Volkswagen would do well to remember the 1982 Tylenol tragedy and how drugmaker Johnson & Johnson came out the other side.
Seven people died that year after taking capsules of Extra-Strength Tylenol, which had been laced with cyanide. The forthright way in which the company dealt with the public during the crisis assured the product would continue to be viable.
Before the deaths, Tylenol accounted for 37 percent of the analgesic market but fell to 7 percent after the poisonings. Because of the way the company handled things, though, it had climbed back to 30 percent a year later.
Obviously, there are differences. Johnson & Johnson had nothing to do with introducing cyanide to the pain reliever bottles, while Volkswagen intentionally used computer software to fool testing systems that diesel engines were cleaner than they actually were.
But VW, like Johnson & Johnson, had a good reputation beforehand and may be able to regain it by making some strategic moves. The first and foremost is to personally assure owners of the vehicles in question what the company will do to repair the cars, to make the repair process hassle-free and to do it quickly.
Marketers predicted Tylenol would never recover from the sabotage, but the introduction of tamper-proof packaging enhanced by a full explanation of moves by the company chairman and an extensive media campaign proved effective.
Although the move was costly — $100 million for a Tylenol relaunch — $1,000 invested in Johnson & Johnson shares just before the poisoning episode returned more than $22,000 only 20 years later.
Volkswagen's response will be costly, but honesty and transparency on the front end, quality in its new products (such as the CrossBlue SUV to be made in Chattanooga) and a commitment to being customer centered will go a long way toward restoring the company's reputation.
Locally, a meeting state Sen. Bo Watson, R-Hixson, is arranging between state legislators and VW officials would be a good place for VW to display forthrightness to the city where its only U.S. manufacturing plant is located. Legislators will be — and should be — looking to hear honest assurances from the company about the state's huge investment in VW and how — or if — it believes Chattanooga workers and the plant will be affected. The state's original $358.2 million stake and its portion of the $260 million for the new line deserve no less.