Monday, October 5, 2015

Volkswagen 2

In the eighties and nineties Volkswagen suffered from slow sales amid quality issues.  The bad news continued into the early 2000's as VW continued to quality issues as well as delays in introductions of new models.  In the mid 2000's VW started to show some signs of life.  Their quality issues began to fade and with the introduction of the 2006 models their fortunes made a turn for the good.  In 2009, VW introduced the common rail diesel technology.  They were betting on this technology to increase their sales to meet the target prediction of 800,000 vehicles sold in North America by 2018.

VW continued to push the dealer body to remodel their facilities, add shop space and parts area for the coming onslaught of service work.  At the same time, VW was improving some in the annual JD Powers study that ranks manufacturers.  Slight improvements brought more push from VWoA on the dealer body to comply with all kinds of standards as well as have a Customer Satisfaction Index (CSI) equal to or better than the national dealer average in order to qualify for bonuses and trips sponsored by VWoA.

A customer who didn't like their vehicle could easily torpedo a dealerships CSI report.  While some dealerships seemed to excel at getting good CSI others struggled as customers were bombarded with phone surveys nearly every time they visited the dealership for any kind of service work.  I can tell you from experience it was a day to day struggle working with an autocratic company to try and get any kind of results or help.  Instead of looking at their dealers as partners they insisted that everything be done their way.

Now VW has been caught in a scandal.  They have admitted wrong doing.  The dealers are left with vehicles they can't sell and the future looks bleak at best.  As with the CSI reports where the dealers many times were broadsided by a customer that was actually upset with the manufacturer, the dealers are being blamed by some for the debacle that Volkswagen has created.  They aren't the bad guys.  Volkswagen did this to the dealers as well as their customers.  Now the franchise dealers are left to try and pick up the pieces.

In my experience, Volkswagen has never been an easy manufacturer to deal with as a franchised dealer.  I wish all the dealers the best and hope that some how this can be turned around and fixed.  I hope that VW evaluates their strategy in North America and becomes more of a partner with their dealers and less of an adversary.  VW does build some fun cars to drive.

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