Scout Motors has been the object of car dealers’ ire from the beginning. When the Volkswagen-owned startup emerged in 2022 with sketches of electrified trucks and SUVs, it disclosed its plan to sell directly to consumers. Auto retailers fired back, and shortly after Scout revealed its Traveler and Terra concepts in 2024, they began gearing up for a legal fight. Two VW stores filed a class-action lawsuit against Scout earlier this month, though despite that, the brand’s CEO Scott Keogh insists that sidestepping dealers is the right move.
Keogh spoke to a group of media at an Automotive Press Association event in early March. In explaining Scout’s direct-to-consumer sales model, he said the idea “is to offer a great experience to the customer.”
“You would only do something if you can make something better—at least, feel you can make it better,” Keogh continued. ”Otherwise, it’s not worth doing. So 100% right there. We want to offer a different and better customer experience.”
Some VW dealers believe that Scout is legally obligated to sell its products through their stores. They have the North American Dealer Association on their side, as NADA CEO Mike Stanton said the collective would fight for its members “in courthouses and statehouses across the country.” However, Scout Motors’ legal counsel later made clear that the brand “will not do business with anyone that threatens or tries to intimidate it, either directly or indirectly.”
Keogh went on to explain the inefficiencies in the automotive industry that once worked but no longer do.
“I think there’s no debate that the system now is inefficient,” he said. “And I think, historically, the automotive business could handle all sorts of inefficiency, because there was so much profit there. You could have inefficient plants, you could run 18 Super Bowl ads, you could have holding company advertising agencies, all sorts of markups and inefficiencies everywhere. Now that is over.”
In Keogh’s mind, the more control Scout has over its processes, the better.
“We feel that we can also get much better insights on the vehicle itself,” he explained. “So we have OTA (over-the-air) from the vehicle. That’s going to tell us a diagnostic exactly what’s going on with the car. We will get the insights from the technicians. We will take those insights from the technicians, deliver it right into the factory, and in super real time, make the decisions on quality, and make this thing on that front.”
Ultimately, Keogh says the consumer should be able to decide what’s best for them.
“You all know what’s happened is a lot of companies want to control their retail experience, and whether it’s Apple and what they’ve done, whether it’s Amazon and bringing cars right to your driveway. But the American consumer is quite adept,” he said. “And what do I think at the end of the day? I think at the end of the day, for America, the American consumer will decide. If we do a good job, we should be proud of ourselves. If we don’t do a good job, then another model was better, and that model beat us. Full stop, period. They did a better thing. So I think competition is a good thing. I think innovation is a good thing. And I think letting the American consumer decide… [these] are all good things.”
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