Volkswagen Prank Not Just Fun and Games

volkswagen prank not just fun and games

As you know by now, Volkswagen pulled the wool over the eyes of the automotive media, the business media, and the general public in a terribly executed April Fool’s Day prank over the past few days.

The company may have done more than anger a few people — it may have run afoul of regulators.

It’s one thing to have journalists and car enthusiasts angry on Twitter. VW could brush that off easily enough. But according to the Associated Press, Volkswagen may be in trouble because its fake statement moved the market.

From the AP:

“The fake release could land Volkswagen in trouble with U.S. securities regulators because its stock price rose nearly 5% on Tuesday, the day the bogus statement was officially issued. Investors of late have been responding positively to news of companies increasing electric vehicle production, swelling the value of shares of Tesla as well as of some EV startups.”

James Cox, a professor of corporate and securities law at Duke University, told the AP that the Securities and Exchange Commission should take some sort of action against VW. He said this kind of misinformation can cause the market to be warped.

“The whole market has gone crazy,” Cox said in the article. “We need to throw a pretty clear line in the sand, I believe, about what is permissible and what isn’t permissible.”

The article then reminds us of Tesla CEO Elon Musk’s shenanigans in 2018 when he tweeted that he had funding to take the company private. He, of course, had no such funding lined up, and Musk and Tesla both agreed to pay $20 million in penalty fees.

On the other hand, maybe VW has no reason to worry. Another professor, this one a business and law professor at the University of Michigan, points out that for the SEC to penalize VW, the company would’ve had to have been knowingly trying to manipulate its stock price, as opposed to using an incredibly terribly executed April Fool’s gag to market electric vehicles.

This gentleman, Eric Gordon, then gave the AP reporter one of the better quotes I’ve seen today (it’s early, though): “I don’t think the SEC is going to see this as stock price manipulation any more than when General Motors or Ford or Toyota or anybody talks about their (electric vehicle) future,” Gordon said. “It is incredibly stupid, but if being stupid were illegal, a third of the CEOs in the U.S. would be in jail.”

As I wrote yesterday evening, it’s common for companies to perform April Fool’s Day pranks. It is very uncommon for companies to deliberately lie to reporters when asked to confirm if a prank is actually a joke.

Especially a company like VW, which has that whole diesel-emissions scandal baggage hanging over it. While it may seem like it happened ages ago, that scandal became known to the public less than six years ago.

I’ll close it out with one more quote from the world of academia via the AP: “The problem is that in the short run, you can fool people, and it seems cute and entertaining. But in the long run, you really do need positive and good relations with the media. For a company that already has credibility problems, this is really a strange move,” said Tim Calkins, a clinical professor of marketing at Northwestern University.

April 2 can’t come soon enough.

[Image: [s]Voltswagen[/s] Volkswagen]

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  • Scoutdude Scoutdude on Mar 31, 2021

    Truely hilarious, so the AP reporter found a professor that supported what they wanted to write, though at least they had the decency to include the other side too. “The whole market has gone crazy,” Cox said. On this point he is correct but it is the market that has gone crazy, ie the investors that are crazy. The fact that shares moved up 5% as this got around proves that there are a lot of irrational investors in today's market. Unfortunately those irrational investors frequently drag the rational ones along with them. The fact that the stock price did see a nice movement upward does point to the fact that this stunt was very successful in getting VW wide ranging press and more than a couple of people thought it was a good thing.

  • Lou_BC Lou_BC on Mar 31, 2021

    Looks like the stunt worked. Share price is up and people still talking about it. As far as maintaining a good relationship with the media, the past cheeto-in-chief stoked a negative relationship to his advantage. If "serious" journalists just walked away, this would have died a quick and quiet death.

  • FreedMike Back in the '70s, the one thing keeping consumers from buying more Datsuns was styling - these guys were bringing over some of the ugliest product imaginable. Remember the F10? As hard as I try to blot that rolling aberration from my memory, it comes back. So the name change to Nissan made sense, and happened right as they started bringing over good-looking product (like the Maxima that will be featured in this series). They made a pretty clean break.
  • Flowerplough Liability - Autonomous vehicles must be programmed to make life-ending decisions, and who wants to risk that? Hit the moose or dive into the steep grassy ditch? Ram the sudden pile up that is occurring mere feet in front of the bumper or scan the oncoming lane and swing left? Ram the rogue machine that suddenly swung into my lane, head on, or hop up onto the sidewalk and maybe bump a pedestrian? With no driver involved, Ford/Volkswagen or GM or whomever will bear full responsibility and, in America, be ambulance-chaser sued into bankruptcy and extinction in well under a decade. Or maybe the yuge corporations will get special, good-faith, immunity laws, nation-wide? Yeah, that's the ticket.
  • FreedMike It's not that consumers wouldn't want this tech in theory - I think they would. Honestly, the idea of a car that can take over the truly tedious driving stuff that drives me bonkers - like sitting in traffic - appeals to me. But there's no way I'd put my property and my life in the hands of tech that's clearly not ready for prime time, and neither would the majority of other drivers. If they want this tech to sell, they need to get it right.
  • TitaniumZ Of course they are starting to "sour" on the idea. That's what happens when cars start to drive better than people. Humanpilots mostly suck and make bad decisions.
  • Inside Looking Out Why not buy Bronco and call it Defender? Who will notice?