VW's state of emergency

As I brought my Volkswagen into the repair shop, the mechanics attending to my car were unusually enthusiastic. I was only coming in to have winter tires fitted. They said it was a welcome change from the customer service disaster in which they've found themselves. The telephones were ringing endlessly. But none of the mechanics really had any answers right now, they said; they could only try and calm down customers.

That's a good description for what's happening with Europe's biggest carmaker. It's as if a gigantic boulder has fallen into the water, and now Volkswagen's top management is trying to get the resulting giant waves under control. Not with heavy machinery, but with a small sandbox scoop.

A lot has happened by now - Volkswagen's chief is no longer called Martin Winterkorn, but Matthias Müller. Three technical heads have been suspended, internal restructuring is ongoing and a US law firm is going over the company with a finetooth comb in search of guilty parties. There's a new supervisory board chairman, but that was necessary anyway. The head of Volkswagen in the US had to testify this week in front of the US Congress. State prosecutors are searching Volkswagen facilities all over the country.

Defrauding, disguising and deceiving

We still don't know much more than we did three weeks ago. But everything we have found out since then has made the situation worse. For example, we learned that the defeat device wasn't only built into models sold in the US, but also in Europe. Because the device was installed on millions of cars at one point. But as it emerged that the software had to be specially programmed and adjusted for every model, then it became increasingly clear: this wasn't about a small secret circle of engineers working at all costs to fulfill a directive from above: to finally make diesel "clean" for the US market. No, this was about a a refined system of defrauding, disguising and deception. But the question remains: how many people knew about this, and how high up were they?

The longer Volkswagen waits to release official reports, even preliminary ones as to the current state of affairs, the bigger the probability that we will have to prepare ourselves for an explosion. Apologies in the US, and in German newspapers, accompanying promises to do everything to win back trust - these all ring hollow as long as no names are named.

Volkswagen is no stranger to scandal. There was the affair surrounding Jose Ignacio Lopez, who was recruited out of Opel by Ferdinand Piech in 1993. Unwisely, he left Opel with classified documents from General Motors. Volkswagen had to pay $100 million in fines and buy car parts from General Motors for around $1 billion.

Starting in 2005, Volkswagen was rocked by a sex-and-bribery scandal. Former employee representatives and executives faced off in the courts. And then the now legendary - and very public - power struggle between Ferdinand Piech and Martin Winterkorn, which only took place half a year ago.

Bad timing

Compared with dieselgate, all those scandals seem like walks in the park. Nobody can put a price tag on the damage to Volkswagen. The wave of legal troubles has only just started. The patience of affected car owners will be severely tested. Details haven't been released yet, but the recalls will probably take all of 2016 to complete. Some will wonder whether their next car should come from another company.

This is all coming at a time, where billion-dollar heavyweights like Google and Apple are planning to send self-driving cars to the streets. It's also a time where the industry finds itself in the midst of a historic upheaval, as ex-boss Winterkorn said just a few weeks ago. Just as an aside: Apple's warchest has around 180 billion euros. That's enough to easily buy VW in its current state. But Apple probably wouldn't do that. I can imagine that Wolfsburg would be much too boring for those used to Cupertino.

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