business news in context, analysis with attitude

by Kevin Coupe

Volkswagen continues to offer object lessons in how to subvert brand equity, how to mismanage a crisis, and why every business leader needs to watch Jurassic Park.

The brand equity issue? Well, the Financial Times reports this morning that Volkswagen-owned Audi "has conceded that the engines in a further 85,000 cars ... contained an illegal defeat device, raising questions of how systematic the cheating was at the German carmaker."

According to the story, "admitted that the software was in all three-litre V6 diesel engines manufactured by Audi and sold from 2009 until this year."

The crisis mismanagement? "The admission further undermines VW’s insistence that the cheating in the two-month-old emissions scandal was limited to a rogue group of engineers," FT writes. "The German carmaker has already admitted installing a defeat device in 11m diesel cars worldwide.

"It is also facing a third emissions problem after disclosing that 800,000 cars, including some with petrol engines, had been sold with the stated carbon dioxide levels as too low and the fuel efficiency too high."

In other words, it lied. And then kept lying about the lies.

The story not only won't go away but continues to get worse.

I don't know about you, but when I see VW and Audi commercials on TV, I have to laugh. Who would believe anything these people say?

Longtime MNB readers know exactly why we believe that every business leader needs t watch Jurassic Park ... it is for the movie's essential business lesson ... that just because you can do something doesn't mean you should do something.

Keep watching the VW debacle. It is an Eye-Opener ... albeit for all the wrong reasons.
KC's View: