Which Automakers Are Going To Benefit The Most From Dieselgate?

Apr. 15, 2016 5:47 PM ET by Jay Traugott / 34 Comments

Probably not Volkswagen.

The fallout from Dieselgate will remain in the news for quite some time yet. Volkswagen is getting sued by pretty much everyone these days, including its own dealers. Not at all surprisingly, VW has hired a top law firm to represent it and, take this for what it is, has even hinted to governments that if the penalties end up being above what it thinks is fair, mass layoffs could be the result. Nothing like a thinly veiled bit of labor-economic leverage to cut a fine down.

But it's going to take more time for everything to get settled and, eventually, VW will recover financially. Its image, especially among buyers who purchase more environmentally friendly cars, is going to take far longer to repair. Diesel, at least for VW, is dead in the US. That leaves the door wide open for other automakers who'd love nothing more than to lure over those disgruntled and rightly angry former VW owners. Which automakers will benefit the most from VW's screwup? For starters, it's fair to rule out competing German brands like BMW and Mercedes-Benz. Only VW's luxury Audi division competes directly with them and Audi also utilized VW diesels.

In terms of green cars, the BMW i3 is not cheap. Remember, VW buyers are average people with average incomes who still want green cars. GM could be a good alternative, what with two new models aimed directly at these consumers (the Volt and Bolt). Both are affordable and will make for great daily drivers. Ford would also be a nice fit. There's the Focus EV and the entire EcoBoost engine lineup. Then again, the latter are still internal combustion and VW diesel buyers likely won't want that. To them, remember, gasoline engines are the enemy. Ford does offer a few hybrid models, such as the Fusion, but that alone won't make a huge difference. Fiat Chrysler? No chance here. Why?

The Dodge Dart and Chrysler 200 are on the way out because FCA wants to expand its truck and SUV lineup investment. Enough said. The three automakers that'll most likely reap the biggest gains on VW's behalf are Toyota, Nissan, and Tesla. Tesla because, no shit, the new Model 3. Toyota's all-new Prius is very impressive, too. It'll never be an enthusiast's car, nor was it ever intended to be, but Toyota has long been a champion of hybrid and now plug-in tech. There's also the new hydrogen fuel cell Mirai, but at $57,000, that sucker is expensive. Nissan will also soon debut the second-generation Leaf. Despite being ugly it is actually quite beloved by some.

The current Leaf already has an impressively loyal following because it's a pure EV and has a low sticker price. Nissan has listened to owners over the past several years in regards to what they like and don't like about the car, and the redesigned Leaf will reflect that. So in short, disgruntled VW diesel owners are likely going to shift towards automakers that can sell them an affordable, environmentally friendly and efficient car. In other words, many of those people could end up in EVs. It's the next logical step, especially now that EV range has greatly improved. GM and Ford will likely be able to lure over some ex-VW costumers, mainly those who suffer from range anxiety.

But Tesla, Toyota, and Nissan are offering something different. And being different (and green) is what made diesel buyers go to VW in the first place. What would really be interesting is if VW could retain some of its disgruntled diesel lovers by way of the e-Golf. But somehow we get the feeling these people don't trust VW at the moment. Tesla, Toyota, and Nissan will likely benefit from that mistrust.

Which Automakers Are Going To Benefit The Most From Dieselgate?

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