Audi's Truth in Engineering Ads Come Back to Bite Amid Probe

Parent Volkswagen Faces Allegations That it Cheated on Emissions Data

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"It's not that easy being green."

That was Kermit the Frog's lament to comedian Joel McHale in an advertisement during Sunday night's Primetime Emmy Awards which touted Audi's latest innovations in low emissions technology. (See video above, around three-minute mark.) The punchline couldn't have come at a less opportune moment for the German luxury carmaker and its parent Volkswagen AG.

Just hours earlier, VW Chief Executive Officer Martin Winterkorn apologized for breaking the trust of customers following revelations his company cheated on emissions data for nearly half a million of its diesel cars. The Audi campaign's discordance was compounded by the marque's U.S. slogan, "Truth in Engineering," which also featured prominently in advertisements shown Sunday during U.S. football games. The VW brand's North American slogan is: "Isn't it time for German engineering?"

"Volkswagen is an extreme example of a brand believing itself to be bulletproof," Jo Arden, head of strategy at advertising agency 23red in London, wrote in an e-mail. "In today's climate, consumers will run a mile from brands that say one thing and do another."

Mr. McHale ended Sunday's advertisement by climbing into an A3 plug-in hybrid -- the diesel version of the A3 compact was among the models that the U.S. Environmental Protection Agency said used software that turned on full emission controls only during tests.

Audi, which is the biggest profit contributor of VW's 12 brands spanning motorbikes to trucks, introduced the "Truth in Engineering" tagline back in 2007, a year after hiring San Francisco-based Venables, Bell & Partners to handle its U.S. advertising.

Audi spent $159 million on measured media in the U.S in 2014, while the Volkswagen brand spent $418 million, according to the Ad Age Datacenter, citing Kantar Media figures. The Volkswagen agency in the U.S. is Deutsch, Los Angeles.

The automaker is stopping sales of the diesel versions of Audi's A3 as well as of VW's Jetta, Golf, Beetle and Passat, spokesman Peter Thul said by telephone Monday. He declined to say whether Wolfsburg, Germany-based VW would suspend Audi's "Truth in Engineering" ad campaigns.

Auto site Jalopnik reported on Friday that Volkswagen had deleted some of its diesel ads from YouTube, including a series called "Diesel Old Wives' Tales," aimed at dismissing myths about diesel engines. Jalopnik, which reported the deletions on Friday, just as the emissions story was breaking, stated that "we don't quite know when Volkswagen actually scrubbed these ads from YouTube, and we don't know for sure why they removed the ads."

When reached by Ad Age via email on Monday, a Volkswagen Group of America spokeswoman declined to comment about the Jalopnik report. She referred to a statement issued Sunday by Mr. Winterkorn, who said that "I personally am deeply sorry that we have broken the trust of our customers and the public. We will cooperate fully with the responsible agencies, with transparency and urgency, to clearly, openly, and completely establish all of the facts of this case."

On TV, the Volkswagen brand on Monday continued to run ads for a new campaign that broke last week touting its smartphone integration technology, called "App-Connect," according to ad tracking service iSpot. Ads include celebrites such as Adam Scott.

Meanwhile, a revamped version of the Passat sedan is scheduled to debut in Brooklyn on Monday evening. Singer Lenny Kravitz, whose last album included the tune "I Never Want to Let You Down." is set to appear.

Auto News reported that two senior Volkswagen executives cancelled their planned appearance at the event, including Herbert Diess, chairman of the Volkswagen brand's management board.

"This is a classic case of the law of having to avoid overselling and overpromising," Mark Borkowski, a London-based communications consultant, said by telephone. "It shows an organization which is disjointed from its marketing brand message and PR."

Auto News has complete coverage of the developing story here.

Bloomberg News with contributions from Ad Age.

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