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One of the most scandalous incidents in 2015 was the Volkswagen emissions case. In September 2015, it was revealed that the company purposefully rigged the diesel engines software. The latter ensured that emissions were always at the necessary level for the diesel car to pass the emissions test in the United States. Eventually, the company admitted that the software was supposed to recognize when the vehicle was being tested (Hotten para. 1).
The incident leaked into the news on the 18th of September 2015 and was dubbed “Dieselgate”. This matter affected not only Volkswagen but also Audi, Skoda, and Seat, adding up to 11 million vehicles implicated in the scandal. According to Spence, the Volkswagen software allows for passing the laboratory tests, but while driving, the emissions controls are deactivated (Spence para. 2). This means that when on the road, Volkswagen-manufactured vehicles emit pollutant substances, such as nitrogen oxide, nearly forty times the legal limit. The software was developed explicitly for the purposes of regulating the emissions according to the situation.
The algorithms of the software determine the steering patterns, engine use, air pressure, and other key features that help identify whether a vehicle is being tested. The laboratory tests involve putting the vehicle on a stationary rig, which is detected by the software and a so-called safety mode is switched on, where the emissions are reduced to the legal limit. The software was dubbed a “defeat device”. In many countries, including European states, investigations are being carried out to determine the extent of the damage caused by the Volkswagen’s policy regarding the emissions of pollutants.
As a result, the company faces significant problems. First and foremost, Volkswagen betrayed their customers’ trust thereby losing their loyalty. The company’s reputation is significantly damaged. It will be rather difficult to regain the clients’ loyalty and reestablish the company as trustworthy. Moreover, Volkswagen incurs significant losses that amount to 2.5bn euro, as well as 12bn euro of penalties. Multiple fines and lawsuits filed by certain civil groups exacerbate the company’s position. The situation was aggravated when the public found out that the cheating software has been in use for six years. Now, many people are apprehensive of all manufacturers of diesel cars, as they fear that similar tricks could have been employed. It is a valid reason for concern, as such morally dubious practices as demonstrated by Volkswagen entail not only fines and penalties for the company but also major inconveniences for the owners of the cars in question. Spence emphasizes that the owners will eventually have to pay higher fuel bills because of this scandal (para. 6). Moreover, even though the company offered to make amends, the cars that are rewired will not run in the same way as it was promised prior to the purchase.
The ethical decision model comprises several stages, the first of which, “Determine the Facts”, is outlined above. It was specified what the company has actually done to damage its reputation to such a great extent, as well as what repercussions will subsequently follow. In order to identify the ethical issues involved in the given context, it is necessary to specify which actions of the company should be under scrutiny. The main decision of the company’s management that is ethically questionable is the decision to invest in the development of the described software. A clear dimension of right and wrong is visible in this case, as the company knowingly made such a decision, admitting their fault when the scandal was publicized. Moreover, the ethical dimension is multifaceted, as the unethical decision to rig the laboratory tests had a negative impact on many parties, including the customers, the stakeholders, the environment, and the company itself.
The stakeholders that were affected by Volkswagen unethical policies can be divided into several groups: customers and suppliers, financial market, employees, governmental agencies, NGOs, and research institutions. In the fourth stage of the ethical decision model, it is necessary to indicate what alternative courses of action could be taken. It is reasonable to suggest that the first alternative would be for the company to abandon the unethical practices before they became a public matter. It was already mentioned that Volkswagen continued falsifying the laboratory tests for six years.
The immorality of their chosen policy should have been acknowledged before the scandal, and steps should have been taken to curtail the cheating mechanisms, as well as modify the software. Another alternative course of action could have entailed refraining from the discussed decision at the very beginning. The suggested alternatives would be beneficial for the stakeholders, as their losses would be reduced or eliminated and their trust would not have been lost. In the case of the first alternative scenario, a certain degree of harm would have been done nonetheless, but the damage would be minimized. Legal regulations stipulate a certain limit of emission of polluting substances in diesel cars. Thus, Volkswagen’s unethical decision-making led them to commit a crime, which is also affecting stakeholders.
The decisions made by Volkswagen were unethical and disrespectful to the customers and stakeholders of the company. Every person involved was negatively affected by the company’s policies regarding emission levels. Moreover, a negative influence on the environment was exerted. When considering the phrase “All solutions just create different problems”, it is evident that in the case of Volkswagen emission test, adopting a different approach would clearly minimize or eliminate the losses incurred by the company and the stakeholders, as well as save the company’s reputation.
Hotten, Russell. Volkswagen: The Scandal Explained. 2015. Web.
Spence, Peter. VW Emissions Scandal: What’s It All About? 2015. Web.