Wednesday, January 18, 2017

Renault Latest Automaker Fighting Emissions Scandal

Renault latest automaker fighting emissions scandal

For the past two years, automotive industry headlines have been dominated by the Volkswagen emissions cheating scandal. Turns out, they were not the only kid trying to get a peek at the test answers.

Renault has become just the latest in a string of automakers who have been caught red-handed trying to cheat the emissions testing system. According to multiple media reports, French prosecutors are conducting a full-scale investigation of the automaker to uncover evidence proving the alleged cheating actually occurred.

And, this time, the case is about more than money. French authorities are claiming Renault’s actions may very well have “damaged public health” while trying to cheat the system. That allegation might be tough to prove, but it will be even tougher for Renault to erase that headline from the mind of French and international consumers.

For starters, of course, the company is denying any and all wrongdoing … at least until evidence, if any, surfaces: “Renault vehicles are not equipped with cheating software affecting anti-pollution systems…”

Notice the very specific choice of words there: “…not equipped with cheating software affecting anti-pollution systems…” There’s many ways that can be taken and many loopholes that can be found in that seemingly straightforward statement. It’s a very specific assertion about a scenario in which several different methods of so-called “cheating” could occur.

The French trading market is definitely not buying Renault’s argument. Trading dropped about four percent after the headlines hit, then bounced back about halfway. Stock will likely drop further if proof of the allegations is found and Renault is forced, as Volkswagen was, to fess up and clean up its act.

The earlier emissions scandal knocked VW off the top of the heap as the biggest automaker in the world. Just to number two, sure, but a drop is a drop, and that’s directly connected to the fallout from the scandal. Now the company is investing billions in making it right, which will take years before they can even begin to make a serious attempt to recover lost PR ground.

Of course, while they are the highest profile offender, Volkswagen is not Renault’s lone partner in crime. In the United States, environmental regulators are currently investigating Fiat Chrysler, after accusing the company of installing cheating software on upwards of 100,000 diesel-powered cars and trucks. Like Renault, Fiat-Chrysler has flatly denied any wrongdoing.

While denying allegations until proven is certainly a sound strategy, it cannot be the only message being sent while headlines are screaming “SCANDAL!” These automakers also need to make a concerted effort to connect with their customers and engender the sort of customer loyalty that could carry them through a rough spot, whether these allegations prove to be accurate or not.

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