But VW USA does not have a solution to present to greedy dealers yet.
In a report from Automotive News, Volkswagen North America's boss has proclaimed that the automaker needs to find a way to avoid markups on its new-for-America Volkswagen ID. Buzz. Speaking at a media roundtable in Huntington Beach, California, CEO Pablo Di Si said that he and his team are having discussions with dealers in preparation for the local launch of the recently revealed electric van, figuring out how to handle orders if customer demand proves huge – which it is expected to – and how to keep these dealers happy without squeezing customers for all they've got.
Di Si said he wants dealers to make money, “but we cannot penalize the consumers.” However, VW does not yet know how to prevent these so-called market adjustments.
“We need to find a fair way for the consumer and the dealer,” said Di Si. “[We need to ensure] there's no overpricing, that the system doesn't crash. We have, I would say, another three to five months to figure it out. We don't have the solution yet.”
Ridiculous markups have become all too common in recent times, but automakers have had enough. Recent studies have shown that these price gouging practices discourage customers from building loyalty, not only with a particular dealership but with the brand as a whole. Ford has warned dealers against these markups, and from next year, all Blue Oval EVs will be sold with no-haggle pricing.
For the ID. Buzz, a similar course of action seems prudent. This is a car engineered, styled, and sold with an air of cheerfulness, with a nod to simpler times, and with a focus on sustainability. Excessive markups would detract from all of those goals, and for a company that calls itself the People's Car, keeping customers happy is very important.
Di Si also ruled out the possibility of a higher-priced limited-run launch edition, as this would go against all that a cheap and cheerful car for the masses is all about. “I don't think people should pay more,” said the CEO.
Volkswagen needs this car to be a success if it is to challenge the likes of Tesla and fend off up-and-coming EV manufacturers.
“We cannot make a mistake [with] this vehicle,” continued Di Si, reiterating that the Volkswagen North America “cannot have markups.”
Barring dealers from setting their own pricing may not sit well at first, but it's a good call that will bring customers back and attract new ones. America's ID. Buzz has the space, battery capacity, performance, style, and image that so many buyers are seeking. Volkswagen just needs to figure out pricing, and it could have a smash hit on its hands. But if dealers are allowed to upcharge at will, this brilliant piece of design and engineering could become a flop.
Choose wisely, VW.
Keyword: VW Boss Says ID. Buzz Can't Afford Dealer Markups