Diesel scandal news (Dieselgate) in which Volkswagen fitted defeat devices on cars equipped with the EA 189-engine have appeared in media since September 2015. Sales of affected cars worldwide has led to globally seen consequences. Resulting in prosecutions and bad publicity, highlighting how Volkswagen have deceived their customers. In this thesis I have investigated what effects this scandal has had on Swedish customer’s perception of Volkswagen as a brand. My research method has consisted of different parts. I have received answers from structural questions to journalists, comments from owners and potential buyers online, interviewed customers and also had a dialogue with Volkswagen. I have found that most customer lack trust for Volkswagen as a brand, but their perception of Volkswagens products are generally good. They have throughout the ongoing scandal focused on delivering quality products. This having been the success formula that helped Volkswagen put a shade on “Dieselgate” and focus on the future. “Dieselgate” shows us that trust is not necessarily required to be able to increase sales.

The Dieselgate has changed the public view of diesel powertrains and local authorities have issued first driving bans on diesel cars in Germany. Nevertheless, a systematic calculation of the external costs of the Dieselgate considering different car models and a variety of emissions has not yet been conducted. We compare the results, which reflect emissions under test bench conditions, with those of diesel cars under the assumption that NOX emissions reflect realistic driving behavior. We find that diesel cars with idealized emissions are superior to petrol cars with regard to external costs and that electric cars have only partially lower external costs than diesel cars. However, when realistic driving behaviors are considered, diesel engines constitute the worst powertrain in all cases. Our results show that the Dieselgate has led to substantially higher external costs than cars which would comply with environmental regulations under realistic driving conditions.