... AND VW’S HAS POTHOLES, TOO
VOLKSWAGEN sales dipped last month in the wake of the emissions scandal but don’t expect the German maker to discount its way out of trouble.
VW October sales were down 6 per cent. That compares with 12 per cent growth in the first nine months of the year. Worse still, senior dealers suggested showroom traffic was down 25 to 30 per cent last month.
Local boss Michael Bartsch says the outlook isn’t as dire as it seems. He says passenger car sales were up slightly on last October, with commercial vehicles bearing the brunt of the slowdown.
“It’s knocked a little bit of the wind out of our sails but the business and our brand reputation are generally holding up,” he says.
He says there won’t be a fire sale to move metal again. “There’s no doubt we have to focus on our core attributes and rebuild trust in the market but the key thing is not to panic. We’re not going to fall back on a distress (selling) strategy. That would be the wrong thing to do to our existing customers.”
But news some petrolengined cars are also under a cloud is likely to dampen enthusiasm for the brand further, especially given there is no solution yet.
Dealer sources say they’re being told the fix is likely to be complex, with thousands of possible combinations of software changes required.
Bartsch agrees the nature and implementation of the fix is crucial to bouncing back. “Ulitmately we will be judged by how we treat our existing customers,” he says.
A senior market researcher agrees. Problems with the company’s DSG gearboxes “barely dented” enthusiasm for the brand, he says.
But there is an obstacle. VW does poorly in customer experience surveys, with results “nowhere near the Koreans or Japanese”.
It’s a baptism of fire for Bartsch, who has barely been in the job a month.