Dear Volkswagen: This Was Your Biggest Mistake

Tyler Durden's picture

As we previously commented when it comes to justice, there are those companies that have been bailed out by the US Government, and then there is everyone else. Case in point, GM, which last Thursday was fined $900 million for covering up its faulty ignition switches that caused at least 124 deaths and hundreds of injuries.

The deal with GM was cut by U.S. Attorney for the Southern District of New York Preet Bharara, who said there’s no federal criminal penalty for knowingly putting a deadly product on the market. "It has been a challenging case, for the agencies, for the prosecutors and for me," Bharara said.

As a result, nobody was prosecuted by the US government. 

"I don’t understand how they can basically buy their way out of it," Margie Beskau, whose daughter Amy Rademaker was killed in an October 2006 crash, told the Times. "They knew what they were doing and they kept doing it."

"So much for the Justice Department’s new strong policy on individual prosecution,” University of Maryland Law Professor Rena Steinzor told Corporate Crime Reporter. “This settlement is shamefully weak. A GM engineer knew about the fatal defect even before the first car rolled off the line. He secretly changed the part in 2005 but left hundreds of thousands of cars on the road with the bad switch. GM lawyers conspired to delay the recall. Much harsher penalties and individual prosecutions are warranted. The deferred prosecution is a toothless way of approaching a very serious problem.”

* * *

And then there is Volkswagen, which earlier today took out a record charge of €6.5 billion, one which many think will be insufficient before all it set and done, following its own snafu involving manipulating emissions tests to make its cars appear "cleaner" than they were.

Yes, GM killed people, but Volkswagen killed the air!

While one can debate whose crime is greater, it is quite clear that the punitive damages so far are orders of magnitude apart.

Why? This is precisely what Volkswagen executives, many of whom will lose their jobs in the coming days, are scratching their heads over.

We would like to take this opportunity to explain to them "how it is done" in the US.

 

 

 

How does Volkswagen stack up?

 

To summarize Volkswagen's biggest mistake: it was not poisoning the environment, it wasn't even getting caught. It was this:

 

Source: OpenSecrets Volkswagen and GM

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Freddie's picture

Consumer Reports said Tesla's cars were the best ever made and the best that will ever be made ever.

They are biased as hell.

cheech_wizard's picture

My grandfather worked for FORD (with Henry Ford apparently given the picture of the two of them standing together) and when he passed, grandma could if she chose to, buy up to 3 FORD vehicles at cost.

But basically grandma never told anyone about this until she only had a year or two left to live.

Standard Disclaimer: TRUE STORY, but then again she also claimed that she had bat wings in the attic that she would wear on Halloween to frighten the kids...

Bunghole's picture

Jalopnik is infested by a bunch of millennial douchebags who think they know everything about cars.

post turtle saver's picture

awww, it looks like someone is mad because they lost money on VW...

you mad, bro?

VW's mistake was rigging tests _and_ getting caught... as for laws "killing the air" being more punitive than laws that kill people, that's neither GM or VW's fault... that's just the green and you have to play it as is...

post turtle saver's picture

awww, look at the butthurt flow... bwahahahaha....

Nobody For President's picture

Thanks for the research. Got to keep pounding away at the insane levels of corruption in DC.

kgw's picture

How about those upgraded 20(x4, with steering) nukes the U.S. is sticking down the Germans throats?

http://www.thelocal.de/20120905/44779

BullyBearish's picture

This is the new diplomacy...you want to send a message to a countie's leaders, you shoot down one of their commercial airliners and disappear another one and bankrupt the airlines...you want to make sure a country doesn't become too chummy with your enemy...you attack one of the big players in their main industry with a "regulation bomb" as a warning...

syntheticzero's picture

Political contributions may well be a big factor, but one thing I might point out is that air pollution doesn't merely "kill the air". It's interesting that you, yourself, Tyler, recently posted that Chinese air pollution kills thousands per day, while referring to the VW pollution as merely "killing the air". Keep in mind that diesel cars are far more prevalent in Europe than they are in the US; a simple back of the envelope calculation shows that the amount of additional NOx emitted by VWs due to this deception is on the order of half a million tons per year. Roughly speaking, this may have caused in the thousands of deaths per year, far more than the GM scandal caused.

Ultimately I think the penalties are more related to the fact that the conduct here was obviously extremely deliberate, and the deception on the level of orders of magnitude differences. There's no plausible scenario in which this was just some sort of oversight or mistake --- it was a very deliberate attempt to circumvent regulations. The same may well have been the case at GM, but it was just fuzzy enough to make it a bit less clear cut. Political donations or no political donations, if you're going to try to evade regulations, try to at least be a tiny bit less blatant about it.

KnuckleDragger-X's picture

Money talks...loudly.....

algol_dog's picture

Anybody think of the possibility they had to cheat on those tests? That your looking at like a couple million cars that need major engine upgrades in order to pass ....

imbrbing's picture

And to think, all GM had to do was change out a keyhole and no one dies. I HATE THESE PEOPLE!!!!

Countrybunkererd's picture

Look what they did to Toyota as well.  People didn't maintain their carpets, it gets stuck under the pedals, and suddenly every news agency broadcasts such calamity and venomous hatred for Toyota for weeks and weeks.  Toyota goes to NASA (i guess because Americans still think NASA is great??? Good PR on Toyota i suppose) and NASA finds ZERO fault in any electronics or components regarding Toyota build quality.

The news on NASA's findings...crickets.

Was NASA targeted after that?  Funding cuts, etc.? 

Freddie's picture

It is called a shake down and it is a political weapon against countries.  They did the same thing to French bank BNP.  For selling off US Treasury bonds owned by Russia.

This is a threat to Merkel to not get cozy with Russia, toe the line on the Ukraine and Syria and take in 50 million refugees or else.

RobD's picture

I'm thinking that with the corrected software the engines will pass but they will be dogs. Instead of 60mph or so they will only get 30mph plus they won't be able to get out of there own way. Think 70's super smogged v-sixes here.

Ignatius's picture

"Greatest democracy in the world."

Greatest corruptable democracy in the world.  We got work to do.  FBI whistleblower Sibel Edmonds is currently running a podcast series called Probable Cause and the detail revelations are stunning.  Here's a sample though one must be a subscriber ($50/yr +/-) to get most of the content.  Note that Sibel turned down millions in payoff money to avoid being silenced.  It's all well documented though MSM won't touch it.

Truther's picture

More like the Greatest Fucked Up Democracy in The World.

DutchR's picture

Wait what, the US is not a Federal* Republic anymore..... since when?

And yes there is a big difference between a Republic and a Democracy, we had one to.

 

*hence the Federal reserve, makes it seem real legit, no.

ps.

"The key difference between a democracy and a republic lies in the limits placed on government by the law, which has implications for minority rights. Both forms of government tend to use a representational system where citizens vote to elect politicians to represent their interests and form the government. However, in a republic, a constitution or charter of rights protects certain inalienable rights that cannot be taken away by the government, even if it has been elected by a majority of voters. In a "pure democracy," the majority is not restrained in this way and can impose its will on the minority.

Most modern nations are democratic republics with a constitution, which can be amended by a popularly elected government.

 

Not that it matters anymore

A_Gobshite's picture

The U.S. has the best Government and government agencies money can buy

firstdivision's picture

Funny that if a coporation did the things they do here in another country, they actually can be charged with violating the Foreign Corruption Practices Act.

two hoots's picture

Congrats to the EPA for failing to discover this from the getgo.  Think VW is the only one?

Countrybunkererd's picture

WHO CARES??  The whole global warming thing is 1) a lie 2) irrelevant and 3) a religion.  Truthfully global cooling is what should be of concern, if you are one to worry about those things.  Warming only resets the coastlines and beaches, Cooling on the other hand destroys crops and food production capability.  Besides, data is trending toward cooling, and even with that who really cares? I am very anti-marxist but must say that Climate Change is truly an opiate for the masses.  Standing up against C.C. issues makes them feel part of something larger than themselves, something that the empty souls of the world need due to the void in their hearts by believing their first lie, evolution.

firstdivision's picture

Did the price of your crazy pills exceed your budget?

bbq on whitehouse lawn's picture

How much mass does the sun lose every day? The world is in a carbon bubble? This also will not last.

firstdivision's picture

If you buy his idiotic notion that too much heat is fine for crops, you need crazy pills to.  Additionaly, the sun loses energy, not mass, fucking idiot.

Tall Tom's picture

I guess that you do not understand that Energy is Mass.

 

Einstein's iconic expression, E = mc2, is known as the Mass-Energy EQUIVALANCE statement.

 

Basically the Velocity of Light, c,  is a CONSTANT. Thus the square of the Velocity of Light, c2, must also be a CONSTANT.

 

Thus Energy = mass X "a constant" They are one and the same.

 

LEARN SOME BASIC HIGH SCHOOL PHYSICS.

DutchR's picture

So solar particles are not compressing our magnetic field?

Must be because we are flying trough space in a headwind...

Calculus99's picture

Dumb Krauts. 

Only a moron doesn't understand how to play US politics - Keep the money flowing, whether above board or below, doesn't matter, just keep paying and you've got one hell of an insurance policy.

Don't pay and you're on your own buddy.  

Singelguy's picture

You would think they would have learned that from the Martha Stewart case. She made no campaign contributions and had no friends in Washington and she was shafted. Same story with Microsoft.

max2205's picture

Vw will get the BP treatment 

Moar leverage with Angela M

Next France.....Switzerland, done

Dubaibanker's picture

America is a third world country that works only when the palms of a politician are greased.

Else, the company gets shafted and cannot operate profitably.

Salzburg1756's picture

We Germans love the smell of diesel gas in the morning.

1stepcloser's picture

and here I thought it was the smell of burning Jew flesh...

Fairly_Uncertain's picture

Federal Judges.  What a bunch of slime.

Chuck Knoblauch's picture

Germany, run from israel or fight.

By doing nothing, you're dying.

Falling Down's picture

We clunkered some folks.

Calculus99's picture

Question I've always wondered about America is who first perfected the 'shakedown'?

Did the mob learn from the politicians or did the politicians learn from the mob?

Both have it down to an art. 

 

CL Spec's picture

Trick question. They learned at the same time.

css1971's picture

You seem to have misunderstood the nature of government,. The first feudal lords were the mob. The biggest bastard of them went on to become feudal kings. The head of the "family". Or hadn't you noticed all the in breeding among the aristocracy?

The answer therefore is. The mob and the state perfected it first.

Ides of November's picture

This is good news from last week for German carmaker Volkswagen & Russia.

Volkswagen has announced only last week they will be increasing their ties to Rusdia by using Russian produced engines.

Good news for both Volkswagen & Russia for a prosperous future for both.

https://www.rt.com/business/314820-volkswagen-russia-engine-plant/

Pablo Escobar's picture

How dare those evil Germans save consumers billions of dollars with improved fuel economy and improved performance ! Think of all that tax revenue never collected due to the reduction of gas purchases, never mind the cash flow to the gulf states!

Their crime wasn't killing people, or assisting in combatting global cooling, their crime was against the State, worldwide, a much more serious offense.

How many savvy consumers will refuse to ever take their sippy cup drinking cars back to a VW authorized repair show to avoid the dreaded "repair upgrade"?

falak pema's picture

There is a lot to be said about this comparison as DC is a sewer full of corruption.

But having said that, there is one other aspect of this VW scam which goes way beyond GM incompetence and/or greasing the wheels of power.

There is no proof that GM's defects were the result of WILLFUL MALIGNANCY. In the case of VW its been admitted by the CEO of VW USA !

Willful malignancy, if  proven, changes the weight of damages; that is Law. In this case 20 times more but for much fewer defective cars and much fewer deaths.

Maybe class action will subsequently cost GM more in terms of damages to claimants from families of dead vicitms  resulting from GM's gross technical negligence.

Lostinfortwalton's picture

Yes, it was willful. You can change the part as a "product inprovement" by altering it, you must change the part mumber as well, else how can you track the parts likely to fail if the failures cross a significant threshold? In this case they significantly altered the switch being installed but kept the old part number.

falak pema's picture

appreciate your two comments. Thks.