How dearly will Germany pay for the Volkswagen emissions rigging scandal

Arrival and doorstep comments by Étienne Schneider, Luxembourg Deputy Prime Minister and Minister of the Economy, at the Informal Meeting of Energy, on 23 September 2015, in Luxembourg. He answered questions about the Volkswagen affair without being able to clarify the matter from EU’s perspective. Luxembourg currently holds the rotating EU Presidency. (European Council – Council of the European Union Audiovisual Services. Snapshot from a video footage, 23/09/2015).

Arrival and doorstep comments by Étienne Schneider, Luxembourg Deputy Prime Minister and Minister of the Economy, at the Informal Meeting of Energy, on 23 September 2015, in Luxembourg. He answered questions about the Volkswagen affair without being able to clarify the matter from EU’s perspective. Luxembourg currently holds the rotating EU Presidency. (European Council – Council of the European Union Audiovisual Services. Snapshot from a video footage, 23/09/2015).

The Volkswagen emissions scam exposed by the US authorities last week has more substance than the vast and varied financial, commercial and legal consequences wherever in the world the company is present. VW has a great weight in the German car universe with its 12 brand names (VW, Audi, Porsche, the Volkswagen trucks Scania and MAN, Skoda, Seat, etc). It’s also a fact that the automotive industry has a tremendous importance in the German economy. One in every seven jobs depends directly or indirectly on it.

As a result, the enormous but still indeterminate consequences of the emissions rigging scandal constitute an unprecedented blow to Germany itself. In reality this affair takes on the dimensions of a top political issue between the US and why not the rest of the world on the one side and Germany on the other. There is no doubt that this is an affair with many tails.

A technical or political affair?

The complexity of the technical aspects, the statistical or the uncertainty that is always present in measurements, the choice of conditions in applying the rules and the timing of the announcement can mould the American ‘discovery’ into a rather calculated hit against Germany’s industrial heart. This can be a clear Washington tracer for Berlin to see. It may be the result of a number of wider conflicts between the two countries around burning issues like Eurozone’s economic policies or the West’s action in Ukraine, the Middle East and Africa.

Mind you that in the Volkswagen case nobody can accuse the US of being biased against Germany. Only lately the Japanese Toyota and the American General Motors conceded to pay $1.2 billion and $ 900 million respectively in fines for technical faults in their cars. In the VW occasion though, there is overt cheating against the US authorities and millions of consumers and a fine that can reach the astronomical amount of $18bn.

Comparing the cases of Toyota and GM with Volkswagen, the former companies’ faulty cars caused tens of deadly accidents, while VW just polluted the environment a bit more. Understandably, an impartial judge may conclude that the US authorities are using double standards in imposing fines. The immeasurable fine of $18bn has already caused VW a loss of one third of its stock exchange capitalization and this is just the beginning. Let’s dig a bit further.

The Americans say they have just discovered hidden software in VW cars which alters pollutant emissions when the vehicle is immobilized while undergoing tests. Whatever questions one may have about the technical aspects of this matter, the truth is that most times the technicalities have never been a key issue in similar cases of international trade as for example in food and food packaging material testing. Usually, the technical determinants and the conditions of the tests are extensively and bitterly fought at the political level between the trading partners. The currently negotiated Transatlantic Trade and Investment Partnership is a most striking proof of that.

VW dignitaries self humiliated

In any case, the full acceptance by the VW dignitaries of the fact that their company by design rigged the emissions tests is so conclusive and final that leaves no room for technical discussions. Actually, this pathetic ritual by the Germans reached self humiliation. It also opens the way to each of the private owners of the affected 11 million VW cars sold in the US to take legal action against the company. Of course this will be an independent legal procedure quite different from the official action against VW that may be initiated in practically every country of the world and before the international courts.

As for the damage to VW’s name, it obviously has a crushing impact on the entire German automotive industry and beyond. It tarnishes the reputation of the ‘Made in Germany’ seal in its entirety. Undoubtedly it also touches the Teutonic ideological assertions about honest and hard work as well as uncompromised clarity of the country’s commercial and economic statements. Not to forget however that the VW case comes after a number of German giants are been condemned for corrupted commercial practices in gaining government contracts in Greece and elsewhere. This new flagrant cheat may definitely destroy the German quality image.

US vs Germany

This US case against VW will have different consequences than the repercussions stemming from the fact that the big German multinationals like Siemens, Ferrostaal, ThyssenKrupp and HDW being condemned for using corrupt commercial practices. Those last cases may be considered as symptoms of a common international illness concerning western companies hunting for government contracts in developing countries. The VW affair though is different because it reveals a carefully panned and engineered swindle intended to cheat millions of consumers and numerous governments around the world.

It’s more than certain then that the Americans will upgrade this case to the highest political levels. It means that Washington will press Berlin on a number of strategic issues in the international arena. This may challenge the German longtime efforts to prevail in Europe and will curb Berlin’s objections against the American plans in the Middle East and elsewhere.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Sustainability reporting: five ways companies should prepare

The Cold War had an unintended side effect: It created a European wildlife paradise

Key elements of the EU-China Comprehensive Agreement on Investment

No more lead in PVC to protect public health, say MEPs

European Solidarity Corps: Commission opens new call for project proposals

4 ways to make your wardrobe more sustainable

Constant rise of COVID-19 in Brazil

MWC 2016 LIVE: Mobile World Congress shows off planes, trams and automobiles

What living abroad does to your self-awareness

This year’s Earth Hour is going digital due to the COVID-19 pandemic

‘Repeated attacks’ could close down key hospital in eastern Libya, says WHO

These social entrepreneurs are lighting up Africa

Questions & Answers on the coordination of measures restricting free movement in the European Union related to the coronavirus pandemic

Texting is a daily source of stress for 1/3 of people – are you one of them?

How to stay in shape and step up support for refugees

Who is first (and last) in the race to build a workforce fit for the future?

Civil Liberties Committee endorses EU Digital Covid Certificate

EU Ombudsman must continue push for more transparency in Council and Commission

Women outliving men ‘everywhere’, new UN health agency statistics report shows

Wednesday’s Daily Brief: mental health, conflict prevention, Ebola in Uganda, Sudan protests, child labour

Questions and answers on the EU’s Arctic Strategy

Taxes on polluting fuels are too low to encourage a shift to low-carbon alternatives

Europe plans to send satellites into space to monitor CO2 emissions

Ukraine pays the price for lying between Russia and the EU

4 steps for looking after our mental health during these unsettling times

The missiles fired against Damascus, Syria divided Europe deeply

More beehives and beekeepers thanks to EU support

Urban Waste Water: Commission decides to refer HUNGARY to the Court of Justice over waste water treatment

These are the world’s best business schools

The Internet of Bodies is here. This is how it could change our lives.

This 12-year-old built an underwater robot to fight plastic pollution

This man is sleeping out in the Davos cold to make a point about homelessness

May a parody constitute a copyright infringement? European Court of Justice to give the answer

Transition between education and employment: how the internship culture is threatening the foundations of our education

LIFE Programme: Member States to benefit from quarter of a billion euros of investments in environment, nature and climate action

Human rights breaches in Iran, Egypt and Tanzania

Why David Cameron’s large victory in UK elections will not pursue a ‘Brexit’

The five stages of the Chief Digital Officer – and why they often fail

UN Security Council urged to act against ‘worst-case scenario’ Syria’s war-battered Idlib

EU revengefully shows no mercy to Cameron by demanding a fast and sloppy Brexit now

Mali: ‘Dire’ humanitarian situation, ‘grave’ security concerns challenge fragile peace

Consumers are getting more complex. Brands need to keep up to survive

Moving from a promise made in Sweden towards hope for peace in Yemen

Antimicrobial resistance: how can an intersectoral approach between society and healthcare professionals be developed and applied?

European Commission: Does Apple, Starbucks and Fiat really pay their taxes?

Can I still send mail in the time of coronavirus?

Countries must make teaching profession more financially and intellectually attractive

LGBTQ+: The social evolution of a minority

A Sting Exclusive: “Climate change-the biggest global health threat of the 21st century, yet overlooked in climate negotiations?” IFMSA wonders from COP21 in Paris

What does the future hold for quantum computing? Experts explain

Does upgrading our minds mean losing the spark of genius?

‘Compelling case’ for urgency around global disarmament, UN-led forum told

Do doctors need to know their patients’ sexual orientation and gender identity?

Mental health In Times of a Pandemic: What can each Individual to lessen the Burden.

Statement by the European Parliament ahead of the 10 April Brexit Summit

Palestinian Bedouin community faces demolition after Israeli court ruling, warns UN rights office

Coronavirus: Commission Statement on consulting Member States on proposal to prolong and adjust State aid Temporary Framework

China’s New Normal and Its Relevance to the EU

European Commission adopts new tools for safe exchanges of personal data

For Youth Rights: steps forward for better protection.

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: