So I finally heard from him. He wanted to talk about our relationship. He said he had good news and bad news. Typical.
“Him,” as you may have guessed from my last post, is VW’s invisible spokesman for the notorious diesel emissions scandal, which broke last September and, 10 months later, is finally on its way to resolution. For diesel owners like me, the settlement announcement on June 28th was indeed good news and bad news. Good, because it includes cash incentives as high as $10,000 per vehicle. Bad, because anyone considering another make will now have a really tough time walking away.
No wonder I feel trapped.
Here’s the gist: Volkswagen has agreed to pay $10.03 billion to buy back roughly 500,000 American “clean diesel” car models built this decade – and some as far back as 2009 – at pre-scandal values. In addition, VW will give owners cash incentives for the affected vehicles to the tune of $5,100 to $10,000.
Owners can opt instead to have their rigged engines repaired to meet emissions standards, but doing so will more than likely compromise both performance and mileage. What’s more, the fix is still subject to EPA approval.
In a statement to the New York Times, David M. Uhlmann, a former chief of the Justice Department’s Environmental Crimes section and a University of Michigan law professor, said, “It’s hard to see why consumers would want to take advantage of the fix and not the buyback option, unless they just love their cars.”
Roger that, Mr. Uhlmann, but I would hasten to add there are degrees of love. I, for one, happen to L-O-V-E my 2013 Golf TDI, but I am not about to go through the hassle of getting it fixed. For one thing, to my ear, that sounds a lot like fixing a cat and almost certainly results in the same outcome – that is to say, a profound reduction in performance. For another thing, I bought my “clean diesel” vehicle, because I have a mega-commute and it offered exceptional gas mileage. Three years and 130,000 miles later, there’s hardly an upside to getting it “fixed,” even though it could easily go for another 100,000 miles or more.
Now let’s talk environmental damage.
I haven’t even mentioned the environmental damage VW has done and that all of us unwitting VW owners have been a party to by driving these unclean diesels. When you add in the $2.7 billion Volkswagen has agreed to pay the EPA to make up for the environmental impact, the price tag on this scandal just continues to soar. On top of the EPA fines, Volkswagen has apparently also pledged to spend $2 billion developing new cleaner vehicles.
Altogether, VW’s civil settlement is the largest ever by an automobile company, well in excess of the $1.4 billion Toyota paid out for its class-action lawsuit over defective accelerators or even the $2 billion GM has paid for its faulty ignition switch debacle.
The New York Times and the automotive press have all reported that VW’s civil settlement will probably end up closer to the $18.7 billion agreement British Petroleum reached in 2015 to settle claims stemming from its 2010 Gulf of Mexico oil spill. Prior to the VW diesel case, BP’s civil settlement was “the largest with any single entity in the nation’s history.”
Volkswagen has already set aside $18 billion to cover fines and compensation to owners in the civil suit. But sadly, it’s not enough. VW’s legal problems only go on from there.
The automaker is also in hot water with the Justice Department, along with attorneys general in almost every state, for defrauding consumers. VW is feeling the heat from financial regulators in New York and other states as well, who are investigating whether the company overcharged consumers who leased or financed their diesels.
The next best thing to divorce?
For those of us who are in this sham of a relationship with Volkswagen, this latest news brings some sense of justice. I just wish I didn’t have to hear it in dribs and drabs from the media. It feels like everybody’s talking about our relationship except V-double-dealing-you and me. It’s hard enough to trust a brand that deceived its customers so blatantly. An email every once in a while or a good old-fashioned letter in the mail would have gone a long way toward winning me back over these last 10 months.
Instead, I’ll probably tip-toe back into a dealership this fall and drive away with yet another Volkswagen, like some scorned woman who takes her man back knowing he’s been committing crimes of passion for years.
Our relationship will never be the same, and that’s so disappointing. After all, we go way, way back, VW and me. In my lifetime, I’ve owned at least a half-dozen models and have always been an enthusiastic brand evangelist. I’ve even helped VW build this brand on a professional level, having worked on the advertising business for five years.
I also find it unsettling that VW has done little to support dealers in this whole situation. And, as reported in an excellent recent article in ZDNet, that gives dealers no added leverage to retain their customers’ business. No free extended service contracts. No markdowns on new purchases. No reason for existing diesel owners to stay loyal to VW, except the government-imposed bribe and blind faith.
It’s hard to accept this sad state of affairs, but I know this, VW: No matter how much money you throw at me, or how many promises you make, you’ll never have the upper hand again.
Do you own a VW diesel and feel the same way? Tell me about it. We’ll feel less stuck if we stick together on this.
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Oh, Volkswagen, what are you doing to me? Yes, me. It’s no longer merely global. It’s personal. Because the longer you take to resolve the emissions issue, the more I feel like a jilted lover.
Oh sure, you’re still with me, but you’ve abandoned me emotionally. You keep saying you’re going to change. You’re going to fix everything. But you don’t. You just keep asking for more time.
Of course, it’s complex! The best relationships are! I just don’t understand how a brand like VW could let its valued customer relationships languish like this. So what if “the recall was delayed by several months as the KBA motor vehicle authority insisted the fix have no impact on fuel economy”? I get that, but what about the impact on our relationship???
o, I didn’t make the TV commercials. But I made enough of everything else to become convinced this brand was really special. The cars had style and personality. They were “German-engineered” and fun to drive. They were packed with premium standard features. And they scored consistently high on value.
ake of this sad new twist in the saga and the “culture of mistrust” it continues to perpetuate. VWoA’s national dealer council president, Alan Brown, says dealers have invested over $1 billion in showroom upgrades for the automaker and feel betrayed by its mishandling of the scandal.
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