By on April 25, 2016

2016 Volkswagen Tiguan, Image: Volkswagen of America

Will Volkswagen TDI owners who opt for a buyback be soured on the brand, or can they be lured into a new model?

It’s a big question for dealers, who could stand to benefit from the dealership traffic they’ll see when Volkswagen’s buyback program gets up and running later this year.

The fate of hundreds of thousands of 2.0-liter turbodiesel models sold in the U.S. rests on the finalized details of the automaker’s April 21 settlement deal. Those details become public this summer, after which the company can start to buy back or fix (at the owner’s request) the vehicles caught up in the diesel emissions scandal.

The program will have to be run through the national dealer network, and though some former owners will leave determined to give another brand a try, some might linger in the showroom with company money in hand.

Desirable products are needed to keep them there, and an incentive or two would definitely sweeten the pot.

“Every single transaction and interaction with the customer we view as an opportunity to save a VW customer from defecting away from our brand,” Mike Morais, president of the 18-franchise Open Road Auto Group, told Automotive News.

Before that can happen, the dealers and the automaker have to craft a speedy and seamless process of buying back the cars that doesn’t leave owners pulling out their hair. Once that is put in place, the sales pitches can begin.

Volkswagen brand chief Herbert Diess promised to boost volume and deliveries of new and appealing products (like the Tiguan and 2017 Golf Alltrack) to U.S. dealers at the National Auto Dealers Association convention earlier this month.

The recent creation of a North American Region (NAR) for the company came with the promise of faster product procurement to satisfy regional demand. If the NAR works like it should, this would aid the dealer network’s goal of hanging onto customers. Waiting for a new vehicle would cause some buyers to think twice about sticking around.

Volkswagen eventually plans to offer a broad range of SUVs designed to tempt American buyers and get cash rolling into its severely depleted coffers, but that strategy won’t be fleshed out for a few years. In the mean time, dealers need to sell, sell, sell what they can get their hands on.

[Image: Volkswagen of America]

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54 Comments on ““Too Bad About That Old Diesel, Can I Interest You in Something New?”...”


  • avatar
    hreardon

    It’s all about product.

    As Honda, Toyota, GM, Jeep, et al. have all demonstrated: consumers forget (maybe not forgive), and so long as you have something compelling to offer them, they’ll buy.

    Those who bought the TDIs for fuel economy will be able to check out the 1.8T Golfs and 1.4T Jettas for frugality. This fall’s Alltrack might help keep a few around as well.

    It’s anybody’s guess as to what percentage of owners will dump the brand out of disgust, but again, as other brands have shown, that figure in actuality is likely much smaller than most pundits suggest.

  • avatar
    Kyree S. Williams

    I’m…kind of on the fence about a GTI or Golf R. And maybe the new Tiguan will be cool. Other than that, there’s really no other Volkswagen I want to buy.

    Ideally, Volkswagen *will* have the new Tiguan and Golf Alltrack out by the time it starts buying back cars…if it wants to have the best chance of retaining its customers. That three-row SUV would also probably get some former Passat TDI owners, but it doesn’t sound like it’ll be ready anytime soon.

    • 0 avatar
      yankinwaoz

      I see mentions of Passats on this thread. I own a 2012 TDi Passat. I really don’t think that we Passat owners are going to get buy back offers. So I don’t think the idea of Passat people switching to a large SUV is right.

      From what I’ve read, the buyback is limited to the smaller TDi cars that do not have an SCR system (Golf, Jetta, Beetle). I would expect those owners to be attracted to like replacements. The Passat has an SCR system.

      From what I understand, some newer Passats do not have SCR, which is puzzling to me. I don’t know if that is true of not. I see conflicting information. At least in my case, my Passat has SCR and needs adblue.

      For me, I expect that I will be ordered by CARB & the Cal DMV to take my Passat to a VW dealer and get the software upgrade that stops the cheating. I expect my mileage will suffer.

      I think there is a small chance that VW will also be ordered to replace my catalytic converter and replace it with a more robust version.

      I don’t think they will offer me anything beyond that since they already gave me $500. That will leave me only with the option of suing, or joining a class action suit. Neither of which I expect will pay me any dividends.

      • 0 avatar
        Kyree S. Williams

        a) All 2012+ Passat TDI units use SCR. The TDI powertrain has not been changed. The smaller cars (Golf, Jetta, Jetta SportWagen, A3, Beetle) had an engine that did not use SCR from 2009 – 2014, and switched to a new generation unit that did use SCR in 2015. My 2015 Golf SportWagen TDI has the SCR system and takes AdBlue.

        b) Volkswagen has not publicly distinguished SCR vs non-SCR vehicles. All 2.0-liter TDI engines from 2009 onward are part of the program. They may not buy yours back if it has SCR, and may instead opt to fix it. Or they might give everyone the option to sell them back. And if you get your car fixed, you definitely get the cash payout—that’s your remedy for the loss in value and performance of your car. You purchased a product that will not live up to its promises when it’s brought into compliance. But there’s been nothing so far excluding the SCR-equipped cars. The only people still in the lurch are owners of the 3.0-liter V6 TDI vehicles from VW, Audi and Porsche.

        So yes, your Passat is included in the remedy program as far as we know. Moreover, I heard talks that Volkswagen was unable to fix even the SCR-equipped vehicles without noticeable compromises, the sort that owners would want to be compensated for. If they had a solid solution for the SCR vehicles, they’d have surely used it by now.

        • 0 avatar
          Jimal

          That is how I read it too. If the Passat weren’t part of the problem, it wouldn’t have been involved in the recall, and us Passat owners wouldn’t have received the gift cards late last year.

      • 0 avatar
        notwhoithink

        If you read the transcripts of the proceedings and the various leaks that came out the night before the latest hearing, it is 100% clear that all 482,000 2009 and later TDIs with the 2.0L engine are in scope for the buyback. There is no agreement on the 3.0L TDI models yet, but the judge has given them until June 21st to work out a solution for them as well. In other words, you will get a buyback offer on your Passat.

      • 0 avatar
        tedward

        Kyree is right. The only significant change was in 15 when they integrated the intercooler into the intake manifold (among other things, fuel pump etc). It’s going to be really interesting to see how the passat and other 15’s take the new tune. Will it be the same performance loss the non scr cars suffer from? Or will it be mitigated by an increase in urea usage?

        Kyree, do the 16’s take a long time for you also (bluetooth comment)? Our new gti seems pretty quick to link, but I usually just use android auto so I don’t really pay attention to that anymore.

    • 0 avatar
      Michael F

      I have a 2013 Passat TDI, want to sell it back, my 1st & last VW. So is this article wrong about the buyback. This is a Gen 2 engine. Article below indicates they’ll only buy back Gen 1 TDI engines.

      http://usnews.rankingsandreviews.com/cars-trucks/best-cars-blog/2016/04/How_Much_is_My_Volkswagen_Worth/

      “Details have not been officially released, and many aspects of the plan are still unknown, including which of the three generations of engines will be included in the program. The bulk of the TDIs involved in the Volkswagen scandal are “Gen 1” models that may be very expensive to modify to meet standards, if altering the cars comply is even technically possible. More details are expected to be released following a June 21 hearing.”

      “The most likely scenario, according to Brauer, is that VW offers to buy the first generation of the diesels back, while the second and third generations receive modifications to bring them into compliance. It’s estimated that 325,000 of the 482,000 affected cars are Gen 1 models”

  • avatar
    eggsalad

    For about the last 20 years, Volkswagen in America meant only two things:

    GTI and Diesel. Most years, the GTI moves around 15k units (source: goodcarbadcar.net)

    Now that the Diesels are gone, the GTI certainly can’t carry the operation. Are the new SUV/CUV going to be enough to carry the US operations? Doubtful.

    VW’s reputation wasn’t that great in the first place; now it’s even more tarnished. I’d say the days are numbered for VW in the US.

    • 0 avatar
      White Shadow

      Not a chance in hell. VW had only been gaining until the scandal forced the brakes on, but it’s just a temporary set back and they will be back bigger than before. Mark my words, this is not nearly the devastating blow that some people make it out to be. VW isn’t going anywhere.

      • 0 avatar
        jpolicke

        Weren’t the bulk of the gains based on the diesel? I don’t expect to see those numbers recover.

      • 0 avatar
        notwhoithink

        I would submit that a scandal that turns into a massive PR disaster that results in over $20 billion in fines, penalties, and legal settlements will be devastating for any company.

      • 0 avatar
        SCE to AUX

        @White Shadow: keep trying. VW has been in a sales slide since 2012:

        http://www.goodcarbadcar.net/2012/10/volkswagen-brand-sales-figures-usa-canada.html?m=1

        They’re going down.

      • 0 avatar
        ajla

        Exactly. This is only a minor setback for Volkswagen.

        The triumph of German engineering is inevitable and this pathetic, illegal, and fraudulent attempt by Obama’s EPA (likely spurred by the Ford family and the leaders of Subaru) to slow them down will only make the eventual victory of the Gruppe all the more glorious.

        “Joe Dirt” Americans that even can’t drive don’t deserve these great vehicles in the first place. They should be happy Europe bothers with them.

      • 0 avatar
        Jimal

        VW was certainly NOT gaining prior to Dieselgate. Heading into September last year VW was down year over year in a year where just about every other automaker saw gains. I’m not saying that VW is going anywhere, but your statement about VW making gains isn’t based in reality.

      • 0 avatar
        Testacles Megalos

        I think you are correct. But it is not about product, even if they have massaged their high-end brands to extract more clams for more diluted products. It is how they do their business in their economic context. VW does not operate like Amurcun Compnees, i.e. BoD vs. Management vs. Labor vs. Guvmnt (except when bankruptcy is actually on the radar e.g. Chrysler and Uncle Lee). While the word “fascism” has come to have deep negative connotations, like “communism” the original idealism was different and utopian – – it’s all about formalized industrial cooperation between gov’t, management, and labor to deliver the best overall good for society. Such was and is the idea of VW. No way Saxony or the German fed’n nor the unions are going to let the company go belly-up.

  • avatar
    5280thinair

    As the owner of a 2010 Jetta TDI, the answer is “not with the products VW currently has.” I bought at the end of the 2010 production run as I didn’t like where VW went with the 2011s (bigger and cheaper, but taking a step backwards in refinement). I tried out a 2016 Jetta GLI at the dealer when I was in there recently for a recall/service, and while it’s not as cheap feeling as the 2011s it still seems like a step down from my 2010 (missing features like rear seat vents.) The Golf felt much nicer inside but as my wife has a hatchback I want to keep a sedan with a sizable trunk (it’s very convenient to have one of each.)

    I’m not interested in a SUV (and VW’s aren’t very competitive) and my feelings about the Passat are similar to the current Jetta. Combine my misgivings about rewarding VW with any more money after this business along with a lack of compelling product, and I’m pretty certain I’ll be taking my buyback & compensation to some other brand.

    I’d be happiest with my low-mileage 2010 having the emissions issue resolved without impacting power or fuel economy, but that doesn’t look possible at this point.

    • 0 avatar
      tedward

      That leaves you in a rough spot man, I can relate as a manual only buyer. You might have to jump categories or price points. The gli is not as good as the gti, but then the rest of the market doesn’t offer a c segment mainstream sedan that does what you want either (focus, cruze, mazda, civic, corolla, impreza). None of them offer their best work, performance, or significantly better than jetta interiors in sedan form. You, my friend, are screwed for new cars.

      I think the golf is king in the mainstream c segment right now, but the premium c segment is full of cars that compete on even footing, as is the mainstream mid size market. I think you’ll have to buy used in one of those to keep budget and desires.

  • avatar
    Corollaman

    When VW introduced the new 1.4 turbo, I thought is was gonna make people forget about the diesel debacle and jump into the new little engine that could, but besides the initial positive reviews, I don’t see any such success.

    • 0 avatar
      Jimal

      That is because the 1.4T isn’t all that great. It is better than the 2.0 it replaced, but that is about it.

      • 0 avatar
        tedward

        No it is an awesome proposition, just like Hondas new 1.5t. We’re finally seeing the benefit of turbocharging hitting the mass market, and not just replacing six cylinder engines.

        Both of these engines break 40mpg, deliver class up torque, and make that torque at low low rpms. It’s a use of the technology that actually threatens the slow and steady late adopters.

  • avatar
    zerofoo

    Anyone with a brain will take the buyback cash to their Toyota/Honda/Nissan/Hyundai/Mazda dealer and buy the car they should have bought in the first place.

    I’m a recovering VW owner. I gave VW 3 tries to get the cars right. I should have simply bought a Honda.

    Live and learn. Pity really – VWs are fun to drive.

    • 0 avatar
      Corollaman

      They sure are and funny how VW fanboys get all upset when people say that about the brand

    • 0 avatar
      SCE to AUX

      Totally agree, except my 02 Passat wasn’t even fun to drive.

      I can’t see people sticking by VW. One would also have to question their future viability in the US when making a purchase decision.

      If VW discovers that TDI buyers really just bought the car for the engine – which is no longer available, presumably – they’ll see most of these customers go elsewhere.

      • 0 avatar
        notwhoithink

        Agreed. If VW had been quick to work out a settlement (even just a generous trade-in towards another VW) back in Q4 of 2015 I would have happily jumped into a different VW model. Instead they’ve dragged it out for months and the scandal will likely be over a year old before we get our buybacks. The Honda Accord Hybrid will be back by then, with fuel economy that’s as good as I’ve ever gotten from my TDI. And if you look around on various TDI forums on the Internet one of the biggest questions people are asking as “what car are you going to get with your buyback?” I’ve yet to see anyone answer “another VW”, outside of the occasional dreamer who says “I’d take a Golf R in trade”.

        • 0 avatar
          jthorner

          notwhoithink: You describe exactly what I was saying in late 2015 when this all started. I said that buybacks were inevitable because there was not going to be a technical retrofit which would both bring the vehicles into emissions compliance and maintain performance, fuel economy and durability. Some on this board called me all sorts of names, but in the end my view was correct.

          I also said that from a customer relations point of view, VW should have jumped out ahead of the curve and offered generous buybacks up front instead of trying the minimize costs by “managing the problem”. This also turns out to have been correct. Now VW has drug this out way too long and has created a river of frustration and disappointment for the beleaguered customer base.

          Sure, people have forgiven and forgotten VW’s massive errors before (from the PA produced Rabbits through the engine coil fiasco and on into sludge monster motors), but the cumulative effect of all of those problems is that minuscule market share VWOA has today. VW Group has about 13.5% share of the world automotive market, but only about 3% in the USA, and almost half of that 3% is thanks to the relative strength of Audi and Porsche in the luxury end of the marketplace.

          German engineering, indeed.

          • 0 avatar
            Pch101

            You’re heavily invested in this, for whatever reason, but you’ve missed the story here.

            VW’s remedy for the EPA is that it will invest in pollution-reduction technologies (whatever that means.) That probably means that everyone acknowledges that the cars can’t be fixed, therefore the repair option that is offered to owners will not really fix much of anything but will merely placate the regulators.

            VW owners will be offered the choice between either (a) buybacks or (b) a fix + cash. Which is to say that most of them will take the cash.

            And I’m willing to bet that accepting the cash or buyback will be in the form of a settlement that requires an owner to forfeit the right to sue.

            So no, this is probably not turning out as you expected, and the time that was spent negotiating with Uncle Sam et. al. was time well spent.

            The key to making the deal work is the nature of the repairs. It sounds as if most of the polluting cars will remain on the road, even though there no way to substantially reduce their NOx output. That is not the kind of compromise that arises from just a day’s worth of deal cutting.

          • 0 avatar
            notwhoithink

            @Pch101: You almost had it right. It’s not a) buyback or b) fix plus cash. It’s actually a) buyback + “generous compensation” or b) fix + “generous compensation”.

            Go read the transcript of what the judge said last week. It’s clear that there are two separate “agreements in principle”. One is between VW and the regulators (solution is buy or fix, plus paying fines etc). The other is between VW and the class action plaintiffs (solution is “generous compensation”). Owners will get both.

          • 0 avatar
            Testacles Megalos

            You noted at the time that if a technical fix that preserved mileage and driveability were possible that VW would have already done it.
            The only “buy back” however that I think would have preserved any sense of brand preference would have been a voluntary program of credit of full paid price (regardless of car age and mileage) in early October ’15 towards a new VW. Dealers would have been happy for the floor traffic, customers would have gotten a new car and relieved of a headache, and my guess is that such a program would have put VW in a more favorable position when the inevitable class action and environmental lawsuits started. A mileage/age-based buy-back would have looked cheap and my guess is not well-accepted.
            The recovery plan needs to incentivize customers to return to VW. Whatever is offered accross the board could be supplemented with a $5k payment by VW to the dealer for every VW they sell to buy-backers. If the dealers are clever they will pass that $5k right to the customer.
            How’s the red car?

    • 0 avatar
      brn

      You gave VW 3 tries to get their cars right?

      Maybe those that have only given them one or two tries will buy again?

  • avatar
    laserwizard

    Well, if people still buy Total Recall Motors products after more than 100 people were killed by the stupidity of the company and lack of caring to report the safety issues, then why should we care if people come back to VW?

    Honduh intentionally defrauded people by building cars with odometers that ran faster to get cars out of warranty; Honduh also assumed it customers were so stupid that they could be fooled with the prior generation Civic that was decontented and made cheaper while raising the price. Honduh has a history of deceptive fuel mileage claims with every hybrid it has built. Yet the Honduh buyer comes back for more.

    • 0 avatar

      What’s with this bush league OMGZIGNITSHUNRECALL claptrap? Jesus. Get over it.

    • 0 avatar
      Kyree S. Williams

      I think you should see a therapist about your ardent, unbridled hate for Honda products…and stop trolling the comment sections in the meantime.

      • 0 avatar
        Fordson

        C’mon, man. Ardent, unbridled hate for Honda from one guy…the fact is that ardent, unbridled hate for VW products is a staple of TTAC.

        The Dieselgate pearl-clutching, reflexively provided by the Toyonda set, is without question the biggest page-view driver TTAC has. Post selection on any given day is 50% Dieselgate, 50% everything else.

        • 0 avatar
          Kenmore

          Besides, every village needs an idiot. It gives jerks like me an easy target and do-gooders a cause.

          Plus, BAFO’s in a distant time zone so it’s generous of this guy to sit in.

        • 0 avatar
          Kyree S. Williams

          I don’t know about that. TTAC’s biggest crime is capitalizing upon the misfortune of a company that’s currently in the limelight…which is standard practice for any news site. They did the same thing to GM. Hell, GM had a Death Watch…

    • 0 avatar
      Pch101

      The use of terms such as “Honduh” only brings more attention to the drool on your face and the inverted cone-shaped hat on your head.

  • avatar
    Oberkanone

    Shallow environmentalists are gone. Let them buy electric cars fueled by coal burning powerplants and made in china solar panels.
    VW needs certification for their 2017 diesels if they plan on selling the dieselheads.

    • 0 avatar
      Kyree S. Williams

      In all honesty, it will be a lot easier to create a clean energy infrastructure if the cars themselves are clean. Shifting the burden of zero-emissions to powerplants is a lot easier than having cars produce their own clean energy. In fact, cars have *never* been able to sustain themselves on their own energy (cleanly or otherwise), and gasoline / diesel production is an even dirtier affair. Why do we hold EVs by such high standards, then? At least they best their ICE counterparts by not making the environment any filthier than it already is in their operation.

      The main argument against new EVs is that (a) they tend to be taxpayer-subsidized toys for the wealthy, and (b) the benefit of taking older, less-efficient cars off of the road may not quite be as high as the cost of producing EVs and other efficient cars with which to replace them. Cash-for-clunkers was a very bad idea from an environmental standpoint, but it did help inject some life into the then-struggling auto industry (and VW really capitalized on it with its Clean Diesel lineup.)

      • 0 avatar
        brn

        Kyree, China may disagree with you: http://www.bloomberg.com/news/articles/2016-04-14/hong-kong-teslas-linked-to-more-co2-emissions-than-gasoline-cars

        • 0 avatar
          Kyree S. Williams

          You just reiterated my point. China uses very pollution-heavy methods for generating electricity. That is not Tesla’s fault. They made the car as clean as they could; it’s up to infrastructure engineers to make power generation cleaner.

          • 0 avatar
            CoreyDL

            There’s nothing quite like waking up with a fresh cup of Lang Jiang tea, brewed over an open coal flame in the kitchen.

  • avatar
    Michael Haz

    I drove my wife’s Jetta to a local Vee Dub dealer for an oil change last Thursday afternoon. The showroom was a ghost town. Plenty of cars, plenty of sales reps, but not one prospective customer. Not one. Most of the cars had pretty interesting price reductions on their windshields. Passats, especially, had discounts of 10% to 13% of MSRP. Tempting.

    Earlier in the same day I stopped at a Honda dealer. The showroom was organized chaos, with sales desks jammed into every nook and cranny, and people lined up waiting for a sales rep to become available.

    Good luck, VW.

  • avatar
    nels0300

    Me and probably 17 other people would buy a GTI wagon. I don’t even like VW.

  • avatar
    brettc

    For them to “put me in a new VW today” (long after July 26th), it would have to be an exceptional deal on a TSI Golf or Golf wagon. Otherwise I’m taking whatever they give me and buying from another brand.

    I can already see the buyback process being plagued with problems. I’m saying that based on previous experiences with VW and their track record since September of 2015 in handling this mess.

    • 0 avatar
      notwhoithink

      In fairness, the TDI good will program was pretty well done. The only issue that I had with it was how long we had to wait for the cards once we registered for them.

      People talk about VW offering special incentives through dealers to TDI owners to keep them in the brand, but they still need to have something worth buying. A few guys might be interested in a Golf TSI or wagon, but the people who wanted high MPG are going to leave VW for something more fuel efficient. VW has about zero chance of retaining their business.

  • avatar
    Number6

    “Every single transaction and interaction with the customer we view as an opportunity to save a VW customer from defecting away from our brand,”

    This is the funniest thing I’ve ever read on this website. Now that the dealers are the ones being screwed, all of a sudden they care about customers. You can’t make this stuff up.

  • avatar
    karonetwentyc

    We have a 2012 Jetta TDi, so are definitely affected by the diesel scandal.

    Here’s the thing: ultimately, we like the car and have no real desire to replace it. However, now that its value has been significantly lowered, we may not have much of a choice in the matter as once it’s paid off in a couple of years we could end up with a vehicle with little subsequent resale value.

    The problem is that we have no interest in replacing it with a gas-engined model. This means that any buyback is of no real use to us as the driving characteristics of a gas-engined car aren’t what we’re looking for in the household daily driver.

    Our ideal resolution: VW comes up with a fix that doesn’t impact economy, range, or performance, fits it at their cost, offers compensation for nuking the residual value, and we go away happy. Equally acceptable would be for them to go all-out on certifying new-model diesels, buy back this car, and hand us the keys to a compliant 2017 Jetta TDi. However, that’s not at all likely to happen.

    So yes – while we’d buy another Volkswagen, it would have to be one that does what this car has been doing at least as well if not better. Unfortunately, it doesn’t appear likely that this will happen within the next 12 to 24 months, and we’ll be under a deadline to either accept a buyback offer or have the car modified. We’ll have to continue to see how it plays out.

    • 0 avatar
      yankinwaoz

      I’m in the same boat. My 2012 Passat TDi has been a wonderful car. I really don’t want to part with it. I will have it paid off this year. So I will have 120k mile car that runs great with zero trade in value. So I think that my best option is to hold on to it until it finally craps out.

      Which was my plan when I bought the thing. I planned to get another 4 years of service from her. Six more years if I am lucky.

      Well. All I can do it wait and see what the options are when they are finally presented to us.

  • avatar
    blueflame6

    It’s just amazing to me that part of their plan to make things right with dealers is, literally, to start shipping products that Americans actually want to buy.

  • avatar
    Irvingklaws

    Funny, after the turbo on my TDI Golf blew I was off VW’s and thinking my next car would be a Mazda 3, or something else. Now with all the VW hate of late, I kinda want another one.

    Go figure…

  • avatar
    GTL

    I really like my ’13 Passat – 65k miles no issues at all. When (if?) they offer a choice between buyback or repair, I’ll have to think long and hard on it and of course the incentives (cash and or discounts) will play a role.

    I keep vehicles for a long time, but with the majority of TDIs being taken off the highway the availability and cost of parts will be a consideration for the long term.

    I would like to get a Golf Sportwagen, but unless inventories change, there won’t be one available outfitted the way I’d like. I’m not opposed to a new TSI Passat for that matter, but again, it depends what incentives are offered at the time.

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