Tag Archives: Business

Volkswagen Recall

Volkswagen agreed to a $14.7 billion dollar settlement  to emissions cheating scandal:

Volkswagen Recall: The settlement is only a preliminary step in the case; the automaker still faces possible criminal charges, as well as civil penalties for Clean Air Act violations. The Department of Justice is investigating possible criminal charges against both the company and individuals, said Deputy Attorney General Sally Yates.

Volkswagen’s wrongdoing constituted “the most flagrant violations of our consumer and environmental laws in our country’s history,” said Yates. “We cannot undo the damage that’s been done to our air quality, but we can offset that damage.”

http://money.cnn.com/2016/06/28/news/companies/volkswagen-fine/

HOW DOES THIS EFFECT DEALERS?

In a nutshell, it is unknown and there is friction between the dealers and VW. For more information, please take a look at the links below.

http://www.autonews.com/article/20160606/OEM/306069960/manufacturers-and-dealers-must-resolve-recall-cost-disputes

http://www.autonews.com/article/20160425/RETAIL07/304259957/vw-dealers-want-remedy-done-right

In short, this situation is a mess and will most certainly affect the brand, and in turn affect dealership sales.  Unfortunately, there are no clear-cut answers at this point. The most effective way to ward off litigation is to have open communication with your customers and maintain a good “bedside manner”.  Clear communication will go a long way with your customer base as well as retain the good will that you have worked so hard to build.

People will forgive and forget VW’s mistake the same way they did the Ford Pinto scandal in the ’70’s although that situation and this could be considered comparing “apples to oranges”

In any event, VW dealers should be diligent in their efforts to lessen the blow that this will have on their business. Like any other situation, good people, good communication and hard work will prevail.

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If you are a car dealer and have concerns about legal matters, please contact my office.  For more information, see: http://speddinglawoffice.com/automotive-law/