Home' Trinidad and Tobago Guardian : September 24th 2015 Contents BG20 iNTERNATIONAL
BUSINESS GUARDIAN www.guardian.co.tt SEPTEMBER 24 • 2015
German engineering may lose some mar-
keting pop after Volkswagen s stunning
admission that it rigged emissions tests.
The revelation is particularly damaging
since Volkswagen has long pinned its rep-
utation on its technological prowess, with
the tagline, "Isn t it time for German engi-
neering?," along with its focus on environmental sustainabil-
"Brands are all about trust and it takes years and years to
develop," says Nigel Currie, an independent UK-based branding
consultant. "But in the space of 24 hours, Volkswagen has
gone from one people could trust to one people don t know
what to think of."
The company apologized and the CEO stepped down, but
Volkswagen has yet to explain how the cheating was allowed
to occur. The company risks alienating not only fans of the
"People s Car," but dealers, the local face of the brand, who
feel blindsided by the scandal.
"The most important thing is that VW comes out and tells
the public what happened, who was involved and make sure
that it doesn t happen again" said Jeremy Robinson-Leon,
principal and chief operating officer at New York-based cor-
porate and crisis PR firm Group Gordon.
That communication needs to happen soon, says Michael
Jackson, the CEO of AutoNation, the largest auto dealership
chain in the U.S. He says VW diesel owners are angry and
dealers don t have enough details to share with them. Jackson
gives VW a week to explain its actions or he feels the brand
value will be damaged.
VW risks losing owners like Peggy Schaeffer, 64, a librarian
from Durham, North Carolina. For Schaeffer, her 2010 diesel
Jetta Sportswagen was the ideal car, peppy but still environ-
mentally friendly. Now, "I really feel like I ve been had. I ve
been hoodwinked. This is deliberate fraud and deceit," she
says. Schaeffer is uncertain what she ll do next.
"I ll watch and wait and see how the company behaves,"
Being an environmentally friendly company is in Volkswagen s
DNA. Back in the 1960s its first U.S. ads urged people to
"Think Small" in an era of gas-guzzling cars. More recently,
Volkswagen launched a global "Think Blue" campaign in 2010
with the aim to "become the world s most ecologically sus-
tainable car manufacturer" by 2018.
"They had a brand image that is very straightforward, honest
and in recent years dependent on being a leader on environ-
mental standards and pushing those," said Kelly O Keefe, pro-
fessor of brand management at the VCU Brandcenter. "Now
it appears they ve been cheating to get there, which is a dev-
Recent ads have promoted its "clean diesel" technology,
which provides high fuel economy, in its Passat, Jetta, and
other cars. One campaign shows older ladies in a Passat bick-
ering about whether diesel fuel is "sluggish" or "stinky." A
Jetta ad says the car s engine is "painstakingly engineered
The scandal broke Friday in the US, and the last "Clean
Diesel" ad ran Monday, according to iSpot.tv, which tracks
TV ads in real time. Volkswagen appears to have pulled the
ads from its YouTube channel, although they remain on some
dealer pages and elsewhere on YouTube.
Volkswagen should now focus on its cars with gasoline
engines and be very aggressive with pricing promotions, said
David Kiley, author of "Getting the Bugs Out, the Rise, Fall
and Comeback of Volkswagen in America." Volkswagen did
not respond to a query about future advertising plans.
"This really shoots to pieces the diesel business," Kiley says.
In fact, YouGov BrandIndex, which tracks a brand s per-
ception, said news of the scandal has brought the carmaker
to its lowest U.S. consumer perception levels in more than six
and a half years.
VW may also need to pull back on the whimsical side it
cultivated with Super Bowl ads like "The Force," in 2012
showing a young boy dressed like Darth Vader using his pseu-
do-powers on a Passat; and a 2013 ad depicting a man so
happy driving a Volkswagen he started speaking in a Jamaican
"It s really hard to do cute when people don t trust you,"
VCU Brandcenter s O Keefe says.
More broadly, Volkswagen s environmentally friendly image
has taken a big hit, said Ann-Christine Diaz, editor of ad trade
magazine Creativity. The company, once known for a flower
vase installed in every Volkswagen Beetle, has worked hard
globally on that image, she says. For example, a campaign out
of Russia in 2015 --- part of the "Think Blue" environmental
sustainability campaign --- featured vending machines installed
around Russia that only accepted used batteries as payment.
"They set out to become the most eco-friendly car brand
by 2018," Diaz says, referring to the goal of the "Think Blue"
campaign. "Now Volkswagen looks like a big hypocrite."
Of course, brands have weathered scandals before. Johnson
& Johnson survived a recall of Tylenol after cyanide was found
Volkswagen's clean-car image
dirtied by emissions scandal
Continued on Page 21
FILE - Patty Ramge poses with her 1975 Ford Pinto that bears a sign warning fellow motorists to keep their distance, in Detroit in this Sept. 1, 1978 file photo. Ramge posted the warning after
weeks of trying to convince Ford Motor Co., and its dealers to modify the Pinto's fuel tank so it would not pose a fire hazard in a rear-end crash. At least 27 people died during the 1970s due to the
faulty position of fuel tanks in the Ford Pinto. (AP PHOTO)
Links Archive September 23rd 2015 September 25th 2015 Navigation Previous Page Next Page