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Car and Driver: VW Updates Diesel Progress, Outlines Corporate Changes

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Cautiously optimistic news came out of Wolfsburg today as VW’s top management gave an update on its diesel cheating scandal, and announced sweeping changes to the corporate culture and strategy. This is what we took away from today’s press conference and Q&A session:

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– “Volkswagen won’t break,” said CEO Matthias Müller. But the company will be less centralized. The company’s Airbus will be sold (giving executives a chance to spend more time in airport security lines), and there will be less travel overall.

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– 450 experts are working on getting to the root of the emissions scandal. They have conducted 87 interviews and are poring over data.

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– VW will present a comprehensive report at its shareholders meeting on April 21, 2016. But investigations will continue beyond that.

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– In 2005, it had proven technically impossible to meet U.S. emissions targets, and the cheating software was installed. Later, even though there was a technical solution, the cheating software was modified, and on-road emissions were higher than they needed to be. This suggests that for the later cars at least, a fix might be relatively easy.

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– VW is “cooperating closely with the United States Environmental Protection Agency (EPA) and the California Air Resources Board (CARB)” to fix past problems and certify future cars, says the company.

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– In Europe, the NOX emissions fix will be conducted throughout 2016. The 2.0 liter TDI models will be recalled beginning in January. Models with the 1.2 liter TDI will be recalled starting in the second quarter. And cars with the 1.6 TDI, which needs hardware changes rather than just software modifications, will be recalled beginning in the third quarter.

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– Meanwhile, suspicions of cheating on CO2 emissions in Europe have been largely dispelled. Of the 800,000 cars initially identified, it turns out that the aberrations affect only 36,000 cars. What happened? Overzealous engineers, encouraged by the company’s new “whistleblowing” policy, had alerted top management of the potential misconduct.

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– Müller promises “a new way of thinking,” including “more open discussions, closer cooperation, and a willingness to allow mistakes”—but only, of course, “if they are understood as an opportunity to learn.” In Müller’s words: “We don’t need yes-men.” And in a nod to America, he said, “We need a little more Silicon Valley.”

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Finally, VW is working on a “strategy 2025,” to be disclosed in mid-2016. It will target the company’s challenges and likely bring a realignment of the brand structure.

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