Volkswagen to Become Model for “Integrity & Legal Affairs”
“We are also continuing our intensive efforts to enhance the environmental compatibility of our diesel and gasoline models,” Muller said and then announced another milestone related to the internal combustion engine. “We will successively equip the Group's new TSI and TFSI engines with gasoline particulate filters. This initiative will begin with the 1.4 liter TSI engine* in the new VW Tiguan and the Audi A5 in June 2017. This will reduce particulate emissions by up to 90 percent. Up to 7 million Volkswagen vehicles could be equipped with this technology each year by 2022.”
Recall gathers speed: approval from the KBA (Federal Motor Transport Authority) for more than 3.7 million vehicles
The Federal Motor Transport Authority recently issued approval covering approximately 1 million further vehicles – primarily Golf models. This means approval has now been issued for more than 3.7 million affected vehicles, including the VW Passat, Tiguan and Caddy, all variants of the Golf, the SEAT Exeo and the SKODA Superb plus various Audi models such as the A3, A4 and Q5. “We expect the recall campaign to really pick up speed now. Tens of thousands of vehicle owners will be informed in the next weeks and asked to take their vehicles to the workshops. Our customers can rest assured that we will continue to do our utmost to make every effort to execute the recall campaign as quickly, professionally and satisfactorily as possible.”
He said the Company’s “most important currency” was credibility and trust in the Group’s brands, products and “Volkswagen as a whole”, adding that it was all about regaining the trust lost as a result of the diesel issue. With reference to the current fiscal year, he added: “That does not mean, of course, that we have buried our ambition. Quite the opposite. We do not plan to make it easy for the competition.” The 60 or so innovations that the Group will be launching on the market in 2016 will play a role as well. These include vehicles like the new VW Tiguan, the Audi Q2, the new SEAT Ateca and the Porsche Panamera, “which have been extremely well received and for which we have high expectations.”
Muller also made it clear that “in 2016, too, we will naturally be paying very close attention to our costs. The ongoing efficiency programs are in full swing throughout the Group. And with regard to capital expenditure, we will set the necessary priorities and maintain strict discipline.” However, there was no doubt that “even in difficult times, we will meet our social responsibility to our employees. This is what sets Volkswagen apart from many other companies. And that will remain the case in the future.”
Exploiting revolutionary transformation for profitable growth with Strategy 2015
Muller called 2016 a year of transition for the Company: “However, it will also be a year in which we accelerate the ongoing transformation. In which we set the stage for the future of the Group. In which we lay the foundation for a new, better Volkswagen.” He sees the automotive industry on the cusp of the next big innovative leap. In conjunction with e-mobility and autonomous driving, digitalization will revolutionize the Volkswagen Group’s business to an extent that many people still fail to appreciate. But it is not just the automobile itself that will see massive changes in the years ahead – mobility as a standalone product is being redefined. Noting that this revolutionary transformation opens up tremendous opportunities for the Company, he added: “We plan to harness these opportunities for profitable growth.”
The Company is already laying the foundations for this with TOGETHER – Strategy 2025, the future program that was announced to the public last week. M?ller told the shareholders that the new Group strategy will clear the way for transforming one of the world’s best carmakers into one of the world’s leading providers of sustainable mobility. “We have launched the biggest change process in Volkswagen’s history,” he said, and continued: “In TOGETHER – Strategy 2025, we have formulated a clear vision for the next decade.”Volkswagen to become a model for “Integrity & Legal Affairs”
Regarding the diesel issue, Matthias M?ller assured shareholders that the main thing now was to find good solutions for customers, systematically investigate how the situation could have happened in the first place and, looking forward, to learn from past mistakes and do the right things in the future. The CEO added: “What’s done cannot be undone. But what does lie in our power is ensuring we act in a responsible manner. This is our commitment to you. What unites all of us with a role to play here at Volkswagen – whether it be the Supervisory Board, Board of Management, executives, employee representatives or workers – is the desire to do everything we can to win back trust.” He also stressed the great significance of compliance and integrity for the future of the Group: “What our experience over the last few months has shown is that long-term success is only possible where law-abiding and value-driven behavior forms the basis for our daily actions and decision-making. This principle must and will be anchored more firmly throughout the Group and, even more importantly, be put into practice on a daily basis.” The goal is to make Volkswagen a model of how 'Integrity & Legal Affairs' should be implemented in a modern, transparent and successful company. “In doing so, we are also mindful of the fact that not everything that is legal is also correct,” M?ller said.
In addition to the external investigation by US law firm Jones Day, the second thrust of the overall investigation was an internal audit. This was ordered by the Board of Management immediately after the misconduct came to light. The audit focused on three clusters: processes, reporting and control systems, and infrastructure. Matthias M?ller gave the following explanation: “Based on what we now know, in the past there were certain process deficits in some technical subdivisions in addition to misconduct on the part of individuals. This was true of the testing and release processes for the engine management systems, for example. The audit identified weaknesses and proposed remedial measures.”
The focus now lies on creating more clearly structured and systematic processes. For example, the workflows and structures used for approving the software for engine management systems are being reorganized with more clearly defined and binding powers and responsibilities. Measures include multi-stage approval processes, an extended “four eyes” principle, clear functional separation between development, approval and quality assurance, and escalation procedures in the event of problems.