GM Wants To Fill The Gap Volkswagen's Dieselgate Scandal Left

In June 2014, General Motors CEO Mary Barra stood stern-faced in front of her employees and a battalion of cameras and said: “I never want to put this behind us.”

The Detroit auto giant had admitted to selling cars with faulty ignition switches that caused the vehicles to turn off without warning in the middle of driving. At least 124 people died in accidents caused by the defect.

Since then, the company has taken pains to refurbish its image. GM invested $500 million in the ride-hailing startup Lyft the “nice guy ” runner-up to industry goliath Uber and vowed to help it build a fleet of self-driving taxis. It committed last week to running 100 percent of its operations with renewable energy by 2050. It poured money into electric vehicles, enough to beat Tesla Motors at its own game, bringing the first affordable, mass-appeal all-electric car to market. 

Now, GM plans to tap a market left wide open after the biggest auto industry scandal since its own infamous ignition switch failure. Last week, the automaker announced plans  to offer a diesel option with the 2018 model Chevrolet Equinox, its best-selling small sport utility vehicle. The move comes a year after Volkswagen, the world’s largest automaker by sales, admitted to cheating on U.S. regulatory tests for its diesel cars, which spewed 40 times the legal limit of smog-causing emissions into the air.

The German auto giant agreed to pay a record $14.7 billion to settle with the U.S. government. Last month, the Department of Justice announced a plea deal  with an engineer who designed the engine workaround. Unlike any executives involved in GM’s scandal two years ago, he may now face jail time.

Both incidents implicate companies that took fatal risks by sending to market products that weren’t quite ready. Volkswagen failed to design a diesel engine that could meet U.S. standards, so it cheated, causing, according one study , up to 60 premature deaths. GM, fearing an expensive recall, continued to sell faulty cars for nearly a decade after discovering the flaw. 

Popular in Europe, diesel which is roughly 30 percent more efficient than gasoline has struggled to catch on in the United States. Diesel-powered vehicles made up just 3 percent of total U.S. sales in 2014. Volkswagen made up about half of them, according to data  from the U.S. Department of Transportation. 

As The Wall Street Journal  reported on Saturday:

GM hopes to fill a niche in the U.S. vacated by its German rival’s pullback. And Chevrolet last year added a diesel-engine option to its Colorado midsize pickup that has drawn favorable reviews from car critics, emboldening GM to expand its diesel offerings.

“It’s only been since the VW challenges that people have been sort of scratching their heads a little bit” about diesels, GM North America President Alan Batey said in an interview. “But we’ve been absolutely thrilled with how they’ve taken off for us.”

If GM can popularize diesel vehicles, the company can help reduce the overall carbon footprint of its fleet, which it’s aggressively pushing to modernize with electric, self-driving alternatives. Slashing, and ultimately finding ways to eliminate, carbon emissions from vehicles is critical to meeting goals set in last December’s historic 180-nation Paris climate agreement .

“We continue to have a positive outlook for diesel technology as it remains the most efficient internal combustion engine option,” Tom Read, a spokesman for GM, told The Huffington Post in an email on Monday. “There are no plans to phase out diesel technology as it will continue to be an important solution to achieving fuel economy and CO2 goals in a global economy.”

Last year, Barra, announcing the company’s better-than-expected third-quarter earnings, declared that GM was “a vastly different company today than just five years ago.”

Whether GM can succeed where Volkswagen failed may be the clearest test of that yet. 

This story has been updated with a statement from GM.