Car News

Volkswagen apologises for poor handling of DSG recall

11 Nov 2013

Isaac Bober 6

Volkswagen’s handling of the DSG gearbox and other problems has almost become a case history on how not to handle customer dissatisfaction. It seems they may have learnt a valuable, albeit expensive, lesson.

By Paul Murrell

John White is the managing director of Volkswagen Group Australia. It’s probably fair to say that since he assumed the role in April this year, his has been a baptism of fire. Even before he took up the role, he was being emailed by dissatisfied Australian customers, seeking answers to their VW woes.

After some resistance, the company finally instituted a recall after a young woman was killed in Melbourne when her VW Golf was rear-ended by a truck on the Monash Freeway in 2011. Witnesses reported that the car slowed dramatically, without the brake lights activating and sparked complaints from other owners whose VWs had cut out or stopped on busy roads, reportedly due to a faulty gearbox operation. VW Jetta, Golf, Polo, Passat and Caddy models built between June 2008 and September 2011 were recalled, as were 1700 Skoda vehicles and 6000 Audi A1 and A3 models.

Major concerns were voiced that VW Australia had been tardy in recalling the vehicles, particularly since vehicles had been subject to a recall much earlier in Japan, Singapore and China. Some of the issues with the DSG gearbox had been addressed in the United States as early as 2009.

Another longstanding issue for VW owners has been a problem with the injectors on diesel engines. In Britain, the Vehicle and Operator Service Agency pushed Volkswagen into contacting customers and repaying thousands of pounds spent repairing faulty injectors. Despite being aware of the issue, VW waited until this year to begin a “silent” campaign in Australia to fix the problem. The matter was addressed only when a customer took their car in for a service at an authorised repair centre; owners who were having their cars repaired elsewhere were very much left to their own devices.

For some inexplicable reason, Volkswagen in Australia tried to keep a lid on the problem but once word started to spread, the reaction was swift and inevitable.

Now it seems the lesson has been learnt and VW is taking steps to ensure that it never arises again.

At the launch of the VW Golf GTI in Launceston in early October, John White faced assembled media to deliver a corporate “mea culpa”. He admitted that the dealer infrastructure in Australia has failed to keep pace with the remarkable growth of the brand and promised increased service capacity and improved dealer coverage in rural areas. “I acknowledge from a customer perspective, we need to do better,” he began. “My assessment is that, number one, we need to have quicker resolution of product issues. We are establishing new processes to do that. I have instructed our team to be more flexible with customers who have important issues, and recalled one of our management team from overseas to come back in the role of Customer First Manager. This person is presently putting together a set of standards and processes for all dealers to follow, so we have a more consistent customer experience across the network and a strong focus on training and dealer qualification.”

That kind of admission is not easy to make, and the personable John White should be commended for taking positive action to address the concerns of his customers. Some would argue that this action should have been taken earlier, and many VW customers have been vocal in calling it “too little, too late”.

The recent extension to five year warranties covering transmissions goes some way to allaying customer concerns, but the damage to the brand goes deep. Since dealers are the first point of contact for most owners, they need to understand the need to address problems quickly, honestly and transparently, and they have a right to expect the parent company to support them.

Volkswagen paid a high price for their attitude. According to figures released in early July, VW sold 1226 fewer cars than in the same period last year, a 19 percent drop in a market that has grown by 5.5 percent. Golf and Jetta sales were even harder hit, falling by more than 50 percent. At the October GTI launch, John White was able to report that VW sales had resumed the numbers achieved last year, with the primary sales drivers being Amarok, Transporter, Polo and Up!. He suggested that the group would aim for “more temperate, more moderate growth”.

There is a lesson here for all motor companies. Trust takes a long time to establish and can be quickly undermined. A car is a major purchase, usually the second largest any of us ever have to make. Volkswagen failed to treat its customers with the respect they deserved and they must now start the long climb back to regain the trust and loyalty they squandered so profligately.