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Where Were You When VW died?

I was sitting in Fernandez and Wells, Somerset House, London.

Both Liz (the person I had come to meet) and I were rendered speechless: how could VW have allowed, no willed, this to happen?

It’s known that car companies fiddle with their emissions testing by retuning engines etc but to create a piece of software specifically to cheat the authorities is premeditated fraud. I felt personally betrayed.

And yet, I’m not in the slightest bit interested in cars.

In fact, the only VW I ever owned was a heap of crap I bought out the back of a dodgy garage in 97 – it was unreliable, imbalanced and died after 6 months use. But that didn’t affect how I saw the VW brand because that lives in my mind – I saw myself as the unlucky one to have bought the only bad apple.

The reason I felt that way was because the VW badge has been invested in for decades and embodies trust, honesty and uncompromising attitude to quality. And this isn’t because of their incredible run of ads from the Mad Men Lemon to “symbols”, it’s because of the product experience – the famous build quality and aftercare: these are the guys you can trust.

VW is what you buy your children.

The VW association is what gives a Lamborghini a whiff of practicality to an otherwise wholly fantastical package of peacocking silliness.

The thing is, if this happened to Audi, SEAT, ŠKODA, Bentley, Bugatti, Lamborghini or Porsche (all VW brands) I might be able to rationalise the fraud with their some other tension within their brand like performance, luxury or a low price-point.

But trust is the VW brand. When they conspired to dupe their customers and the authorities, they stuck an axe right through their own car badge.

In a world post-subprime mortgages, post-Snowden and post-Libor, trust is a scarce resource desperately sought by large companies competing against young purpose-driven, customer-centric competitors – and VW was the big company poster child.

The biggest uproar will probably be heard on the VW factory floors, sales rooms and offices.

People proud to have committed themselves to the VW business will have been knocked down many a peg. They’ll have to endure the ribbing from their friends and family. They will hurt the most.

I have no idea what lies ahead for VW but the road to recovery will not be easy. Not because customers won’t forget what happened (as they no doubt will) but because the culture of the VW business will be deeply damaged. And if you believe as I do that organisational culture shapes a company’s ability to be productive, innovative and profitable, then VW is going to be on a go-slow during one of the most potentially critical moments in car history: automation and electric drive.

As Buffet said, it takes a lifetime to build a reputation, and only a moment to destroy it.

It’s a sad moment for a once great company, I wish them a phoenix-like return.

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