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The FIA on implications of the VW scandal

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As the only Philippine affiliate of the International Automobile Federation, which brings together 237 member organizations from 142 countries, the Automobile Association Philippines recently received a FIA statement titled “An Insight on the Volkswagen Scandal and FIA Policy Guidance on the Issue.” Last month, Volkswagen AG admitted that it had programmed the software of 11 million diesel cars worldwide to switch engines to a cleaner mode during official emissions testing, then switch it off afterwards, enabling cars to drive powerfully on the road while spewing as much as 40 times the legal pollution limit.

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The FIA statement is too long to reprint here, but below are excerpts from the section subtitled “Implications.”

Trust is a precious capital and it comes from ensuring a transparent relationship with consumers

In the mobility landscape many of our future challenges are shaped by people’s values, behavior and preferences. Consumers can contribute and play a crucial role in defining consumption patterns and everyone needs to think about ways to influence mass behavior and social norms to promote low-carbon, healthier urban lifestyles. This is why engaging with consumers is key to promoting sustainable patterns. When consumers are put in a position to embrace new technology, then public policy, technological progress, and market success will be mutually reinforcing. Breaking this link can undermine consumers’ trust and compromise the effectiveness of the policy intervention. From the consumers’ point of view, the practices used in the VW case are likely to not be limited to diesel cars and to the emissions, and thus might be used by other car manufacturers. This conclusively results in misinformation of consumers and in deteriorating their trust.

1. Digital technology and the Internet are changing society in some fundamental ways, including how we act as consumers. Consumers value transparency, their expectations are high and tend to grow as the connectivity increases. The automotive industry needs to strengthen trust among consumers, promoting more transparent practices, and work closely with governments to achieve the best outcomes in terms of environmental performance. More transparency leads to more sustainable consumption.

The need for independent consumer programs
The practice of self-regulation within the industry does not contribute to narrowing the trust gap with consumers. Independent consumer testing programs have proven to be extremely effective in improving industry standards and the overall quality of the products on the market. The experience of NCAPs [New Car Assessment Programs] in improving vehicle safety and IRAP [International Road Assessment Program] for road infrastructure safety is unmistakable and has led to impressive improvements in passive safety. Several FIA clubs around the world perform demonstration programs and independent tests to inform their members about the divergence between real-world and claimed fuel consumption/CO2 emission performance as measured by the official test.

This kind of programs, in combination with fuel efficiency labeling schemes, provide consumers with the necessary information not only on the fuel economy measured in testing, but also on the fuel costs associated with operating the vehicle. These can effectively contribute to building consumer trust, as well as to encourage them to purchase the most sustainable products on the market and to stimulate the car manufacturers to provide higher standards.

1. Governments should either create or encourage the establishment of independent consumer assessment programs, as a key element for building trust in vehicle emissions and efficiency performance.

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