Managers always seem to be concerned about being ethical. Ethics can be explained as being a requirement for higher performance and long-term competitive sustainability (Abuznaid 2016). Establishing an ethical environment and a culture that underpins the behaviours of all employees and other stakeholders is a leader’s most important responsibility (Collins 2009). Acting ethically in business is the fundamental requirement for high performance and long-term competitive sustainability. …show more content…
In the US Volkswagens sales decreased 24.7% from what was 23,882 vehicles in November of 2015(Korosec 2015). Kollewe (2016) explained that Volkswagen’s sales finally increased in April 2016 after the scandal was leaked, resulting in Volkswagen having a group market share of 25.2%, dropped from its former level of 26.1%. The scandal also made Volkswagen the headline for widespread negative media exposure, where Popular Mechanics stated that the scandal “is much worse than a recall”, emphasising that Volkswagen had engaged in a display of “cynical deceit” (Dyer 2015).
Following the Volkswagens emissions scandal, Volkswagen immediately took action to respond to the issue, and to the best of their ability, remove the bad reputation that the received from the scandal.
Volkswagen took action in many different ways. The CEO of the Volkswagen Group, Martin Winterkorn spoke at a press conference and said: “I am deeply sorry that we have broken the trust of our customers and the public” (Wolfsburg 2015). However, later Winterkorn resigned from his position. The leader of brand development, Heinz-Jakob Neusser, Ulrich Hackenberg, head of Audi research and development and head of Porsche research and development, Wolfgang Hatz were all suspended (Autoweek …show more content…
VW also created a claims fund, managed by the well-known mediation attorney Kenneth Feinberg, which will offer full compensation packages (in the form of cash, buy-backs, repairs or replacement cars) to the approximately 600,000 United States owners affected by the scandal (Reuters 2016).
Nam (2015) explained that following the emissions scandal in South Korea, Volkswagen put a lot of effort into their marketing after the scandal was brought to the public’s attention. As a result, sales in November 2015 increase by 66%, from the year before, and the units increased by 4,517. The increase in sales was due to discounts for buyers of the Volkswagen vehicles of up to US$15,600. The emissions scandal also didn’t have an impact on the sales in some regions of the world, such as in Great Britain, and in 2016 Volkswagen became the second in the group of best-selling cars (Schmidt