Recall 'crisis' behind us, says Volkswagen

Volkswagen believes the reputation of its brand has recovered from last year’s damaging recall fiasco, in which 87 per cent of affected vehicles have now been rectified.

The German giant recalled almost 26,000 Polo, Golf, Golf Wagon, Golf Cabriolet, Jetta, Passat and Caddy vehicles in Australia last June to fix a potential fault with their DSG automatic transmissions.

The recall occurred amid claims it was slow to react following similar safety recalls in the US, China and Japan, and during a high-profile coronial inquest into the 2011 death of a Melbourne woman in a manual Golf GTI. The vehicle was not part of the recall and the coroner found Volkswagen played no part in her death.

However, internal and independent surveys showed the Volkswagen brand took a significant hit in terms of both brand perception and customer satisfaction following the recall action, which the car-maker’s Australian chief now describes as a crisis that is behind it.

Speaking at this week’s launch of the new Golf R and GTI Performance models, Volkswagen Group Australia Managing Director John White said an internal brand perception study, which surveys up to 1000 people a month, shows VW’s public reputation is as strong as ever.

“We’re back to pre-crisis levels,” he said. “We had a trough in August, but we’ve returned to the level we were before that.

“Based on that data, I’d suggest we’re back to where we were on an overall level. It’s been a long road.”

While the recall involved the replacement of mechatronic control units and software updates for the DSG transmissions in all affected cars, White said Volkswagen had been more generous than usual in addressing customer complaints beyond the recall.

“We’ve been much more liberal with our customer care policies and I believe that’s worked,” he said.

Despite the upturn in brand perception data, White said Volkswagen still had work to do in relation to customer satisfaction, particularly when it comes to servicing.

He said the relatively slow growth in infrastructure across Volkswagen’s dealer network had not kept pace with the brand’s rapid sales growth, impacting key buyer satisfaction metrics including the influential JD Power Customer Service Index (CSI) Study, which measures aftersales service satisfaction.

Last year Volkswagen ranked behind 11 other mainstream brands in the CSI study, and dropped 14 points from its 2012 result to a new low of 743 out of 1000 – 40 points below the industry average.

After placing equal fifth (but still below the industry average) in the inaugural 2010 study, it was last in 2012 and second-last in 2011.

Between 2009 and 2012, Volkswagen’s Australian sales increased from just over 30,000 sales to almost 55,000.

To address those issues, White said Volkswagen Group Australia had established a new ‘customer first committee’, headed by a new manager recalled from China, and will encourage dealers to invest in more service infrastructure, including off-site ‘satellite’ service facilities.