Volkswagen is in deep trouble. These 5 points explain the whole unbelievable scandal.
Volkswagen is in deep trouble.
The grimace on this bright red Beetle pretty much says it all:
The car company is currently embroiled in a scandal that is rocking the United States and Europe.
And it is — to a large extent — bananas.
The coverage has been so scattered, it's hard to get a sense of what, exactly, the hell is going on. Which is a shame because you can basically sum the whole thing up in five admittedly bonkers bullet points:
1. Volkswagen is accused of installing a secret device in millions of cars that allows them to cheat on emissions tests.
This is what diesel exhaust looks like:
At first glance it might seem like building a machine that emits a thick, black smoke not unlike the ashen upchuck of a thousand demons belching from the maw of hell might not be super ideal for the environment, generally speaking.
But for years, Volkswagen has been making passenger cars powered with the stuff. Lots and lots of 'em. Passats, Jettas, Beetles, Golfs, Audi A3s — the full fist.
They had lots of good reasons to do so, too. Diesel vehicles often feature better engine performance and fuel economy. Volkswagen argued they were clean enough, and sure enough, year after year, its vehicles passed inspection. But here's the thing:
The whole time customers thought they were getting this?
They were actually getting this:
According to a blockbuster investigation by the U.S. Environmental Protection Agency, many Volkswagen on-board computers were programmed with a secret algorithm that can sense when the car is being tested for emissions and lower the output of the engine accordingly. When actual tests were run, Volkswagen's diesel vehicles were spitting out up to 40 times (!!!) more nitrogen oxide than U.S. limits allow.
Initially, everyone thought the device was only installed in a few hundred thousand cars, all in the United States. But Volkswagen has since acknowledged that the modification was made to over 11 million vehicles worldwide.
This is exactly the type of extreme corporate malfeasance that usually results in coverups, denials, counter-denials, counter-coverups, and Matt Damon racing with smoking-gun documents in hand to a meeting with the FBI but Tilda Swinton is already waiting there with a hitman so no one ever finds out except maybe for his estranged ex-lover Jessica Chastain, who is seen opening a mysterious envelope in the very last shot.
Yet somehow, none of that happened in this case. Mostly because:
2. The company said, "¯\\_(ツ)_/¯," and basically up and admitted to all of the above.
To recap, the United States government accused Volkswagen of manipulating consumers, hoodwinking regulators, deceiving shareholders, and poisoning the atmosphere our great Mother Earth provided for her children to enjoy for all eternity.
And Volkswagen's response was, essentially, "Yep."
Or, more specifically, "Yep, uh. Yeah."
The evidence appears to be so rock solid that the company is ... not really denying anything. Either Volkswagen is playing the most head-scratchingly amazing game of 17-dimensional chess anyone has ever played, or they are really, world-historically screwed.
3. The CEO has resigned but claims he didn't know anything.
Until Sept. 23, 2015, the buck at Volkswagen stopped with CEO Martin Winterkorn, seen here, probably watching James Bond struggle to free himself from a glass cage that's slowly running out of oxygen because, well, just look at him. Jeez:
Winterkorn has denied all knowledge of any wrongdoing, and yet almost immediately stepped down from his post, quietly disappearing into some hedges surrounding VW's Wolfsburg, Germany, headquarters, never to be heard from again.
We are, I assume, supposed to see Winterkorn's denial as credible. Nevermind that this basically requires us to believe that some employee was sitting around the break room one day, halfheartedly playing Temple Run and thinking, "I've got this incredible idea for a complicated, quasi-legal international scheme that could either save the company or cost us billions and send dozens of our executives to prison. I'll just assume I have the green light."
But OK. We're with you, Marty. You do you.
4. The company has budgeted over $7 billion to deal with the fallout.
According to an NBC News report, Volkswagen has allocated $7.2 billion to "win back the trust of our customers" in the wake of the scandal. Not only is that, in corporate accounting terms, an everloving crapton of money, it's more than the nominal gross domestic product of 43 countries, as this street scene from Guinea-Bissau pretty well illustrates:
There are at least two possible explanations for this.
One is that, well, Volkswagen did the math and realized that jacking their tiny, sketchy computers out of a bunch of lightly-used Passats and the ensuing awkward ad buy to admit what they did was really going to cost them.
The other is that Volkswagen is still hiding something they're really, really embarrassed about. Which, for a car company founded by literal Nazis is saying something.
5. In a really bizarre, messed up way, this is good news for the environment. I know. I know. Just go with me here.
Many argue that here in the U.S., we should always be trying to cut our government "down to the size where we can drown it in the bathtub." Which is all well and good so far as it goes. Until some jerkwad company decides to start ejecting sooty, greasy, demon smog into the air. And you can't breathe. And you're like, "Uh ... government? You in there?"
The Volkswagen bust is an example of the Environmental Protection Agency doing what it does best: protecting the hell out of the environment in a way that has not just national but global implications. It makes the decision not to drown the EPA, despite repeated calls to do so, pretty darn sage.
And the best part? We get it on the cheap. The EPA runs the U.S. taxpayer just over $7 billion a year. "Now wait a minute," you might be thinking, "I thought you just said that was a crapload of money." And in car company terms, it is. But in U.S. government terms, it's pocket change. The Department of Defense, for comparison, set us back nearly $500 billion in 2015. You could have 71 EPAs for every one DoD.
Thankfully, we don't need 71. Because, as the Volkswagen saga makes abundantly clear, at the end of the day, one jacked up, 'roided out EPA is plenty good for the Earth.
Let's hope they keep on swinging for the fences.