If anyone thought VW was the only one they aren't a student of history. Lance Armstrong wasn't the only biker to live stronger. This stuff is systematic.
One day a friend brought over special goggles. They were covered in black vinyl to block your vision completely. That day we all found out that every one of us cheated the same way. When playing with the new goggles, suddenly it was: “this game sucks” and: “let’s do something else”.
It was eye-opening (sorry).
Cheating on emissions tests strikes me the same way. “All the other car companies seem to be meeting their targets, how can we keep up?”
Well, it turns out that to be as good as the other players, you have to cheat just like they do.
The best case scenario for telling on competitors would be a larger fraction of a smaller market, worse outcomes would involve a similar or smaller fraction of an even smaller market (after symmetric response accusations hitting your own brand). You don't sell Marlboros by pointing out that smoking Lucky Strike might cause cancer.
If you mean doing the same kind of cheating that your competitors are doing then this implies knowledge of the method so you don't need to cheat. You can level the playing field by instead publicizing the fact that your competitors are cheating. You don't even need to name names. Just lobby governments to implement tests that will uncover it. Get tests done on your competitors vehicles by independent laboratories, ponder in public the question that reverse engineering the engine management code might be worthwhile.
On the contrary. When I was cheating at Marco Polo, I thought I was the only one. That I wasn't as good as the other players who were playing honestly, so I cheated to make up for the deficiency.
Your point still stands, though. These aren't kids in a pool. They're engineers who should be testing the competition's product, and discovering the defeat devices.
But if both parties are cheating, what's the incentive to bring light to this problem?