By on May 17, 2016

volkswagen-jetta-tdi-clean-diesel-event-no-better-time-to-buy-large-3

Decades of feel-good corporate outreach and a hug-worthy relationships with buyers didn’t stop potential customers and veedub diehards from fleeing Volkswagen after the diesel stink bomb went off in Wolfsburg.

Like a husband of 50 years caught cheating with his wife’s sister, the intentional deception behind the diesel emissions scandal shattered the hard-earned trust between the company and its consumers. Thanks to that, Volkswagen’s sales trajectory now mimics that of a very leaky submarine.

Could Volkswagen have managed the scandal better, and can the company rebuild that lost trust?

According to the consumer opinion-tracking Reputation Institute, the answers to those questions are “you bet” and “yeah … it’s gonna take a loooong time.”

The Reputation Institute measures corporate reputations in the U.S. with its National Tracker service. It assesses a number of companies monthly by tracking the perception of the “informed” general public. To be a part of the study, a person must be familiar with (but not employed by) a particular company.

On any given year, the tracker gauges the monthly feelings of 2,000 individuals per company.

RI then takes the “pulse” of each company, assigning a ranking based on the public’s emotions (is the company a feel-good one or not?) and their opinion on a broad list of corporate governance values.

RI released a report on Volkswagen’s reputation today.

In the first quarter of 2015, Volkswagen enjoyed a good reputation worldwide, with a “RepTrak Pulse” figure of 70 to over 80 percent in surveyed countries. After the emissions cheating was laid bare, that reputation plunged by 23.5 points in Germany, 24.8 percent in France, and 29.9 percent in the UK.

The more distant U.S. recorded an 8.7 percent drop in the brand’s favorable opinion.

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Consumer willingness to buy Volkswagen products dropped even further, with declines of 30 points or more recorded in some European countries.

According to Stephen Hahn-Griffiths, Reputation Institute’s vice president of U.S. strategy consulting, the “emotional crutch of a legacy of goodwill” doesn’t survive long when people start to take a hard look at a company’s actions, and begin asking questions.

In Volkswagen’s case, the damage is done, and the automaker faces a long, tough road ahead.

“Getting that emotional/feel-good back is going to take a long period of time,” said Hahn-Griffiths in a phone call with TTAC. “There’s no quick fix overnight. A lot of the love out of legacy was lost, and it’ll take a lot of effort to gain it it back … You can’t message your way out of the situation. You have to earn back reputation literally one potential member of the general public at a time.”

Even the company’s “loyal ambassadors” — those people who can be counted on to defend “their brand” in public no matter what the controversy — are nowhere to be seen in the wake of the scandal.

So, could Volkswagen have prevented some of the damage in the wake of the scandal? The company didn’t do a good job in the early days (or months) of the crisis, and that will hurt them.

“Right now, VW is stumbling and bumbling through a series of good intentions that are poorly executed,” said Hahn-Griffiths, adding that Volkswagen avoided culpability when the scandal broke, went through a period of denial, and generally acted very slowly to address the issue.

The closest (recent) parallel in the auto industry is Toyota’s unintended acceleration scandal, which didn’t damage Toyota’s reputation nearly as much as the diesel scandal has damaged Volkswagen.

After a slow start, Toyota did the right things, said Hahn-Griffiths. Thanks to public discourse, transparency, and cooperativeness, the hit to its reputation only lasted six to nine months.

Volkswagen Golf family

Volkswagen’s multi-billion dollar deal with U.S. regulators and owners was the first major step to overcoming the legal issues surrounding the scandal, but all those buybacks and repair jobs likely won’t start for months. Even then, many former owners will walk out of dealerships, never to return.

Will smoking deals keep them there? Don’t count on it, says Hahn-Griffiths.

“Monetary incentives, and a focus on ‘Hey, we’ve got a great product’ is not going to be enough to win loyalty,” he said.

“We know, based on data, that only 40 percent of reputation can be attributed to the measures of products. Increasingly, the other 60 percent is based on the company that stands behind the products … (Volkswagen) has to take decisive action, not just on admitting the culpability of the cheat device, but treating customers with the utmost respect and appreciation through an unparalleled customer service experience. That’s the best chance VW has to retain those customers.”

The automaker’s buyback program is fraught with danger, due to the unprecedented scope of the program (coordinated through a stressed dealer network), and the complexity of coordinating the whole operation.

Get it wrong, and Volkswagen will have even more people cursing its name.

Tomorrow marks eight months since the Environmental Protection Agency leveled charges and blew the lid of the long-simmering emissions scandal. Has the automaker recovered any of its lost reputation since then?

Going by early second quarter results, the answer is a flat “no.”

“Volkswagen is still in the roots of recovery, and we’re not going to see any significant bounceback any time soon,” said Hahn-Griffiths.

[Image: Volkswagen Golf, Volkswagen of America]

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60 Comments on “Rebuilding Volkswagen’s Reputation – Hard or Downright Impossible? An Expert Weighs In...”


  • avatar

    PHEV and EV.

    It’s the only way.

    And you’d better not try to lie about “range” or “charging times”.

  • avatar
    threeer

    Just look at Audi and how long it took to recover from the “Unintended Acceleration” debacle. And I can speak to the resistance to considering a VW. Was out shopping two weekends ago for a vehicle to replace my Lancer Sportback Ralliart which met a very sudden death. Tested a 2013 VW Tiguan that I really liked, but wound up with a 2014 Escape. I liked the acceleration and overall feel of the little Veedub, but my wife and I just couldn’t get over that little lump we had in our throats about owning another VW. Granted, my last new VW was in 2000, but that experience still lingers for us, and the current situation VW finds it’s self in left us wondering about “down the road” with a VW product.

    Yes, it is going to take Volkswagen a significantly long period of time to recoup the damage done. It will soldier on, as in Europe, VW is still plenty big enough not to fail (sounds familiar, doesn’t it?), but the future growth in North America is, at a minimum, stunted. They have to get both creative and a little “outside of the box” if they plan on standing a chance of a full recovery.

    • 0 avatar
      Kyree S. Williams

      Honestly, Ford’s newer EcoBoost vehicles are every bit as scary as what Volkswagen sells. But because Ford’s cars are more common, you’ll still come out ahead.

      • 0 avatar
        threeer

        I’m driving the “lowly” 2.5 variant, not the Ecoboost. It isn’t a speed-demon, but for what I need a vehicle to do right now, it’s enough. The A/C works (good for when you’re hauling rescue/shelter dogs in the middle of the Alabama summer), it has Bluetooth and back-up camera and it gets better mileage than my Lancer (marginally, but hey…). And as you said, much more plentiful than my Lancer. Finding parts for that thing was never easy (especially when it came to the lower body kit pieces and parts). The Tiguan was the sportier of the two, but I’m OK with what we got.

  • avatar
    GTL

    Wonder how much of the drop in sales is due to individual’s reaction of the scandal vs how much is due to 25% of its product line suddenly becoming unavailable?

  • avatar
    laserwizard

    Seriously – this was only about emissions.

    VW’s products worked fine and no one was hurt until they lost value in their product they purchased. The diesels gave great durability and mileage. It was not like the cars were unsafe or fell apart.

    I fail to see the harm here other than perceived decreased value. If you kept your VW for more than a decade there is no loss in real terms at all.

    • 0 avatar
      SCE to AUX

      VW’s products didn’t work fine, according to the EPA.

      Statistically, some people were actually hurt by the extra NOx put into the air.

      Durability isn’t what interests the EPA.

      Long term, nobody knows what ramifications the ‘fix’ will have. If these TDIs suddenly become undriveable, or get gas engine fuel economy, their original point of their existence will be moot. Customers purchase based upon trust and perceived value, and both have been ruined by VW’s intentional actions.

    • 0 avatar
      LIKE TTAC.COM ON FACEBOOK

      “Perceived decreased value” is huge. Would you want to buy a car, knowing that its resale value would be significantly lower than similar choices from other makers? The reasons for the lower value aren’t just the diesel emissions cheating – the whole brand is now tarnished.
      Any car will depreciate over 10 years, and people like you and me reasonably expect at least 10 years of dependable service from a new car. VW hasn’t had the built-in reliability that they try to imply in their “German Engineering” ads(plastic water pump impellers, etc.). Many car shoppers plan to trade their car in after three, four or five years. How much is a three-year old TDI worth as a trade-in right now?

      The emissions issue isn’t small potatoes, either. It was blatant, systemic, institutional dishonesty perpetrated on multiple countries, violating multiple laws, with tens of thousands of victims. Honest customers expect honest products. If a student were to cheat on their doctoral thesis like VW cheated, they would be irrevocably expelled from their university. VW is now deservedly undergoing its own form of expulsion, from the marketplace.

    • 0 avatar
      jrhmobile

      No, it’s not. The emissions scandal was the coup de grace. Volkswagen has been courting this disaster for a generation.

      From various electrical and engine ills in the early 2000s to an arrogant and indifferent dealer body to de-contented cars and unrealistic sales goals putting pressure on the dealers, management of the VW product line and sales organization has been a comedy of errors. The emissions scandal lit the fuse that set off the mock outrage, and is certainly endemic of VW’s mal-management, but Volkswagen has taken years to build up this powderkeg that just blew up in its face.

      VW can turn this around in three years time with the following course of action:

      1) A 10-year, 100,000 ironclad, bumper-to-bumper warranty for everything it sells. Take a page from Hyundai and prove that you’ll stand behind your cars.

      Volkswagen built its reputation on selling simple, reliable cars. Then it maintained its reputation by building cars where little, incidental things kept breaking and failing, but the basic car ran like a tank. Then it gave up on the basic car. A rock-solid 10-year, 100,000 mile warranty shows VW is willing to stand behind its cars, and buy the company time to rebuild its reputation by building consistently better cars.

      2) Retrain and re-incentivize the sales organization. You don’t do that by putting rebate money on the hood. You do that by training dealer staff to provide basic courtesy and quality customer service, effective and efficient vehicle repair service, and realistic sales goals so dealers don’t have to beat customers to death to make their sales quotas.

      Incentivize customer satisfaction more, sales targets less, warranty repairs completely and comprehensively, and train dealer staffs how to cater to customers in a way that benefits VW, the dealer and its customers. It won’t be chap, but it will pay handsome dividends.

      3) Simplify the basic product and expand its options. Admittedly, today’s cars are more complex than they were 50 years ago. But a lot of VW’s current complexity contributes to its fragility, and contributes little to its desirability or reliability. Piping engine noise in through the sound system? Please …

      Go back to the ’60s and sell a basic car with options, not selling a model line with only two or three options packages. Let buyers buy a basic car with a sunroof, or a top-line model without one. Make in-car navigation an option across the entire model line. VW simplified its offerings for its own benefits, not those of its customers. The first manufacturer that breaks this mold and lets customers order cars the way they want will build an immediate and loyal following.

      4) Build a son-of-Fox simple car. Maybe that means importing a basic Polo or that brings the e-Up stateside. Either way, a sub-Golf class car keeps VW from ceding first-time (and genuine cheapskate) car buyers to Nissan and Kia.

      • 0 avatar
        threeer

        Except it seems that most new-car buyers don’t want “small” or “simple.” If it isn’t an SUV/CUV, it’s already behind the curve as far as sales go. I don’t see where bringing either a Polo (though I’d dearly love a Polo GTi) or worse yet, an Up! gets VW anywhere in the US. Revamp the Tiguan to be genuinely competitive with the rest of the small SUV/CUV market and maybe they have a shot.

      • 0 avatar
        tedward

        1 and 2 are spot on. 3 isn’t really the issue anymore, as the industry is quickly approaching tech parity. If anything vw has the advantage now on ubiquitous technology (we beta tested it for them!)
        4. That’s interesting, my heart agrees, but the record shows that the public and the media does not want to see vw step backwards from irs and di/turbo in the US. Remember the base jetta last gen and the reaction it engendered? How about all the ink spilled criticizing the 2.5 and 2.0?

      • 0 avatar
        MotoEV

        My understanding of the industry is a little different….

        1) VW Germany has been know for years as one of the highest cost companies when it comes to car manufacturer. In German (highly compensated and unionized)

        2) Germans tend to pay more for the similar size cars than we do in America. Our cars are decontented because we want the lowest price. Most Germans order their cars than but them off the lot.

        3) A ‘basic’ car has little to no profit margin. High profit options / services keep the dealership afloat.

        4) The VW group does not have the supplier leverage GM posseses in North America resulting in VW cars costing more. The warranty you mentioned will have a cost that will be passed back to the consumer (higher service costs, higher sales costs).

        5) Cars are cheaper to produce when there are fewer stand-alone options and configured as packages. Germans order to spec but American don’t want to order and wait. They want to saunter to the dealership and look over hundreds of cars on the lot.

        Bottom-line… German cars built in Germany / high wage areas cost more to purchase and maintain.

        I will pay the German premium for sales / service. However, I don’t want to be deceived by material fraud. Owner 2010 VW TDI 38k miles

    • 0 avatar
      benders

      Yes, this scandal was about emissions but I have no confidence that emissions was the only area they shortcut. This scandal is evidence of a culture that is willing to take shortcuts.

  • avatar
    heavy handle

    VW is down 10% YTD.

    TDI was more than 10% of their sales last year, so their non-diesel stuff is up.

    Think of what they could do if they offered a modern crossover or two.

    They really don’t need to much to fully recover. Maybe just steal a line from the GM playbook: “that was old VW, we’re different now.”

    • 0 avatar
      Sjalabais

      Outstanding answer. Substituting real numbers for a metaphor about sinking submarines didn’t do the above article any favours.

    • 0 avatar
      mike1dog

      This is assuming zero who were going to buy a diesel VW didn’t buy a gas VW instead.

      • 0 avatar
        heavy handle

        Of course some VW buyers were going to buy a diesel. That’s the point. Buyers have not abandoned the brand.

        The way forward for VWoA is clear: don’t even try to sell any diesels in the US. Sell some crossovers, update the Jetta/Passat, hang a sign that says “under new management,” ease-off on the incentives slowly.

        This will be old news soon, just like the GM ignition scandal, the Toyota acceleration scandal, the Hyundai MPG scandal, etc…

        • 0 avatar
          MotoEV

          I do believe VW will slowly walk away from diesels in the NA market unless emissions requirements change.

          What is up-in the-air is: What can VW do to prevent 400K+ customers impacted by the emissions scandal leaving the VW Group brand forever?

          Assuming a happy customer buys / leases 2 additional VW family products over their lifetime (at a minimum of $30K each), the number below represents future lost revenue for the VW group.

          $24,000,000,000

          I would hope VW executives would make an extremely strong offer to affected consumers to avoid having these customers strike VW group products off their list. An angry customer costs more to win back than a happy customer.

          It took VW a almost a decade to sell 400,000 TDIs to US consumers. Mercedes and Jaguar are now offering 4cylinder diesels in NA. They could lose this customer base FOREVER.

    • 0 avatar

      True,
      But VW was the only major auto group to take a hit on transaction prices so far this year.
      http://www.prnewswire.com/news-releases/new-car-transaction-prices-rise-nearly-3-percent-in-january-2016-according-to-kelley-blue-book-300213421.html

      They are keeping their market share (down a little actually) by pushing cars out the door for cheap. As shown by the 200 this is unsustainable long term. I don’t think it will take them forever to bounce back but it would take a few crossovers and a few years of 0 profits from VW-USA .

  • avatar
    Kyree S. Williams

    I don’t live in an eco-conscious environment like California, but this has been my experience:

    – 10% of people don’t even know that Volkswagens and other small cars are sold with diesel engines
    – 40% of people have no idea about Dieselgate
    – 15% of people know about it, but merely make wisecracks and light jokes about the whole thing
    – 34% of people don’t even pay attention to Volkswagen because the company’s cars are ill-suited to the American market and there are generally better options elsewhere
    – 0.00001% of people are Volkswagen owners like myself

    In other words, Volkswagen would do better to come out with competent products than to try and salvage its reputation over the diesel scandal, which may not even be all that damaged.

    • 0 avatar
      jpolicke

      I think your numbers are spot on, Kyree. As commenters to TTAC we are not representative of the general population, and VW is just not that big a deal to most of the US.

      It also isn’t helping the public perception of VW that 8 months after the story broke, NOT ONE affected car has been cleaned up.

    • 0 avatar
      duffman13

      You forgot the 15% of all people (overlappping with some of the groups you already listed) who already had or know someone who had a bad VAG experience. The MKIII-V era lasted a long time, and they put out enough garbage product to hurt their reputation the old fashioned way.

      As much as the TDI thing is bad press, I don’t think it really impacted them all that much – the TDI is a niche products, and the mileage on their gas engines is close enough now that it’s a viable alternative.

      I’d argue their biggest failing is their inability to offer a competent CUV. As a consumer I’ll take the bad press and flagging sales though, as it means close to $5k discounts on $22k cars in many cases – nothing to shake a stick at.

    • 0 avatar
      EquipmentJunkie

      You are correct, Kyree. Only a few of us know the whole VW TDI scandal. A personal example from late last week, a co-worker was looking at a used ’12 Jetta TDI for his daughter and son-in-law. I owned two TDIs in the past so he knew I was as close to a TDI expert as anybody. During our conversation about the car, he said that he thought that VW’s TDI issue was over misrepresenting fuel mileage, not cheating on the emissions test. The truth didn’t seem to matter.

      Most consumers don’t know about Dieselgate and a hot new product is the quickest thing to make the rest of them forget.

    • 0 avatar

      It did make national network news the first 2 weeks. I had several non car people relatives ask about it during thanksgiving, so it did some damage in the general public. I believe the above survey is also general population not car enthusiasts so that’s showing the damage as well.

    • 0 avatar

      Kyree is right. Most normals could care less.

      For the record, my 2012 TDI drove well and was a very good car.

      Everything past the turbo was nonsense, but the rest was OK. I expect future values to reflect the tissue paper exhaust system, and most cars to eventually end up in a “no emission inspection” State with electrical tape over the CE light. An enterprising person could buy a used one from an inspection state, toss the clearly useless emission equip, Malone tune and straight pipe, and live happily ever after, getting the 300k that the VW diesel used to be known for.

      I like VW, and have had at last count, five of them, but after my experience with the emission system in the TDI, and more importantly, the response of VW warranty, I’d be very leery of any VW OR Audi product. Yes, I’ve been burned, and am now wary….they don’t stand behind the product.

    • 0 avatar
      raph

      Yup, that’d be me in the 15% category! VW’s brand is neither worse nor better in my eyes but certainly more entertaining.

      • 0 avatar

        My biggest beef with them is the damage they’ve done to diesels in general in the US. I like my (pre-scandal) TDI just fine despite the few bits and pieces that have fallen off or broken over the last 10 years.

        I was sincerely hoping that my next car would be another diesel, whether from VW or someone else. Seems like we keep hearing about companies like Ford or Mazda “seriously considering” diesel releases in the US, only to never have them come to fruition. Now what was a possibility will probably never happen just because of the public’s conception of diesels in general, which never recovered completely from the GM debacle of the early 80’s.

        • 0 avatar
          tedward

          I think those decisions were made long ago. I would bet real money that another mainstream manufacturer enters the us diesel game soon. Lead time is huge in this space, and so are developement costs. We can pooh pooh 500000 sales all we want. What other manufacturers have seen is a marginal brand with limited dealers selling a profitable number of higher transaction cost cars. They want a piece of that, especially since the free gas gravy train will leave the station at some point and gasoline car emissions targets are likely to change in the future if those particulate studies hold up.

  • avatar
    DenverMike

    They’ve no choice but to start making good cars now. They can’t hide behind the “German Engineering” shtick any longer. Until recently, bad news used to have to travel by Pony Express and Smoke Signals.

  • avatar
    DenverMike

    Oops, they’re advertising a used ’14 Jetta SE in the top banner. $14,999?? A local Subaru dealer. IN STOCK!!!

  • avatar

    Interesting paradox. In the Netherlands, where we tend to struggle with traffic, emissions and high fuel prices, Volkswagen remained the #1 car seller. Most Dutchies don’t seem to give a damn about what Volkswagen did. That’s probably because the EU, that ‘facilitated’ the bogus testing methods, is more disliked.

  • avatar
    zoomzoomfan

    Most people I know won’t consider Volkswagen because of reliability concerns. Even people around here that know virtually nothing about cars will be quick to equate Volkswagen with frequent breakdowns, hard to find parts, and costly repairs. So, “dieselgate” just mad a bad situation worse around here.

  • avatar
    philipwitak

    re: “…Even the company’s “loyal ambassadors” — those people who can be counted on to defend “their brand” in public no matter what the controversy — are nowhere to be seen…”

    i am curious. just who are these ‘loyal ambassadors’ you speak of?

    • 0 avatar
      brettc

      I’ve been known to defend VW and talk up TDIs in the past to people. While the TDI technology is still impressive, I no longer feel a need to defend VW when people make fun of them.

      They dug a hole 8 months ago (really longer than that but it wasn’t public then) and they are still digging for some bizarre reason with their lack of communication. Probably the only way I’ll get another VW is if they pay me to take one.

      It’s too bad because I like the cars overall and they make some nice engines that just happen to turn into maintenance nightmares after a while.

      • 0 avatar
        Luke42

        For those who don’t recognize brettc’s avatar, it’s the glowplug light that you see.on the instrument cluster when you start a VW TDI.

        For those of is who’ve owned a VW TDI, it’s an instantly recognizable shibboleth.

        The rest of his tribe hang out at tdiclub, vwvortex, and similar. I did too, back when I was a VW enthusiast.

        • 0 avatar
          mustang462002

          TDI Owner here.
          I took a risk on buying a VW TDI. I knew the issues with the HPFF blowing up and intercooler icing. So far I’ve had:

          -3 dealer visits for noise in axle. Car had 4000 miles. Fixed after dealer used microphones to pinpoint noise.
          -ratle in stereo head unit 10000 miles.
          -at 15 miles rear window did not work
          -1 intercooler icing. Fortunately just cranked and did not hydrolock my engine. Learned what had happened after the fact.
          -Speedometer needle vibrates at speed.
          -Wiper relay makes clicking sound when on.
          -Click when going into 5th gear.
          -Gear shifter is starting to feel like a bucket of bolts.
          -I keep all my diesel receipts expecting an HPFF.

          Might trade in for a GTI or Golf depending on deal.

          Yeah I should know better. But they are great looking cars and I can’t get over the 80 mph torque and Autobahn composure.

  • avatar
    Kendahl

    Rebuilding VW’s reputation implies that they had a good one prior to the diesel scandal. Three years ago, when my wife and I were shopping for what became a 2013 Focus, VW wasn’t a candidate. I had read many places that their cars are great to drive but break too often and are expensive to repair.

  • avatar
    LIKE TTAC.COM ON FACEBOOK

    VW has a reputation to rebuild. How to do it:
    – Offer an all-inclusive bumper-to-bumper warranty of at least 100,000 miles, a la Hyundai.
    – Improve dealer experience, so a VW dealership is an attractive place to go to. Treat all customers as if they were at a Lexus dealership.
    – Build vehicles with Toyota or better quality. After all these years, there should be some know-how about reliability.
    – Price your vehicles so competitively that they become a must-see choice for all car buyers. Price points work great: Under 15,000/Under 20,000/Under 23,000/Under 30,000, etc.
    – Include free roadside service. Make it as well-known as AAA.

    Much of this could be funded by reductions in the multi-million dollar bonuses paid to VW executives for piloting their sinking ship across the rocks.

  • avatar
    seth1065

    Most people I know would not care and do not know a ton about cars and would buy a VW. But most of their lineup is either old or sells better when gas / fuel is high so that is also part of this. yes they seem clueless about the US market well before diesel gate , no competitive product that the US wants , CUV, SUVs and Pick up trucks, when they redid the Jetta and Passet they sold pretty well, they are old now and need a refresh that folks can see , in the VW empire the US is a very small player and will remain that way , until they make cars we want, their reliability numbers are middle of the pack so that is not really a issue. All it takes is one good product at the right time and sales will come back , see the rise of the outback, right product right time, and plenty of folks want then regardless of the head gasket issues.

  • avatar
    Sjalabais

    The institute’s ratings above have one massive failure, seen with the eyes of a statistician: They choose people who are familiar with, yet unaffiliated to a brand. They choose people who care.

    Most of us here can attest to a vast majority of people in our networks not caring much about cars. They say and do as some opinionmakers may tell them to, but diesel cheating does not really affect them. In the end, they buy the cars they want anyway, and who shies away from a good deal?

    That’s my experience, and the numbers other commenters have posted above attest to that.

    • 0 avatar
      tedward

      There’s also vw’s very schizophrenic fan base to consider. There’s people like me who buy them and modify them, your gli/gti/r crowd. There’s non educated image shoppers, either replacing Saabs or volvos. Then the environmental image shoppers, buying diesel bc of the ad campaigns. Thrifters for mpgs might get a category too, but probably as a subset of the environmental crowd or the sporty enthusiasts.

      Of those categories it’s the two image shoppers that vw will have a future problem with. Normal people don’t really fall into any of these categories.

  • avatar
    gasser

    VW doesn’t get the American market. We want more SUV/CUVs, they have a choice of too small or too expensive.
    We want a new model to actually look new, they sent us the 2016 Passat. We expect reliability, they engineer complexity.
    It will take years for VW to move beyond this issue and IF AND ONLY IF they solve their other problems.

  • avatar
    karonetwentyc

    If VW wants to rebuild goodwill with both its current and potential customers, there is one other thing it needs to do: get certified, non-cheating diesels back on the lots ASAP. And not just in the Golf, Jetta, and Passat – they need to be available across the entire range.

    Part of the current problem is that VW has – for the time being – dropped diesel like a flaming-hot dog turd and is doing their desperate best to minimise exposure to the fact that their diesel cars ever existed. Realistically, this is a mistake: their diesel sales were on a rise prior to the scandal, and they had a half-million (generally) happy owners of late-model TDis telling other potential customers how much they loved their cars. Twenty modern-day Doyle Dane Bernbachs couldn’t have generated that kind of positive publicity for Volkswagen.

    If, however, VW does have the intestinal fortitude to take this tack, they also need to be absolutely contrite – at least initially – in their publicising of certified diesels. Being absolutely up front about what they did, the impacts that their actions had, and how they want to repair that damage while still offering vehicles that fit their customers’ needs will have two effects: one, it will go some way towards mitigating the ill-will that their actions since the scandal broke have brought upon them; two, it will show that as a company they are strong enough to directly address and correct their mistakes without doing so at the expense of their customers.

    For persepctive: we have a 2012 Jetta TDi as our current daily driver, so expect to receive a letter with some sort of conciliatory offer from VW regarding their actions in the next couple of months. Assuming that one of those offers is a buyback involving replacement of our car with a gas-engined model, we’re disinclined to accept the offer.

    None of their gas-engined models have the driving characteristics we want in the daily driver vehicle, and without the ability to replace like-for-like we (much as any other purchaser of a diesel VW) are essentially being given an offer that leaves us with less car for the same money. That’s not a goodwill offer; it’s a lowball buyoff that will likely involve waiving all right to legal redress – so you’ll either take less car and like it, or keep your car and receive an offer for loss of residual value that’s probably not going to reflect the actual loss over the vehicle’s lifetime, just the loss at the point where the scandal broke.

    In fairness, the details of the settlement are still being hammered out so the above is most definitely speculation on my behalf. However, VW needs to recognise that they need to do better than just paying off their affected customers, and that demonstrating through their actions to both existing and potential customers that they are doing the right thing is what’s going to help them in the long term.

  • avatar
    hubcap

    VW will soldier on like it always has. In terms of customers, I don’t think this will have a long term impact.

    What’s more important to VW’s fortunes in the U.S. is producing and selling competitive CUVs. I’d like to see a small, medium, and large VeeDub CUV but if we only get the Tiguan and Touraeg, and they’re done well and priced competitively you’ll see a marked increase in sales.

    You know what’s funny. Honda knew about defective Takata airbags long before it was made public. Honda continued to use said airbags yet noone bats an eye or makes a whimper of such when discussing the brand.

    • 0 avatar
      Frylock350

      VW’s CUVs are hilariously overpriced. They’re asking Acura/Buick money for things that compete with Honda/Chevy. Look at the Toaureg. $43k for the base model? $50k for the ones actually on the lot? $54k for leather? Only engine is a 280hp V6? Seriously? What are they smoking? Its no wonder they don’t sell; they didn’t bother to see what the competition was offering for the same money.

      For a leather equipped Touareg at $54k I can get a leather equipped Chevy Tahoe 4×4. The Tahoe is a vastly superior vehicle. It literally does everything SUVs are supposed to better and unlike the VW its a real truck with a real truck chassis. It even gets the same real world gas mileage. Who in their right mind would choose a Toaureg over a Tahoe? Hell I can get a Sierra Denali with a 6.2L V8 for less than a Toaureg Lux. The 5.7L Jeep Grand Cherokee gets an honorable mention here as well.

      At the lower end of the Touareg’s price spectrum replace Chevy Tahoe with Toyota 4-Runner and the argument remains the same.

      • 0 avatar
        tedward

        Well not really. The touareg competes with the grand Cherokee, and usually has the v6 tdi as the other engine. It’s the same price as the gc once you go to similar drivetrain specs (otherwise get a v8 gc). This is exactly a acura/bmw positioned vehicle that should be acting as a halo for affordable vw suv’s. Vw’s problem isn’t that the touareg exists, it’s that they are still waiting on a suv lineup designed for the American market.

        The reason that class of vehicle exists is because luxury suv’s are a thing. They are platform distribution projects and subsequently, the ride quality difference between them and a Tahoe is a gazillion miles long. If you need to tow over 7000lbs but your needs also include luxury station wagon these are the answer. Think less luxury truck, and more luxury car that can do actually do truck things. I would think someone who appreciated a Tahoe would respect the only other type of uv that holds the line with tow capacity and longitudinal awd layouts.

  • avatar
    RobertRyan

    It may take a ” loong time” in the US, but seemingly almost forgotten outside NA. Sales are still very strong.

  • avatar
    SCE to AUX

    VW market share:

    2012 = 3.0% (#10)

    2016 YTD = 1.7% (#14)

    They’ve been trending the wrong way for a while. Poor reliability, pricing, product selection, and now the diesel scandal all add up to a tall hill to climb in the US.

    And that 1.7% won’t be the bottom of the curve, either. A lot of TDI owners won’t be re-upping for another VW when their settlement arrives, and they’ll tell their friends.

    • 0 avatar
      mshenzi

      Yep. I’m waiting to see what the offer will be on my 2010 TDI Golf, and have started daydreaming about possible next cars in the meantime. None is a VW, though I was a very happy owner til 8 months ago.

      The Golf’s size, configuration, ride, handling, and feel suit me very well, its gotten great MPG, and I’ve had both good reliability and a decent dealer experience with it. Hopping into another one would make sense on some levels, and the GTI is tempting, though i’d have to think about the HP/MPG tradeoff and potentially higher insurance costs. But at least for now I’m not daydreaming down that road. Don’t trust the company any more, hard to picture handing over more $ to ’em.

  • avatar
    05lgt

    Could someone please forward this paragraph to Cadillac?
    “Getting that emotional/feel-good back is going to take a long period of time,” said Hahn-Griffiths in a phone call with TTAC. “There’s no quick fix overnight. A lot of the love out of legacy was lost, and it’ll take a lot of effort to gain it it back … You can’t message your way out of the situation. You have to earn back reputation literally one potential member of the general public at a time.”

  • avatar
    VenomV12

    The scandal personally doesn’t bother me one bit, mainly because I don’t drive diesels, but even if I did, I probably wouldn’t care, I would still by a Volkswagen product. My Audis in the past were excellent vehicles.

  • avatar
    Johnster

    VW didn’t have all that great of reputation before the Diesel crisis. The cars are both comparatively expensive and unreliable. VW replacement parts also have a reputation for being expensive.

    The 2.0 Turbo has proven to be a gutsy engine, but the smaller 1.8 and 1.4 Turbo engines still need a while to prove themselves. It’s a hell of a mess.

  • avatar
    rocketrodeo

    As someone who was extremely unlikely to buy a Volkswagen ever again even before dieselgate, I think everything since the scandal has been upside. More than once, following yet another unnecessary wallet lightening at the hands of the VW service department, I had wished corporate death upon them — and it seems to be coming to pass. Schadenfreude is delicious. Possibly the most immediate benefit to the public from the hiatus in VW diesel sales has been the suspension of those annoying commercials with the lecherous old ladies.

  • avatar
    Storz

    A coworker and I both have cheater diesels. I am on my 5th VAG product and certainly after the buyback my last. He on the other hand is on his first VAG product and wants to buy a Jetta Alltrack or whatever its called post buyback. Different strokes I guess.

    • 0 avatar
      tedward

      It’s a matter of emotional investment it sounds like. There’s a good chance that five vehicles in a row means you were buying the brand as much as each car vs its competitors. He’s just bought a car that he liked and sees the vw scandal as just one in a never ending precession of auto industry cock-ups. Seriously, we hear this whole, “I’m done for life” thing from a percentage of owners on the tail of every scandal around here. With Toyota, ford and gm the stories sounded just like yours bc unlike hyundai/Kia they had multi generation, brand focused, customers.

      I personally just don’t get it, but maybe I’m the weird one. Why limit your choices? A car company would have be seriously morally depraved for me to write off their product, as in, carrying out extra judicial killings and relying on slave labor. EVEN THEN, I probably would consider being a customer if they made my perfect car. I’m not necessarily proud of that or criticizing you, I just find the focus on brand identity to be really interesting.

  • avatar

    “A lot of the love out of legacy was lost”.

    That’s it.

    I’m old, and remember well the outstanding Doyle Dane Bernbach campaigns upon which VW built its reputation in the US.

    Wilt Chamberlain trying – and failing – to fit inside a Beetle? Remember the caption?

    “They said it couldn’t be done. It couldn’t.”

    Implied message…WE’RE THE HONEST GUYS. YOU CAN TRUST US.

    See the evidence on YouTube. How does the snowplow driver get to the snowplow? He drives a Volkswagen.

    From the 60’s, WV has used ONE font…ONE…for its slogans and headlines. It was a subtle way of carrying forward that message from 50 years ago even though their cars have long moved on and many of them have lost the plot in a sea of unreliability and other issues.

    You could argue that Volkswagen had built itself a cult following.

    FAHRVERGNUGEN…SAY THE WORD!

    Sign, THEN drive…people would roll their eyes if they saw that at a Chevy or Toyota store. But it was part of VW’s perceived character.

    Until now.

    Ford, GM, even Mercedes wouldn’t suffer the damage to their brands that VW will suffer because their brand messaging is, and always has been, different.

    The endearing component of VW’s brand has been destroyed. Now they’re just another car company and the key to their survival will lie in building outstanding products with compelling marketing.

    Just like everyone else.

    And notice, next time you see them on TV…that they changed their font.

  • avatar
    Jasper2

    First Audi sells me a brand new 2011 Q5 with an engine that bleeds oil and has an exploding Takata Air Bag.
    Next they tell the world they are going to start building these Q5s in Mexico. Translation: pay German prices for the Q5 adobe.
    Now we have the diesel gate scandal and VW arrogance in it’s resolution.
    Screw VW and all it’s brands. Audi is just a goosed up fancy VW.
    VW: get the hell out of the United States before 2017 and take your f’ing southern factory with you.

  • avatar
    Jasbro1

    Don’t hold back Jasper, it’s not good for your blood pressure:)
    Talk about a Sophie’s choice- don’t spin on your oil, or you’ll get Claymored by the airbag…oh well, at least you’d get out of the vehicle!

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