Case Study: Volkswagen’s Diesel Emissions Control Scandal

Abstract

This case study traces the events that led VW to evade U.S. carbon emission regulatory standards, and actions undertaken by its CEO Mathias Müller to restore profitability and public trust in the company. Despite admitting its guilt, the company faced many unanswered questions. The scandal caused VW’s stock to lose 35% of its value in the week following the shocking discovery. The case addresses three areas: (1) What things led to VW’s unethical actions? (2) What was VW doing to correct its transgressions? and (3) What strategic actions was VW undertaking to restore market confidence and trust in the company?