Pain and Gain Behind the VW Scandal


Our member in Dusseldorf says the VW scandal may bring a global icon to its knees, but business goes on.

One of the big topics of late has been the huge scandal with Volkswagen. This has been a topic not only in interviews that we do but also with our clients. The big question for everyone is, how will this affect us?

Volkswagen Car Maker Logo On A Building Of Czech DealershipOne client, an automotive supplier, had a very quick and distinct reaction to the scandal. He said:

  1. This was definitely going to hurt Germany’s reputation as a technologically advanced and trustworthy source.
  2. VW is going to have to make huge efforts to save costs. This cost saving is going to be on the backs of the suppliers.
  3. While the immediate effect is not apparent, it is expected that this scandal is going to hurt VW’s market share in the longer term.
  4. The scandal has the potential of bringing the auto maker to its knees considering all the law suits that are piling up.

The reaction of this client was interesting however: They gave us two projects to find business development managers – one for automotive and one for industrial. So far this supplier had been reliant on VW. They quickly wanted to broaden their customer base to escape some of the potential fallout!

The next point is,  a number of senior people at VW have left. I am not only talking of Martin Winterkorn. I am talking of people in the second and third level of management. They have seen the writing on the wall and want to quickly move on to greener pastures before being caught up in the mess.

So if you are looking for some experienced people, now is probably a good time to be talking to some candidates from VW!

To summarize: Germany is profoundly moved by this scandal. It has shaken up the image the Germans have of themselves (some call it arrogance) as being clean, proper, scientific etc.

Add to this the recent speculations of corruption in the German Soccer Federation regarding the award of the World Series in 2006 by FIFA and Germans have had a difficult few months regarding their self-image!

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