Tag Archives: VW recall

Damage Control in Business: A VW Scandal Update

sorry heart

VW Says “We’re Sorry” With Gift Package Valued at Over $1000.

Business is part of life, and with that comes ups and downs.  At the end of the day, we are all human beings and by nature, imperfect and make mistakes.  In business, a simple mistake or poor decision can affect hundreds, thousands or potentially millions of people.  Minimizing damage control can be an extremely difficult undertaking, especially if you or your company was unable to proactively prevent the transmission of and correct the mistake or poor decision to employees, clients or even worse, the media.

A perfect example of this is the VW Recall, later known as the “VW Scandal”.  The former CEO of VW Martin Winterkorn, had approved the decision to install software on over 480,000 “clean” diesel vehicles in the US between 2009-2015. This software only activated the cars’ pollution controls during emissions testing (while on a hoist) which prompted a world-wide recall of nearly 11 million vehicles. This was obviously a fraudulent means to pass the rigorous EPA standards in the US and will end up costing VW up to $18 billion.

Unfortunately for the sales force at VW, they had no idea this was happening behind the scenes until they literally heard it on the news before they came in to work that day.  For the full story of the immediate impact on the sales force, read my interview with Aaron Hansen, Sales Manager at Cambridge Volkswagen, “How Poor CEO Decisions Impact Sales Reps: The VW Recall”.

VWGiftCard

So now, 4 months later in an attempt to say “We are sorry”, VW has provided all affected TDI owners such as myself with a compensation package.  This includes a $500 credit at a VW dealership, a $500 MasterCard gift cart and 3 years of free road side assistance. Furthermore, the recall on my vehicle will be fixed at no charge or inconvenience to me.

As a loyal VW owner, I think this more than compensates for any wrong doings on their part.  As I have mentioned previously, I never bought my car so that I could drink water out of my tail pipe.  I bought my Passat TDI for comfort, safety and fuel economy among other reasons.

Do I accept VW’s apology?

I most certainly do.  And I must say, the timing couldn’t be better, being just after Christmas and before Valentine’s day.

Will I remain a loyal VW/Audi customer?

Absolutely.

Overall, although VW should have given their sales force a head’s up about all the negative press they were going to receive in the media and prepare them with how to handle customer inquiries and complaints, they made up for it after the fact.

In speaking with the reps at my local VW dealership, sales are back to normal.

Just goes to show that regardless of the severity of the “damage” a business succumbs to or has brought onto themselves, it is possible to recover with the implementation an aggressive damage control program.

If your business is in a similar situation, you should consult a PR expert and ideally one who specializes in your field of work.

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How Poor CEO Decisions Impact Sales Reps: The VW Recall

An Interview with Aaron Hansen, Sales Manager at Cambridge Volkswagen.

Volkswagen-TDI

If you are a sales representative, sales manager, or other front-line staff, there is nothing worse than finding out the head of your company made a huge mistake that reflects poorly on your company.  In some cases, you may have a head’s up of the bad news and have time to prepare, be proactive and inform your clients directly before they find out from a 3rd party, however this is not always the case.

As most of you are aware, Martin Winterkorn, the recently resigned CEO of Volkswagen, had approved the decision to install software on over 480,000 “clean” diesel vehicles in the US between 2009-2015. This software only activated the cars’ pollution controls during emissions testing (while on a hoist) which has now prompted a world-wide recall of nearly 11 million vehicles. This was obviously a fraudulent means to pass the rigorous EPA standards in the US and will end up costing VW up to $18 billion.

Most certainly, this is not the first scandal of its time, especially in automobile history.  In my opinion, the majority of large corporations are guilty of some sort of fraudulent activity, just not all of them get caught.

Where I feel pain, is for the sales people.  They had no say in the executive decision whatsoever yet have to deal with the wrath of chaos the CEO’s have created for them. No matter how bad the news, the sales reps have to suck it up, put on a happy face, keep smiling and continue selling.  I have been there and it’s not easy.  For those of you who are in this situation, I would recommend reading my previous article on The Rumor Mill: How to Grind it to a Halt Before it Hurts your Business.

In this article, I have interviewed Aaron Hanson the Sales Manager at Cambridge Volkswagen here in Canada to get his take on the incident and how he and his sales force are handling the matter.

TSW:How did you find out? Did you have any advanced notice or time to prepare?”

AH: “No head’s up at all.  I saw it on the news the morning before I came into work.”

 

TSW: “How did you and your team react to the news?”

AH: “We were all stressed initially but the fact of the matter is, we sell the cars, we don’t build them. This is not the first or the last time this has happened to a car company. Regardless of what it is in the news, VW is still a great brand that we all have faith in.  We have always and will continue to focus on great customer service. It is a small upset so we just persevere, with smile!”

 

TSW: “How do you stay positive?”

AH: “Easy, we are still alive! It is what it is.  Only 30% of our sales were TDI models and the rest were gasoline powered.”

 

TSW: “How do you feel this news will impact sales now and in the future?”

AH: “Unknown. It is only 5 days in, so it is too early to tell.”

 

TSW: “What sort of message have you been relaying to new and existing customers?”

AH:  “All our TDI customers (whose contact info we have in our database) were contacted immediately. We sent everyone a message informing them of the news, if their vehicle was affected and encouraged them to call us with any questions and concerns.”

 

TSW: “What kind of responses have you been getting?”

AH: “99% Positive. Almost everyone took the time to reply and say thank you for the follow-up. They were really appreciative of the proactive approach that we took.”

 

TSW: “What have you been saying to new potential customers who come into your dealership?”

AH: “We are completely upfront with them from the get-go.  So far, none of them are really concerned. They all still want to buy! The primary reason people buy our diesel vehicles is because of the fuel economy and they buy from us because of our excellent customer service.”

 

TSW: “Since your reps are 100% commission based and have specific monthly quotas for different vehicle types (diesel, gasoline, used), will you still be upholding those targets or adjusting them?”

AH: “Right now, it is unknown how this news will impact sales because it is too early to tell.  That being said, we are being flexible and seeing how and if sales will change.”

Based on my interview with Aaron, I think he is doing the best a sales manager or representative could do when faced with this particular situation. If you find yourself in this situation, I recommend you follow this example.

Aaron has been my sales rep at Volkswagen for the past 10 years.  I have purchased 3 cars from him, 2 of which were TDI’s, so am I concerned about my TDI vehicle or the VW Brand?

No.  I am a trusted and true VW fan and as I said previously, most major corporations lie and engage in some sort of fraudulent activity and so did VW. So what? What else is new?  I still love my car and I still stand by the fact that I think the VW Passat TDI is the #1 Vehicle for Sales Reps.

I did not buy my car for “green status” which it was never eligible for here in Canada anyway.

I did not buy my car so that I can drink water out of the exhaust.

I purchased my VW Passat TDI because of the fuel economy, handling, comfort and because of the excellent service I have always received from Aaron and staff at Cambridge Volkswagen.

A great sales rep can go a long way, and in most cases can be more important to the consumer than the company they represent.

I would love to hear from other sales reps about how you have dealt with a similar situation where your company has received some negative press and what you and your team did to overcome that.

Happy sales my friends.  Remember, even when times get tough, keep persisting and keep positive no matter how hard it may be.

Cheers,

TSW

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