SEC Investigates Volkswagen’s Name Change Marketing Stunt
The name change has a huge impact on any company. Recently, the public got into trouble because of a joke on April Fool’s Day. A few days ago, according to multiple media reports, the US Securities and Exchange Commission (SEC) has launched an investigation into Volkswagen America, because the company falsely claimed that it will be renamed “Voltswagen” in the United States.
According to the report, the SEC is investigating whether this unwise joke of Volkswagen has affected its stock price and violated securities laws. The agency had asked Volkswagen America to provide information on the issue in early April, and Volkswagen confirmed the news.
In March of this year, Volkswagen America released a false statement about the name change on its official website, expressing its intention to rename Volkswagen to Voltswagen, in order to show its determination to completely switch to electric vehicles in the future.
Volks means people in German, Wagen means car, which together means Volkswagen; and Volts means Volts in English, which means that Volkswagen is replaced by Volts, that is, Volkswagen.
However, the statement was quickly deleted and an apology was issued after being criticized on social media. Volkswagen America said that this is to make people pay attention to its efforts in electric vehicles.
However, Volkswagen’s statement of apology did not win people’s forgiveness. An industry insider said that “misleading marketing is risky, especially for the public.”
A marketing expert said that April Fools’ Day jokes are common in marketing, but few companies deliberately mislead reporters. For a company that already has credibility problems, making such a joke is a strange move.
The U.S. Securities and Exchange Commission (SEC) believes that this wave of Volkswagen’s marketing is suspected of manipulating stock prices. The SEC has stepped in to investigate this incident to understand how this action affected the automaker’s stock price and whether it violated any securities laws.
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