Volkswagen Manufacturing and Business Ethical Issues

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Volkswagen is a car manufacturer that sells automobiles all around the world. However, US regulators have noticed that some of the company’s claims regarding emissions may not be truthful. The cars have been examined, and the examiners found that the engines were programmed to detect when tests are being performed and show better results. It is essential to evaluate the ethical issue in regards to egoism, which is one of the five major ethical systems. While the failure of the emission tests has been a significant concern for possible customers who disagree with the company’s ethical approach, there are solutions to these problems. Virtue ethics and relativism are the systems that would allow the company to redeem itself and have better future results.

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The Ethical Issue. Egoism

Volkswagen’s ethical concerns have been compromised by the recent scandal when the company has cheated during emission testing. Certain detectors were introduced in the cars, and the system was aware of tests being performed. This incident is a reflection of ethical egoism, which is one of the systems that companies use to create a general idea of how the corporation has to perform on the market and what the ethical goals are.

In regards to ethical egoism, the organization is most concerned with self-interest and positive outcomes. It is vital to highlight that egoism is not always a negative ethical trait. Moreover, multiple companies benefit from having an egoistical approach. According to researchers, leaders who practice ethical and rational egoism are able to create a favorable environment for their companies (Overall & Gedeon, 2018). However, in this situation, egoism has reflected in lies and controversies.

The egoistic approach is evident since the scandal was based on the company’s desire to appear more environmentally friendly to appease certain organizations and stakeholders. However, in this particular case, the egoistic ethical dilemma has caused major problems in terms of regulatory norms that have been compromised. Any company has to have a certain degree of self-interest and self-preservation aspects of business behavior.

Volkswagen, however, has not taken into consideration virtue ethics because the actions have caused environmental damage. Moreover, lying to customers and regulatory specialists is a tactic that negatively perceives the corporation as an unreliable supplier of goods that cannot be trusted. An egoistic ethical approach may lead to impaired relationships with customers who think Volkswagen representatives are not interested in giving them quality services but solely focus on profit.


Volkswagen’s reputation has suffered damages after the controversy. Such a powerful global corporation needs to have a strong reputation because customers want to trust a car company before making a purchase. Moreover, adequate ethical systems within automotive corporations are significant because of the safety concern individuals have when it comes to buying something as important as vehicles. In this case, the only adequate solution is addressing the issue using virtue ethics. Volkswagen has to apologize to customers and allow returns if individuals feel like the corporation has acted unreasonably. Moreover, it is important to let people know that these scandals will no longer occur since Volkswagen will have a more transparent policy.

Moreover, Volkswagen can use ethical relativism when dealing with regulatory issues. For example, if one country has a particular approach to environmentalism, the company may introduce cars that are appropriate for these particular implications. If certain countries are not as strict in terms of regulations, Volkswagen cars do not have to be as environmentally friendly. Having a relative and virtuous ethical approach is a beneficial ethical system that would solve these problems and prevent such controversies from impairing the company’s reputation.

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Feasibility of the Solution

Having a more transparent policy does not require any investment or extra expenses on Volkvagen’s part. However, applying a relative ethical approach in terms of specific regulations being respected based on the country where the cars are being sold requires investments. This, however, is a beneficial strategy that can also be profitable long-term. The extra expenses that the corporation has regarding improving all the automotive put on the market can be minimized. For example, the cars sold in countries where the regulations are strict will require additional investments. However, the rest of the products will not be altered because the countries where they are sold are not as uncompromising in regards to regulatory implications.


Volkwagen’s egoistic ethical approach has created a controversy that negatively affected their reputation. However, having a more relative and virtue-based ethical system will minimize the effects of the problem and create an environment in which the issue will not appear again. This will require the company to be more transparent with all the stakeholders, invest in improvements for cars sold in countries with strict regulations, and inspect the market for regulatory purposes. This ethical approach is favorable for the customers and the economic, reputable, and strategic domains of Volkswagen as an international corporation.


Overall, J., & Gedeon, S. A. (2018). A rational egoism approach to virtue ethics. Business and Professional Ethics Journal, 38(1), 43–78. Web.

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BusinessEssay. "Volkswagen Manufacturing and Business Ethical Issues." September 12, 2022.