Volkswagen Agrees to $1.2 Billion Compensation for U.S. Dealers

            Volkswagen agreed to pay 1.2 billion dollars to its entire U.S. dealer customers due to the 2015 emission scandal they went through. They will pay every dealership an average of $1.85 million as a settlement of last year case. Moreover, they agreed to pay $15 billion in a separate settlement with federal regulators and consumers. The franchised dealers have been in trouble selling their inventory. Many models were not sold since the emissions scandal emerged. Its dealership value declined as well as its reputation.

            However, do you think that the $1.85 million are enough to fulfill dealerships losses? It is a considerable amount, but it does not covers all of it. This quantity is not even what an average dealership sells in a month. According to Edmund.com, every car dealership sells an average of 945 cars per year. This means that they sell a mean of $2.3 million per month. In addition, they do not only loss money, the company's reputation declined. As a consequence, consumer's behavior was influenced. People decided to look for other alternatives. Moreover, their marketing concept was not well applied. They did not make their maximum effort to satisfy their customers. Their product lacked of social responsibility and marketing ethics.

            As a car lover, it was very disappointing to listen about the Volkswagen illegal actions. This brand had an enormous global recognition for its good quality products. It is good the effort they are doing by compensating car dealerships, but not enough repair the damages. This is relevant to other business such as its competitors and the auto parts industry. They would not be able sell many products because of the lack of sales of these vehicles. However, factories will need to cancel the production of this parts.

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