean transportation and
west Virginia university.
2014
• Environmental protection agency investigation
begins.
2015
2015
Sept 3
• Volkswagen admits that it has used sophisticated
software to trick regulators.
Sept 18
• Environmental Protection agency makes Volkswagen
deception public.
Sept 23
• Volkswagen CEO Martin Winterkorn resigns.
Analysis of the crisis
Global scale
Cross cultural conflicts
Number of cars affected is huge – 11 million
Clear case of well planned conspiracy and fraud
SCCT – Situational Crisis Communication Theory – Intentional Crisis
Customer resent – decreased car valuation? Replacement?
Compensation package?
CEO’s apology video
Apology in newspaper
Response To Social
Media
When bad news breaks out, keep quiet
They put their marketing and promotion to a halt and instead focus on
addressing the concerns of their customers.
Michael Horn the US CEO, offered his explanations on behalf of VW
Give your customers honest answers
In the early stages of the scandal, many people went to the VW Twitter and
Facebook channels to contact the brand directly, in order to find out how the
scandal would affect them. Nearly 10 days after the scandal broke out
Volkswagen published an FAQ page to their site, addressing all the common
concerns of customers.
Brand advocates to the rescue
Amongst the negativity, a number of people still had some positive
sentiments to share about the brand. Both staff and customers expressed
their support for the company so they stayed positive.
Immediate
Steps to Overcome
the crisis
Acknowledging the scandal
Taking actions to compensate the deceit
Connecting with the customers
Started issuing financial compensation for customers
Buying back some unsellable, used diesel vehicles
Post Scandal
Strategies
Volkswagen to refit cars affected by emissions scandal.
More authority will be given to individual brands and regions.
Special Group created , in an effort to repair its reputation in the
market.
PR strategies – Video Apology to the Customers on twitter.
Offer of Incentives to attract customers and offset lost sales
Introduction of electric cars
 VW Video
Effect of the steps
after the scam
They shrugged off the ‘Dieselgate” with surging sales and profits.
First quarter of the year sales at the group - which includes the Audi,
Bentley, Porsche, SEAT and Skoda marques - rose 10.3pc to €56.2bn
(£47.5bn)
Started issuing financial compensation for customers
Buying back some unsellable, used diesel vehicles
Despite the stronger financial performance, vehicle sales numbers
edged back, dropping 0.5pc on last year’s level to 2.495m
Paid out billions of dollars in penalties
 Delivery of the logic behind the initiative. – “Logos”
Brand ambassadors, Virat Kohli in India – “Ethos”
Plans to launch electric cars: – “Pathos”
Conclusion
and
Inferences
Crisis Management is more than just a good PR Campaign
Accountability
Sincerity
Commitment to Change
Embracing the future
Aristotle’s Framework: The Art of Rhetoric
Thank You!

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Volkswagen Dieselgate Crisis

  • 1. Presented By: Anurupa Banerjee (PGP03014) Arjun Dixit (PGP03015) Kaushik Bagchi (PGP03029) Mohit Yadav (PGP03033) Nivedita Das (PGP03039) Prince Sharma (PGP03045) Sanat Kumar Gabel (PGP03052) Yash Shah (PGP03063) TheVolkswagen Dieselgate Crisis
  • 2. Volkswagen: An Overview Since 1937 ‘People’s Car’ Icon of post war West German regeneration Product line expansion with Beetle, Passat, Golf and Luxury car subsidiaries Worldwide presence – cars sold in 153 countries Marketing campaign as Friendly carmaker and emphasis on customer relation. Recently they started to preach environmental virtues, emphasizing its diesel cars.
  • 3. History of the Volkswagen Dieselgate Scam 2009 • Volkswagen started installing defeat devices. 2013 • Abnormalities found in test by researchers from the international council on clean transportation and west Virginia university. 2014 • Environmental protection agency investigation begins.
  • 4. 2015 2015 Sept 3 • Volkswagen admits that it has used sophisticated software to trick regulators. Sept 18 • Environmental Protection agency makes Volkswagen deception public. Sept 23 • Volkswagen CEO Martin Winterkorn resigns.
  • 5. Analysis of the crisis Global scale Cross cultural conflicts Number of cars affected is huge – 11 million Clear case of well planned conspiracy and fraud SCCT – Situational Crisis Communication Theory – Intentional Crisis Customer resent – decreased car valuation? Replacement? Compensation package? CEO’s apology video Apology in newspaper
  • 6.
  • 7. Response To Social Media When bad news breaks out, keep quiet They put their marketing and promotion to a halt and instead focus on addressing the concerns of their customers. Michael Horn the US CEO, offered his explanations on behalf of VW Give your customers honest answers In the early stages of the scandal, many people went to the VW Twitter and Facebook channels to contact the brand directly, in order to find out how the scandal would affect them. Nearly 10 days after the scandal broke out Volkswagen published an FAQ page to their site, addressing all the common concerns of customers. Brand advocates to the rescue Amongst the negativity, a number of people still had some positive sentiments to share about the brand. Both staff and customers expressed their support for the company so they stayed positive.
  • 8. Immediate Steps to Overcome the crisis Acknowledging the scandal Taking actions to compensate the deceit Connecting with the customers Started issuing financial compensation for customers Buying back some unsellable, used diesel vehicles
  • 9. Post Scandal Strategies Volkswagen to refit cars affected by emissions scandal. More authority will be given to individual brands and regions. Special Group created , in an effort to repair its reputation in the market. PR strategies – Video Apology to the Customers on twitter. Offer of Incentives to attract customers and offset lost sales Introduction of electric cars  VW Video
  • 10. Effect of the steps after the scam They shrugged off the ‘Dieselgate” with surging sales and profits. First quarter of the year sales at the group - which includes the Audi, Bentley, Porsche, SEAT and Skoda marques - rose 10.3pc to €56.2bn (£47.5bn) Started issuing financial compensation for customers Buying back some unsellable, used diesel vehicles Despite the stronger financial performance, vehicle sales numbers edged back, dropping 0.5pc on last year’s level to 2.495m Paid out billions of dollars in penalties  Delivery of the logic behind the initiative. – “Logos” Brand ambassadors, Virat Kohli in India – “Ethos” Plans to launch electric cars: – “Pathos”
  • 11. Conclusion and Inferences Crisis Management is more than just a good PR Campaign Accountability Sincerity Commitment to Change Embracing the future Aristotle’s Framework: The Art of Rhetoric