Recently, diesel vehicles have been the most popular vehicles in Europe. It is widely known that Volkswagen has great diesel technology. It became the leader among automobile companies by developing clean diesel, so what is it? It is good to know about the characteristics of diesel fuel. Its merit is its cheaper price than gasoline, which is normally used for many cars. However, there was a crucial flaw of the diesel fuel. It is that diesel fuel emits much more toxic gas than gasoline does, so Volkswagen made the clean diesel, which doesn’t have the flaw of diesel fuel. Thus, it also became popular in many countries including Korea, but it is not popular in the United States, which is the most important market in the world. It tried to promote the clean diesel vehicle in the USA, but ridiculously, its fraud was found during the process of a promotion.
  The market share of the clean diesel vehicle is just 3% in the USA. However, if clean diesel vehicles become popular in the USA, Volkswagen could be the undisputed number one vehicle company in the world. Thus, Volkswagen’s desire to conquer the American market was high, so it buried itself in promoting the clean diesel vehicle in the USA. However, ironically, fraud was found during its efforts. Volkswagen conducted an experimental promotion to show the clean diesel vehicle’s merit cooperatively with West Virginia University. During the promotion, researchers of West Virginia University discovered that the amount of discharge gases are different between experimental driving and real driving, so they reported it to the Environment Protect Agency. Due to the investigation by the EPA, Volkswagen installed software inside of the car to conceal the authentic amount of discharged gases. At the beginning, Volkswagen denied the EPA’s investigation and confidently said that it would recall all the cars which were sold in the USA if the claim was right. However, the claim was right, and Volkswagen admitted its fraud.
  If someone raises a bonnet to check the emission quantity of a car, the software starts. In this case, a car doesn’t emit bad gases while the bonnet is open. The EPA announced that the clean diesel cars of Volkswagen emit more nitrogen oxide, from 10 times to 40 times depending on the model. It was very shocking that this software was installed on Volkswagen’s representative models such as Golf, Beetle and Passat. Also, it was discovered that the software was also installed on vehicles of Audi, which is one of Volkswagen’s subsidiary companies.
  It is expected that Volkswagen will suffer from large-scale damages. At the beginning, Volkswagen announced that it would recall 500,000 cars sold in the USA, but the incident became a worldwide problem, so it decided to recall 11 million cars sold around the world. Moreover, it is suspected that 2.1 million Audi cars also have a problem. Therefore, Volkswagen will get more damage from that recall. Also, the EPA imposed an unprecedentedly high fine on Volkswagen. The amount of the fine is expected to be 18 billion dollars. Moreover, it is expected that Volkswagen will be sued by a lot of global consumers. Already, some groups are filing a suit against Volkswagen in Korea and Australia. The possibility that Volkswagen will lose the suits is very high, so its additional damage will be more than expected.
  Volkswagen’s monetary damages from recalls, fines and lawsuits will be tremendous, and its stock price dropped sharply by 40%. Moreover, there are invisible damages which Volkswagen will face. Volkswagen lost their main weapon, clean diesel. There were no eco-friendly diesel vehicles. Also, German engineering lost its worldwide reliability. These reasons will make it hard for Volkswagen to revive in the next several years.
  Dieselgate is similar to the 2009 Toyota Recalls. At that moment, Toyota concealed that its cars had risks of sudden unintended acceleration, so it recalled a great amount of cars after its fraud had been found. Experts are guessing whether Volkswagen will be damaged more than Toyota or not. Some experts say that Volkswagen will get more damage because Toyota just concealed a problem, but Volkswagen made the problem itself. On the contrary, some experts said that the Toyota Recall was more vicious than Dieselgate because the Toyota Recall was related to people’s lives, but Dieselgate is just an environmental problem. Thus, they insist that Volkswagen’s damage won’t be bigger than Toyota’s. Globally, it is under scrutiny whether Volkswagen can revive itself or not.

By Yoo Han-bin
hb36@cbnu.ac.kr