VW recalls previously sold, non-road legal prototype vehicles

Stefan Menzel, Martin Murphy, Dietmar Neuerer and Volker Votsmeier, writing for Handelsblatt:

“From 2006 to 2018, Volkswagen sold around 6,700 test cars in Europe and the US, a VW spokesman said, confirming German media reports. Around 4,000 were sold in Germany and the remainder in the rest of Europe or North America.

The cars, made to test and showcase new models before the launch of large-scale series production, should officially have been scrapped, but instead VW sold them as new or second-hand cars. The problem: motor transport authorities never approved these test models, only the ones produced in series.

Some models only needed a software update or a new navigation system to make them compliant, but others were so different from production cars, their only destination would be the scrap yard. VW explained that potential safety issues were the reason for the recall.

The matter has been deemed a serious offense by local authorities and the German Transport Ministry is deciding whether to fine VW a couple of thousand euros per test vehicle sold. Legal experts said VW may also face lawsuits, because consumers bought cars which may not have met the criteria the carmaker promised. 

VW's own dealers are also angry. "Yet again we have to compensate the customer for damages that actually originated in Wolfsburg," said one car seller in southern Germany.”

This is, frankly, appalling. It’s unbelievable that one of the world’s largest car companies had, for 12 years (!!), no way of clearly distinguishing prototype and pre-production vehicles from production cars.

From a company as established as Volkswagen, it’s obvious for the customer to expect a certain standard of quality and a guarantee that the car will perform as marketed. Thus, having a potential range of issues as broad as simply needing a software update, to poor quality or non-compliant parts, likely worsens the situation for the customer by creating an additional air of uncertainty about the potential safety risk of the vehicle they’re driving. It appears that the customer has no further knowledge about whether their car might require a software update or substantial structural repairs/replacing.

As Volkswagen franchisees, this news will also have an adverse impact from a dealership point of view. Dealerships are typically the first port of call for the customer. Not only will they be responsible for providing compensation (hopefully VW corporate compensates them back) and going through the expense of organising, handling and repairing/replacing affected cars, but they will also share some of the ‘bad blood’ generated from this scandal through no direct fault of their own.

For Volkswagen itself, this episode further drags VW’s brand reputation through the mud, compounding problems for a company still reeling from the ‘Dieselgate’ saga. Whilst 7,000 or so cars over a 12 year period may seem minuscule compared to the millions of cars that the VW group sells annually, this news is sure to have an outsize impact on the brand’s previously heralded reputation for quality and safety.