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The VW Settlement: 10 Crucial Things Dealers Need to Know

vw settlement

Volkswagen’s error has cost the company billions of dollars, but the VW settlement could mean profit for your dealership if you follow all the rules.

Until recently, Volkswagen had a pristine reputation in the auto industry. They were viewed as a reliable, trusted brand with a legion of loyal followers. Unfortunately, the company found out firsthand what happens when you lie to consumers — a lot of negative publicity and a multi-billion-dollar VW settlement.

VW has earned a top spot with the Federal Trade Commission (FTC), but it’s not for any of the good work it’s done. Volkswagen holds the distinction of being the largest false advertising case in FTC history. In September 2015, the Environmental Protection Agency (EPA) discovered that many VW cars being sold in the U.S. had a “defeat device” installed in diesel engines to cheat emissions tests. These are the same cars marketed by VW in a massive campaign that touted their low emissions. VW has now admitted that about 11 million cars worldwide were fitted with the “defeat device.”

A year later, in fall of 2016, a VW settlement went into effect to get justice for some Volkswagen and Audi owners. Volkswagen has agreed to pay up to $10 billion to owners and lessees of VW and Audi 2.0-liter diesel cars it falsely claimed had low levels of harmful emissions.

As a car dealer, you have the opportunity to benefit from the VW settlement — but you need to know the rules, so you don’t end up in trouble as well.

vw settlement

The fine print: What your team has to know about the VW settlement

The VW settlement is a big deal, so if anyone is working at your dealership that doesn’t know about it, you need to make sure they do. Nothing will discredit your industry expertise faster than having an employee that’s unaware of one of the biggest auto manufacturer blunders of all time.

Prep your staff for how to handle customers that come in with questions about the VW settlement, or have received their settlement and want to buy a new car. Here are ten things you need to know:

1. Everyone has to start at

This website is the hub for the VW settlement and it’s where drivers can find out if their cars are eligible and file a claim if they are.

2. You can’t imply your dealership is affiliated with the settlement.

You may run a Volkswagen dealership, but you are not allowed to suggest — in person, or in your marketing and advertising materials — that your business has any “official” or “authorized” role in the settlement.

3. Owners and lessees have two options.

VW is offering either a car buyback (or early lease termination), plus cash, or they can make a modification to the current vehicle to improve emissions, plus cash. VW anticipates that most people will choose the buyback option.

4. Dealerships are eligible to receive buybacks, too.

If you aren’t a VW or Audi dealership, but you have eligible cars sitting on your lot right now, you might be able to receive a buyback. Go to the website and enter the VINs of all the cars.

5. Only certain VW and Audi cars are eligible.

If you have customers coming in who want to know if their cars are part of the settlement, tell them they need to confirm for sure on, but that in general, these are the 2.0-liter TDI engine vehicles that qualify:

  • VW Beetle 2013-2015
  • VW Beetle Convertible 2013-2015
  • VW Golf 2010-2015
  • VW Golf SportWagen 2015
  • VW Jetta 2009-2015
  • VW Jetta SportWagen 2009-2014
  • VW Passat 2012-2015
  • Audi A3 2010-2013;2015.

The cars must also be operable, which means driven on its own engine power.

6. The FTC negotiated a buyback amount.

The buyback amount is based on a car’s retail value in September 2015, plus extra money to cover time and effort for replacing the car.

7. You can’t offer to “buyback” vehicles.

“Buyback” is a term that has a special meaning related to the VW settlement. Do not offer to “buyback” VW cars from consumers, because you do not have a role in the settlement.

8. Do your due diligence before purchasing a customer’s car.

If someone comes in and wants to trade in their eligible VW or Audi and buy a new one, you can’t just go through with the transaction. You are required to make sure they have visited, they understand how much they could get for their car if they get a buyback settlement, and they still truly prefer just to sell to you. Keep in mind that even if you can check off all those requirements, the FTC may still investigate the authenticity of the transaction.

9. You can market to VW owners who might receive a buyback settlement.

You’re not allowed to claim affiliation with the VW settlement, but you can certainly run advertisements that target individuals who may be receiving settlements. You are also allowed to offer deals to them.

10. Watch out for deceptive ads or individuals contacting your dealership.

Scam artists are targeting dealerships and claiming to be involved in the settlement and offering buybacks. Keep in mind that it is highly unlikely that anyone will contact your dealership — it’s all done through the VW settlement website.

Moving forward, your salespeople shouldn’t be nervous about selling Volkswagen vehicles. Yes, the company did mess up — big time — but they’ve paid a huge price and have taken significant steps to correct their mistakes. Encourage your team to stay up-to-date on Volkswagen news, so they can learn any new nuggets of information that may help give consumers more trust in the brand again.

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Patrick H.
Patrick H.