Dieselgate haunts VW at Detroit Auto Show | Business| Economy and finance news from a German perspective | DW | 08.01.2016
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Dieselgate haunts VW at Detroit Auto Show

Carmakers from around the globe are presenting new models in Detroit. Volkswagen's new CEO will face competitors and a skeptical US public at a major auto show for the first time since the Dieselgate scandal broke.

The Detroit Auto Show is to the the global car industry what the Oscars are to the movie industry. Glitz and glamor light up Motor City as manufacturers compete for accolades, and give the public a first taste off their latest models and concept cars.

It's party time in the industry: Gasoline is cheap, and car loans are even cheaper. Car sales are up in the US, Europe and China. Last year, some 17,5 million vehicles were sold in the US - a new record in the world's second-largest car market. In the biggest market, China, sales were up by 3 per cent in 2015 and industry pundits estimate they will be up by 5 to 7 per cent at the end of this year.

IAA 2015 Alfa Romeo Giulia

Red hot: Alfa Romeo's Guilia, a 510 horse power compact sports sedan (2015)

Biggin' it in Motor City

Many of the highest-profile 2016 models are in the luxury or muscle car league. With car-buyers' memories of high fuel prices fading, this year luxury sedans, 12-cylinder SUVs, pickups and other fuel-wasters will dominate the show in Detroit.

More and more young urbanites in Western countries simply are not interested in owning a giant impossible-to-park status symbol their climate-conscious friends will diss them for. But that doesn't seem to have played much of a role in carmakers' production planning departments in the run-up to this year's show.

Let's start with Alfa Romeo: The sports car brand is part of US-Italian car conglomerate Fiat Chrysler Automobiles (FCA) and premieres with a new-model four-door sports sedan, under the iconic "Giulia" model name, with an impressive 510-horsepower-engine under the hood.

Not to be outdone in the immoderate force department, Mercedes is presenting a brutastic convertible dubbed AMG S65, choking with power at 621 hp. Germany's luxury brand is also showing its new E-Class models, which have received a thorough face-lift by designers and engineers. They've adopted the swanky look of Mercedes' premium new S-Class. Nice.

But what's with all those huge-engined guzzlers? Climate, schlimate - that seems to be the message. Gasoline gets cheap, and a year or so later, new-model engines bloat like the bellies of poacher-killed rhinos decaying in the African sun. Yeehaw.

A Mercedes assembly line

Mercedes assembly line with S-Class models in Sindelfingen, Germany

Top competitors

Mind you, it's not just the Europeans playing that game. The competition never sleeps - especially in the premium model segment. Cadillac will be showcasing its brand-new CT6 sedan, going on sale this summer in the US as well as on Mercedes' home turf in Germany.

Likewise, US competitor Lincoln, a Ford brand, has its new Continental model on display. The iconic American luxury car looks like a manorial living-room on wheels.

Building fuel-efficient cars seems to be outdated in Detroit. The industry offers all kinds of products these days, from compact to electric or hybrid cars to gas-guzzling SUVs. But pay attention to what people actually buy: in the US, almost every other new car sold is an SUV or a pickup truck.

Sure, there are also compact SUVs like KIA's Sportage, and Toyota's luxury brand Lexus is presenting a new hybrid version of its bestselling RX model, with a grill that resembles a giant mosquito screen. But there's also the Bentayga.

The Bentayga is built by Britain's legendary carmaker Bentley - which is now a Volkswagen Group brand, mind you, but hey, the cars are still made in UK. The Bentayga is being promoted as the biggest, fastest and most expensive SUV money can buy. It's powered by a 600 hp, 12-cylinder 6-liter engine, has a top speed of more than 300 kph, and costs well above 200,000 euros.

Mileage isn't that great - but the target group probably isn't bothered that this rolling altar to the goddess of conspicuous consumption gets only 14 miles per gallon in the city or 20 miles per gallon on a flat summer highway. Climate policy, energy efficiency, conservation - pshaw, that stuff is so middle class. It just doesn't apply to the kind of people who buy Bentleys. Honestly, it just doesn't.

The Bentayga is based on the same platform as the Audi Q7 and Porsche's Cayenne SUV, because like Bentley, Audi's and Porsche's parent company is Volkswagen.

IAA 2015 Bentley Bentayga SUV

British design built on a German platform: Bentley Bentayga (2015)

Volkswagen's publicity crash

Europe's biggest carmaker will also have its core Volkswagen brand represented in Detroit, but after the company's emissions scandal, VW's latest models are not particularly likely to be in the limelight that much.

Michael Müller, VW's new CEO, will presumably be standing on Detroit's center stage, a lonely figure in the Motor City limelight, trying to explain to the American public and industry colleagues how the heck this crazy emissions-fraud thing could ever have happened.

Nobody knows how costly the whole affair will be for Volkswagen's US division in the end. In September, the company had to admit that it had manipulated the emissions data of its diesel-engined models with test-cheating software for years.

The whole world has since been wondering who exactly was responsible for this scam, and how it's possible that those who did it apparently imagined no one would ever notice - or that the benefits of cheating outweighed the risk of getting caught. So far, all this remains a mystery, but investigators are working on it.

USA Auto Autoshow Detroit 2014 Volkswagen

Good old days: VW presents a new model, two years before Dieselgate (2014)

In November, VW's US sales plummeted by more than 30 per cent. In December, VW sold 9 per cent fewer cars in the US than during the same month a year earlier. At the same time, sales of Volkswagen's American competitors surged 6, 8 or 13 per cent, leaving VW looking longingly at their taillights in the booming US car market.

Then there's the tiny little issue of the possible fines and lawsuits - mind-boggling sums in the double-digit billions are being bandied about.

Mea culpa, mea maxima culpa

Earlier this week, VW brand CEO Herbert Diess apologized for the scandal - not the first VW exec to do so, and surely not the last. This thing will take some time to blow over.

"I'm optimistic that we will find a solution, we will bring a package together which satisfies our customers first and foremost, and then also the regulators," he said, while attending the Consumer Electronics Show in Las Vegas.

His boss Michael Müller will probably have to offer more than just words in Detroit.

Give us some of that good ol' zero-emissions long-range affordable electric-vehicle love, VW. That's the kind of boss move the world needs in order to forgive you for your egregious emissions scandal. And no excuses - if Tesla Motors can build beautiful long-range EVs as a California startup, there's no plausible reason in the world why you guys, with the resources of a company that's neck-and-neck with Toyota for the title of World's Biggest Carmaker, couldn't do the same thing, in bigger volumes and with lower unit costs, if you wanted to and just went ahead and did it.


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