The car industry has been changing in recent years, and not just because of the shift to alternative fuel and hybrid vehicles. Multiple cases of systematic fraud have also played a role in exposing issues with the industry; forcing changes to be made.
More recently, Volkswagen has been at the heart of one of these scandals. Cars have to be made to pass specific emissions tests, and Volkswagen found a way around those tests with its diesel-powered cars. To fool the tests, the company deliberately used hidden software that would trick the sensors.
The impact on the company is undeniable. It stands to reason that there will be many lawsuits in the coming years. The company may have to pay fines amounting to billions of dollars. Even now, the stocks have been plummeting, dropping by around one third, since consumers found out what happened.
It’s even been mentioned that the reputation for reliability and trustworthiness of all German products could take a hit due to this scandal.
This type of consumer deception isn’t limited to VW, though. An airbag maker called Takata knew there were dangers with its products more than 10 years ago, though they didn’t come to light until now. General Motors knew about the issues with ignition switches years before they were officially discovered, and 124 people died as a result–leading to $900 million in fines. Last year, Toyota settled for $1.2 billion because of acceleration issues, and as a result, vehicles in Canada and the U.S. were recalled.
When consumer deception leads to injuries and financial losses, it’s important for consumers to know what rights they have regarding class action lawsuits.
Source: The Economist, “A mucky business Systematic fraud by the world’s biggest carmaker threatens to engulf the entire industry and possibly reshape it,” accessed Oct. 29, 2015