September 25, 2015

Transparency in Dealerships

Volkswagen can tell you that Warren Buffett had it right when he said, “It takes 20 years to build a reputation and five minutes to ruin it.”

Volkswagen is reeling in the wake of their recent emissions scandal.

For those who haven’t read about it yet, here’s a brief and non-technical breakdown:

Volkswagen had software set up in their systems so their diesel models knew if they were being emission tested or not. When being tested, the system was programmed to cheat and would show the results as being compliant. During driving, though, the software was turned off and allowed forty times the emissions it was suppose to allow. Tests were falsified on a staggering half a million VW and Audi diesal cars and an estimated 11 million vehicles worldwide.

Impropriety of this scale not only ruins the reputation of Audi and Volkswagen, it also puts every manufacturer under scrutiny.

“I am shocked by the events of the past few days,” read CEO Martin Winterkorn’s statement, in part. “Above all, I am stunned that misconduct on such a scale was possible in the Volkswagen Group. As CEO, I accept responsibility for the irregularities that have been found in diesel engines and have therefore requested the supervisory board to agree on terminating my function as CEO of the Volkswagen Group. I am doing this in the interests of the company, even though I am not aware of any wrong doing on my part.”

Volkswagen has been forced to allocate $7.3 billion to cover the costs of the scandal, but the final could be many times that amount.

It remains to be seen what Volkswagen will take away from this misconduct of economic proportions. Trust and integrity are everything in the automotive industry. While it’s a very expensive lesson for Volkswagen, it’s a free one for other automobile manufacturers and dealerships.

From sales incentives offered to service and parts recommended to customers, transparency and honesty in all of your business dealings is crucial.

By Jenny Hammond, DOM360 Social Media Coordinator

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