VW, GM bruised but wiser after crises

The two automakers that will be featured on the front page of Monday's issue share a link that could scarcely have been imagined a decade ago.

They both have gone through self-inflicted crises that have cost billions of dollars and untold sums of goodwill while sparking massive, internal probes into the cultural flaws that allowed the messes to unfold.

At General Motors, it was the ignition switch crisis that landed on the doorstep of CEO Mary Barra just as she took over took in early 2014.

A few months later, the California Air Resources Board would detect abnormal amounts of diesel emissions during a road test of Volkswagen vehicles, confirming findings by researchers at West Virginia University. The discovery triggered a sequence of events that culminated in a bombshell announcement five years ago this Friday.

That's when the EPA disclosed that VW and Audi had sold about a half million diesel cars with illegal software designed to pass lab tests even though the cars were heavy polluters on the highway.

Within days, CEO Martin Winterkorn would be gone and VW would be on a wrenching path that brings us to today. We give a status report in one of the Page 1 stories noted above.

Along with it is an interview with Hiltrud Werner, pictured above, the VW Group executive board member responsible for integrity and legal affairs. In a remarkable Q&A (which subscribers can view here today), she discusses the enormity of the job in transforming the company into a "model of integrity."

"We paid more than €30 billion to learn our lesson," she says.

And she speaks as though the job is just beginning.

"Every department can potentially be the source of a scandal," she says. "The next time it could be an antitrust issue, or money laundering or falsifying financial reporting figures, or bribery in procurement."

The effort is among a number of marks of a new Volkswagen. So, too, is the embrace of electrification.

GM is also on an EV course. And with it comes a new approach to partnerships.

We’ll explore that in the other Page 1 story in Monday’s edition, which includes this quote from Morningstar analyst David Whiston on GM’s alliance with Honda: “A Japanese automaker [is] coming to an American automaker saying, ‘We need your expertise.’ I think that’s pretty cool.”

Count that among other things that could hardly have been imagined 10 years ago.

— Dave Versical

Coming Monday in Automotive News:

Volkswagen’s clean break from a dirty past: VW’s U.S. market share is back to where it was in the days before its $33 billion diesel emissions scandal exploded in public view on Sept. 18, 2015. It soon will turn another page on its felonious past as it introduces the ID4 electric vehicle. But more than just time has healed VW’s self-inflicted wound. Gobs of money also helped restore the German brand’s U.S. operations. Automotive News looks at how VW has emerged five years on from its crisis.

Catching up with the locals: Global automakers have long lagged Chinese brands in introducing EVs to the home market. But they are catching up fast. General Motors, Volkswagen, Toyota and Nissan will take the opportunity of the Beijing auto show this month to showcase their newest EV models. Automotive News, in its show preview, will take a look at future vehicle electrification strategies for the market.

Weekend news:

Continental antitrust suit against telecoms dismissed in U.S. court: A technology licensing pool formed by Qualcomm, Nokia and other tech patent holders isn’t violating antitrust laws when it negotiates license agreements with automakers rather than suppliers, a federal judge ruled.

GM, Nikola alliance: General Motors and electric truck startup Nikola Corp. said they will form a partnership that will see the automaker engineer and assemble Nikola’s first vehicle, the Badger, using GM’s proprietary Ultium batteries. GM will take an 11 percent stake in Nikola as part of the deal.

Nissan’s revival chief to lead North America: The executive leading Nissan’s global revival plan, Ashwani Gupta, will personally oversee North America as chairman of a new five-member regional board. The move is meant to provide closer oversight and communication as Gupta tries to move the U.S. sales strategy away from chasing volume and toward pursuing profit.

How one dealer is prioritizing mental health for employees: After losing his brother to suicide in 2015, West Michigan dealer Jeff Elhart set out to provide mental health resources for his employees and customers. Elhart is now accelerating those efforts amid the coronavirus pandemic by creating a "safe place" for those battling emotional issues and illustrating how two simple words can identify depression and save lives.

A selection from Shift and Daily Drive:

Sept. 14, 1964: Thirteen prototypes of the Porsche 901 are built at Porsche’s Zuffenhausen factory in Stuttgart. Since Peugeot already owns the rights to three-digit vehicle names with a zero in the middle, Porsche is forced to rename the model range the 911. Today, the Zuffenhausen campus, which has been rebuilt and expanded, builds Porsche’s two-door sports cars and the Taycan battery-electric sedan.