Faster, Higher, Farther: The Volkswagen Scandal

 

Jack Ewing, W.W. Norton, 352 pages, $27.95.

When an American police officer pulled over a Volkswagen Jetta in 2013, he suspected that the array of pipes sticking out of the back of the car and the gray box and portable generator in the vehicle were a sign of something fishy. He was right. The West Virginia University researchers inside the car had nothing to hide. But the tests they were conducting on the exhaust fumes, meant to prove the cleanliness of modern diesel engines, uncovered one of the biggest and boldest frauds in corporate history. The decision by VW, a pillar of Germany’s car industry, to fit “defeat devices” and cheat emissions tests in as many as 11 million cars has so far cost the company $21 billion in fines and compensation in North America alone. Jack Ewing, a journalist for the New York Times, offers a timely guide to the scandal, setting out in detail why VW’s corporate culture led to the deception. He delves into VW’s origins and how unprecedented union power, handed over in the 1960s as the price the federal government paid for floating the firm on the stock market, and the sway of the state of Lower Saxony, which retained a 20 percent voting stake in the company, gave outside shareholders little say. This allowed autocratic bosses to have their way. He explains how executives wanted the firm to become the world’s biggest carmaker, how he had to win the U.S. market to do this and how that led to the cheating scandal. With company changes still happening and a criminal case unfolding, Ewing’s tale will need a new edition with extra chapters.

ECONOMIST