Volkswagen has been forced to apologise for misleading consumers and investors after releasing an apparent April Fool's joke during March.
The company said earlier this week it was rebranding its US arm "Voltswagen", in an effort to promote its new slew of electric vehicles coming to the market.
The report was treated as authentic by several international media outlets, board members at rival companies, and even by financial analysts at Wedbush, who wrote the name change "underscores VW's clear commitment to its EV brand and massive EV endeavours over the coming years".
VW's US-listed American Depository Receipts rose 16 per cent over Monday and Tuesday, falling by 5 per cent after the group admitted the hoax on Wednesday.
"Volkswagen of America developed and implemented a marketing campaign to draw attention — with a wink — to Volkswagen's e-offensive and the market launch of ID.4 in the USA," the company said.
"The intention was to generate awareness of an important corporate and industry issue in the country. We regret that the announcement rollout may have upset some people."
Chris McNally, automotive analyst at EvercoreVW told the FT that moving the share price "was not and is not the aim of the campaign". The Securities and Exchange Commission, the US regulator, declined to comment on whether it would investigate the matter.
It was an unusual strategy for a business that has spent the past five years trying to scrub a reputation for corporate dishonesty caused by the Dieselgate affair, where VW not only sold millions of cars that cheated emissions tests, but also attempted to cover up its wrongdoing when questioned by regulators.
Last week the group said it would pursue former chief executive Martin Winterkorn and ex-Audi boss Rupert Stadler for damages over the incident.
The electric gag spurred immediate comparisons with the emissions scandal.
"Voltswagen was the best April Fools' prank since VW told us diesel was clean," wrote Twitter user Whole Mars Blog, an electric vehicle account that often promotes electric car pioneer Tesla.
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This week's debacle began on Monday, when the business appeared to release the "new" name by mistake. In the hours that followed and into the next day, VW itself appeared to do everything it could to confirm the validity of the rebranding.
Its official US Twitter page changed its name to "Voltswagen," and an accompanying press release quoted regional chief executive Scott Keogh saying that the "name change signifies a nod to our past as the peoples' car and our firm belief that our future is in being the peoples' electric car".
Several outlets including the Associated Press, USA Today and CNBC quoted company insiders that the change was genuine.
On Wednesday, Lauren Easton, a spokeswoman for Associated Press, said the news group "was repeatedly assured by Volkswagen that its US subsidiary planned a name change, and reported that information, which we now know to be false".
She added: "This and any deliberate release of false information hurts accurate journalism and the public good."
USA Today spokeswoman Chrissy Terrell said VW "used this fake announcement as a way to manipulate respected reporters from trusted news outlets to get attention for their marketing campaign".
The press release was removed from the media page overnight on Tuesday, and the name of the US page reverted to its original.
While the company's German headquarters had signed off on the stunt before April Fools' Day, the group's US marketing team was responsible for publishing the release before April 1, people familiar with the situation said.
Automotive analyst Chris McNally at Evercore wrote: "You have to laugh, only Wolfsburg [VW's headquarters] could release a bad joke and miss the timing by two days."
The stunt was intended to increase publicity for VW's latest electric car, the ID.4, which is central to its electric ambitions following the botched rollout of its earlier ID.3 model.
The company has just 4 per cent market share in the US, lagging Europe and China where it enjoys about 20 per cent.
In 2003, the company changed the name of its Wolfsburg headquarters to "Golfsburg" to mark the launch of its latest Golf model.