Can a Textbook Crisis Response Save Das Auto?

First published in the Nov/Dec 2015 IABC Toronto Communicator

For years, communicators have preached the value of timely damage control. Don’t hide. Assume responsibility. Tell the Truth. Show concern. And, take positive action. The blueprint set in 1982 by Johnson & Johnson’s Tylenol crisis has served many companies well. But critics are questioning whether a textbook response is enough for Volkswagen. Many car companies have had their troubles with finances, recalls and deaths, but “Dieselgate” is different.

Some predict that VW will not survive because this was not a malicious prank by an outsider. It was also not an oversight, incompetence or a mistake. While there were no deaths or injuries, this was deliberate fraud on a grand scale. How do you spell malfeasance? The company created software to cheat on emissions tests and break the law.

Two years ago, VW was criticized for being slow and insincere in reacting to a gearbox problem. This time, it was quick off the mark, but its response was still lacking.

Even though he admitted the company’s fault, Martin Winterkorn’s apology was weak. He resigned and a few more heads rolled while the new CEO agreed to cooperate with authorities and be relentless in the investigations. But then, there was silence.

I wondered if they were scrambling because the crisis communications plan didn’t cover this scenario. But then, word spread that lawyers were running the show and information was being stifled. It always disappoints me when the communicators are not used to full potential. Certainly, the company would not have wanted to provide inaccurate information, but, if it ever wants to re-build its brand, it has to be completely accountable and transparent.

Considering the fines, criminal investigations, hundreds of class-action lawsuits, devastated stock price, stalled sales and a possible movie by Leonardo DiCaprio, VW’s brand is seriously tainted. Cover-up is an ugly word.

When it comes to cars, people care about safety, comfort and price. But, I think trust and integrity remain huge factors. Not to joke, but the term “German engineering” has taken on a new meaning.

So far, VW’s efforts seem symbolic. More people have been suspended and the company has set a deadline for whistleblowers to come forward, but many questions remain. There are vague promises and small offers of cash and vouchers, but dealers and customers continue to feel the pain. News of missing files and talk of multiple defeat devices suggest the cancer is more widespread than originally thought. And, now investigations have extended to other brands. Still, in spite of what this scandal will mean for VW’s bottom line, I can’t agree with the critics who are ringing the death knell. I prefer to talk about reputation, the company’s most priceless asset.

Saving even a fraction of Volkswagen’s reputation won’t be easy. Regardless of legal consequences, VW needs to be open and honest. It needs to follow through with big, bold actions and fix the problems. Instead of talking about corporate re-structuring, it should talk about what it’s actually doing to make things right. And, in the longer term, it should spearhead clean air initiatives. Re-building trust is going to take strong leadership. It’s also going to take a very, very long time.