Imagine getting caught lying to all your customers…awkward. After the infamous diesel-gate scandal in 2015, Volkswagen was on a mission to redeem themselves.

There's no shortage of VWs on our roads 9 years later, so how exactly were their sins forgiven?

To save themselves from this PR nightmare, VW followed these 4 R’s: Replace, Restructure, Redevelop and Rebrand. This process helped the company turnaround from the turmoil they had found themselves in.

What did the 4 R’s look like for them?

Replace. VW replaced their leadership not once but TWICE. Their former CEO, Winterkorn admitted to the manipulation of 11 million diesel vehicles and resigned in the early months of the scandal. So at the end of 2015, the company replaced him with Matthias Müller.

Müller came in to restore VW to its former glory…until the company got rid of him in 2018. Although Muller did a fantastic job with the rebranding of the company, the company brought in Dr. Herbert Diess to lead them into the next phase of its transformation.

Restructure. Cost cutting was the main part of this restructure. In 2016, VW announced plans to cut 30,000 jobs to reduce costs and recover from the loss of the scandal.

Managers wanted to cut annual costs by 3.7 billion Euros through 2021 to help with this restructure. Then in 2023, VW announced a new cost-cutting program designed to save 10 billion Euros by 2026.

Redevelop. VW needed to redevelop their whole persona and bring the brand into their “authentic” era. They did this by implementing a no-filter approach. Jochen Sengpiehl, CMO of Volkswagen said,  “As a general principle, the aim in future will not be to show a perfect advertising world. In our presentation, we want to become more human and more lively, to adopt the customer’s perspective to a greater extent and to tell authentic stories.”

Rebrand. The last part of VW's strategy was to make their products more sustainable (for real, this time). In fact, they claimed that VW will be the   “world's most sustainable automobile brand”. 

This, of course, meant a mass roll-out of electric and hybrid car models. Volkswagen also announced they aim to have a neutral carbon balance by 2050.

So what can we learn from VW's huge turnaround?

The 4 R’s technique is a great tool to use when you find yourself in a pickle. Remember to define your rebranding goals clearly. Then monitor how it's going and adapt your strategy as you go.

The VW scandal is not only a reminder that unethical decisions have long-lasting repercussions but also there is power in second chances. Everyone makes mistakes. Just don’t repeat them.

-Visha, Intern