Volkswagen vows to replace faulty Australian vehicles

Volkswagen Australia has pledged to replace vehicles deemed undriveable within 60 days of purchase, under a new court-enforceable agreement with the national consumer watchdog.

Under the ’60-day policy’ agreed with the Australian Competition and Consumer Commission (ACCC), Volkswagen Group Australia says it will go beyond what is legally required under Australian consumer law, replacing cars subject to a “major failure”.

The undertaking relates only to Volkswagen (not sister brands such as Audi or Porsche) and is separate to ongoing court actions concerning the ‘Dieselgate’ emissions scandal involving Volkswagen and Audi.

“We have successfully sought Volkswagen’s commitment to improve its complaints handling systems to ensure compliance with the automatic rights consumers have under the Australian Consumer Law, which cannot be excluded, restricted or modified,” ACCC Commissioner Sarah Court said.

“Today’s action ensures Volkswagen will place consumer guarantees under the Australian Consumer Law at the centre of their approach to consumer complaints, as every car manufacturer should do.

“We are pleased Volkswagen will offer its new car customers remedies in some cases beyond what the law requires and believe this positive step will be appreciated by new customers.”

The ACCC-VW agreement follows a similar arrangement with Holden, a voluntary undertaking by Hyundai and $10 million fine for Ford over its handling of the PowerShift transmission problem earlier this year.

And it comes in the wake of the consumer watchdog's new car retail market study, which “identified industry-wide issues with the way car manufacturers were handling consumer guarantee complaints”.

“We will continue to pursue manufacturers to ensure they are honouring the rights of consumers under the law,” said Court.

For its part, Volkswagen Australia says it will review past complaints and may offer refunds, replacements and repairs to customers whose consumer guaranteed rights have not been honoured.

"Volkswagen Group Australia welcomes the opportunity to co-operate with the ACCC at all stages of this process," the company said in a statement.

"This undertaking reinforces our existing obligations to customers. Volkswagen is the only car brand that publishes information on its website about the performance of each dealer based on the direct feedback of 80,000 customers annually."

The car-maker has agreed to have an independent expert review customer complaints, with customers to be provided with written reasons when a requested remedy is not honoured.

“For transparency’s sake, Volkswagen is developing a VIN checker for our website that will enable customers to see if any service campaign for their vehicle has been completed or remains outstanding,” Volkswagen added.