The CEO of Volkswagen set an ambitious goal: to triple sales in the United States and become
Question:
The CEO of Volkswagen set an ambitious goal: to triple sales in the United States and become the largest car manufacturer in the world. Employees listened carefully because the CEO had a reputation for punishing those who did not make their goals. Then the VW engineers realized that the emissions equipment on the company’s cars could not meet tough U.S. standards. Fixing the equipment would take time, raise costs, and reduce sales. The engineers believed that other car companies had the same problem. Instead of fixing the equipment, an engineer figured out how to install software that would cheat on the emissions tests. Engineers predicted that the chance of being discovered was low, and executives thought the cost of being caught would be manageable. VW produced 11 million cars with this deceptive software. After the company was caught, it spent $18 billion on fines, legal costs, and car repairs. Its sales and stock price plummeted, and it faced criminal investigations. Into what traps did these VW employees fall?
Step by Step Answer:
Introduction To Business Law
ISBN: 9781337404341
6th Edition
Authors: Jeffrey F. Beatty, Susan S. Samuelson, Patricia Abril