Volkswagen Fights to Regain Diesel Market in US
Following Dieselgate scandal, Volkswagen of America struggles to regain its diesel sales.
The market may be down, but despite the slight economic downturn, Volkswagen of America still reported a 1.6 percent sales increase for April 2017 (well above the industry average of -4.7%). It is also important to note that this is the first month Volkswagen was able to resume selling its regulated diesel vehicles since barred by the US Environmental Protection Agency from selling some diesel-powered vehicles in 2015.
To recap, In September of 2015, Volkswagen was exposed for having installed emission cheating devices in vehicles sold from model-year 2009 and on. The EPA and the California Air Resources Board slapped Volkswagen with $4.3 billion in penalties and led to criminal charges against six of VW’s executives.
Since the manufacturer was put through the ringer by both the EPA and CARB, it has worked to come to an agreeable fix that would address the concerns with all 475,000 2.0-liter vehicles that were recalled. As of January, 67,000 (or 14 percent) of vehicles received the approval for an acceptable fix.
The “new” vehicles are still labeled as model year 2015, and are sold with quite the steep discount of up to $8,500. Naturally, this incentive has attracted both new and repeat buyers to Volkswagen’s diesel fleet. What is impressive is that sales have managed to reach around 12% of Volkswagen’s total line up in April, despite the vehicles only being greenlit for purchases made after mid-April. The auto giant managed to sell 3,196 diesel cars in just a few weeks out of the 27,557 throughout the entire month.
Prior to the Dieselgate scandal, Volkswagen attributed nearly a quarter of its US sales to diesel cars alone. If identical sale patterns were to continue, the 12 percent of sales over half the month may add up to total that rivals its past numbers. Volkswagen continues to purchase and fix vehicles in order to meet its agreed upon threshold of 85% of vehicles being repurchased or repaired needed by 2019. In April, it repaired and additional quantity of 6,200 cars.
Volkswagen has shown that despite its scandal, it can still influence customers to purchase its diesel vehicles. If sales figures continue to increase on a regular basis, it may be fair to assume that Volkswagen can resume its large number of diesel sales in the United States. Only time will tell if this assertion is correct, but in the coming few months, a clear picture will be painted of its future.