Volkswagen cancels or suspends all projects deemed unnecessary

Volkswagen’s Dieselgate scandal is obviously hitting hard, so hard in fact that Wolfsburg’s own announced the cancellation or suspension of all projects deemed unnecessary for the company’s future.

This is a major move to help the company reallocate its resources to amending the damage set forth from their mistakes from cheating on emissions tests both in Europe and North America on a wide-range of diesel-powered passenger cars. It also means many of the possible and exciting new product prospective considered excessive or low on priority will be canned or put on hold since the company has to focus on fixing this major diesel issue.

“We can and we will overcome this crisis, because Volkswagen is a group with a strong foundation. And above all because we have the best automobile team anyone could wish for,” Volkswagen CEO, Matthias Muller said in his statement.

Volkswagen’s still heavily investigating what could possibly one of the largest, if not the largest, automotive scandals in all of history where engineers programmed deceptive software into the engine control units of many 2.0L TDI-powered models to cheat on emissions tests.

Additionally, because of the projections as to how much money this would cost Volkswagen as a whole, the company can no longer sustain projects that simply don’t promise to return strong profits.

For the press statement, check it out below.

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MATTHIAS MÜLLER: “WE WILL OVERCOME THIS CRISIS”

  • Group CEO addresses Wolfsburg employees at works meeting
  • Müller announces swift and relentless clarification of emissions scandal
  • Müller: “We will do everything we can to ensure that Volkswagen continues to stand for good and secure jobs in the future”
  • EU6 diesel vehicles comply with legal specifications and environmental requirements
  • Technical solutions for customers are imminent
  • Care is even more important than speed – Müller: “We are dealing with four brands and many model variants”
  • Efficiency program to be intensified – further critical review of all planned investments

Speaking at a works meeting in Wolfsburg today the CEO of Volkswagen Aktiengesellschaft, Matthias Müller, promised employees “swift and relentless clarification” of the emissions scandal. He said that what had happened went against everything the Group and its people stand for and that there was no excuse. At the same time he encouraged employees to take heart: “We can and we will overcome this crisis, because Volkswagen is a group with a strong foundation. And above all because we have the best automobile team anyone could wish for.” He added that the company would do everything it could to ensure that Volkswagen continues to stand for good and secure jobs in the future.

Speaking to more than 20,000 employees in Hall 11 at the Wolfsburg plant, Müller made it clear that “apart from the enormous financial damage which it is still not possible to quantify as of today, this crisis is first and foremost a crisis of confidence. That is because it is about the very core of our company and our identity: it is about our vehicles.” Müller went on to say that solidity, reliability and credibility belong to the essence of the Volkswagen brand: “Our most important task will therefore be to win back the trust we have lost – with our customers, partners, investors and the general public.” According to Müller, the first step toward achieving that was swift and relentless clarification. “Only when everything has been put on the table, when no single stone has been left unturned, only then will people begin to trust us again,” Müller said.

The CEO asked employees for their understanding, saying that he, too, did not yet have the answer to many questions: “Believe me – like you, I am impatient. But in this situation, where we are dealing with four brands and many model variants, care is even more important than speed.”

Nevertheless, he announced that a project team had drawn up an action plan. Over the coming days, the customers affected would be informed that the emissions characteristics of their vehicles would be upgraded. Furthermore, the company has set up websites where customers can check whether their vehicles are affected by entering the chassis number. The company will shortly be presenting the technical solutions to the responsible authorities – in particular the German Federal Motor Transport Authority (KBA) – for approval. Müller said: “In many instances a software update will be sufficient. Some vehicles, however, will also require hardware modifications. We will keep our customers constantly informed about the measures and arrange workshop appointments.”

The Group CEO also emphasized that all of the vehicles in question are technically safe and roadworthy: “At no time was the safety of our customers compromised. And above all: all EU6 diesel vehicles comply with legal specifications and environmental requirements. For Wolfsburg, that means production can continue.”

On the other hand, Müller did not omit mentioning that “while the technical solutions to these problems are imminent, it is not possible to quantify the commercial and financial implications at present.” He added that the company must now respond swiftly: “That is why we have initiated a further critical review of all planned investments. Anything that is not absolutely necessary will be cancelled or postponed. And it is why we will be intensifying the efficiency program. To be perfectly frank: this will not be a painless process.” However, he also gave employees reassurance: “We will do everything we can to ensure that Volkswagen continues to stand for good and secure jobs in the future.”

Müller added: “At the IAA we demonstrated that the Volkswagen Group is well positioned when it comes to the key technologies of the future. We cannot afford to jeopardize this strong position now. We must make massive savings to manage the consequences of this crisis. At the same time, though, we cannot afford to economize on the future. That is something else we will also be addressing over the coming weeks and months.”

Müller pointed out that not all the facts were on the table yet. One conclusion, however, was already clear: “Volkswagen must once again stand for more integrity. Not just on paper. But anytime, anywhere. We will make every effort to make very sure that the rules are respected by everyone. This Group and its brands stand for sustainability, for responsibility, for credibility. At the moment, much of that seems to have been deeply shaken. But: together with you, I am determined to prove that our values remain our guide. And that Volkswagen, that each one of us, deserves the trust of people everywhere.”

– By: Chris Chin


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