Volkswagen to ‘redefine’ brand in wake of emissions scandal

LAS VEGAS,  Leaders of the German automaker Volkswagen told a dealer conference the company plans to “redefine” its brand to American consumers in the wake of its emissions scandal and slumping sales.

Herbert Deiss, international head of the Volkswagen brand of vehicles, speaks during the Consumer Electronics Show in Las Vegas in January. Deiss said Friday the company would “redefine” its tarnished brand in the United States after an emissions scandal emerged in September. Photo by Molly Riley/UPI | License Photo













Herbert Deiss, the global head of the Volkswagen brand, told reporters after a meeting with many of the 650 Volkswagen dealers across the United States, the company will seek to offer a new take on the German cars after the company was found to have sold 600,000 high-polluting vehicles rigged to cheat on emissions tests.

Deiss said the company is preparing to lower prices and retool its fleet of offerings, after dealers encouraged them to do so.

“We are working to redefine the Volkswagen brand in the United States by strengthening our management team, our partnerships with dealers, and our product portfolio,” Diess told reporters after the meeting. “We want to grow the volume consistently beyond past levels, and we will do this with our partners, the dealers. More than ever, we will include their ideas and their requirements into our decision-making.”

One dealer present in the meeting described the new appeal as “price-competitive German engineering.”

Sales for Volkswagen have tanked in the wake of the emissions scandal. Last year, the automaker sold about 379,000 cars and trucks in the Unites States. The company has said it needs to hit about 500,000 vehicles sold annually in order for the company and its dealers to make an acceptable profit.

Volkswagen has already begun stepping up efforts to make their vehicles more affordable. The company has increased discounts and rebates by 20 percent and now offers discounts averaging $3.589 per vehicle, nearly $500 over the industry average.

Dealers have also called for new offerings, including a large sport-utility vehicle to compete with the Jeep Grand Cherokee and a smaller, compact SUV. Dealers also want to see a price cut to the Passat family sedan, which retails for about $4,000 more than comparably equipped cars like the Toyota Camry.

The emissions scandal is still a fog of exhaust hanging over the company. A federal judge in San Francisco set a deadline of April 21 for the company to come up with a plan to get the over-polluting cars off the road. Volkswagen still has not said how it will compensate customers who bought the cars, or what it will do for dealers who have lost business as a result of the scandal.

At the dealers convention in Las Vegas, principles voted to appoint a five-member board of dealers to negotiate a settlement with Volkswagen. Both sides said a negotiated settlement is preferable to litigation brought by dealers angry over the hit they’ve taken as a result of the scandal.