VW dealers feel charged up

VW dealers feel charged up

January 21st, 2010 by Mike Pare in Volkswagen

Staff photo by Angela Lewis/Chattanooga Times Free Press Coby Martin details a Jetta at Village Volkswagen on Wednesday.

Staff photo by Angela Lewis/Chattanooga Times Free Press...

HERNDON, Va. -- Volkswagen dealers who didn't believe the automaker had much of a future in the United States have changed their minds after seeing the company's growth plans, an official says.

The aim of VW has been to "reawaken them from a winter sleep," said Stefan Jacoby, Volkswagen Group of America's president. "We believe we are preparing them for the future."

Mr. Jacoby said dealers who were little motivated and skeptical about the automaker's U.S. outlook in the past are seeing things differently.

"Dealer satisfaction is the highest in 10 years," Mr. Jacoby said earlier this month to journalists at VW's American headquarters outside Washington, D.C.

Mr. Jacoby said 66 of VW's 580 dealers nationally are investing in new facilities.

Volkswagen, with its new Chattanooga plant helping lead the way, plans to double U.S. sales in two to three years to up to 450,000 vehicles. By 2018, the auto company wants to sell 1 million VWs and Audis in the U.S.

Brad Cobb, a partner in Village Volkswagen in Chattanooga, said if the auto market returns from its slowdown, he believes VW can reach its sales goals.

"With the U.S. plant and products and the momentum of a new advertising firm, they're definitely ramping up to hit those numbers," he said.

Mr. Cobb said the majority of the automaker's dealers are ready to sell more VWs. Village Volkswagen recently upgraded its sales space, and Mr. Cobb said it has always valued customer service.

Jim Medlen, manager of Al Johnson Volkswagen in Dalton, Ga., said he'd like to double sales in the next two or three years.

"Volkswagen is coming out with real strong programs and incentives and making good new product," said Mr. Medlen, adding that dealer-principal Al Johnson has been in business for 41 years and "customer satisfaction is the No. 1 goal."


Among keys for VW growth from a dealer standpoint:

* Focus on the customer experience

* Enhanced investment in facilities

* Encourage customer loyalty

Source: Volkswagen


* More than 80 percent of VW's 580 dealers in U.S. are profitable.

* Exclusive dealers account for 75 percent of VW's sales volume.

* Surveys suggest that car buyers are more likely to consider buying a VW than they were a year ago.

* Certified preowned sales increased more than 20 percent in 2009.

Source: Volkswagen

Among keys to preparing for growth from a dealer standpoint are to focus on the customer experience, enhanced investment and customer loyalty, Mr. Jacoby said.

He cited the recent plan to put a Volkswagen and Audi dealership in New York. Volkswagen has signed a $125 million deal for a 265,000-square-foot building in the high traffic area of 11th Avenue in Manhattan.

The VW store is expected to open this spring and the Audi store in late 2011. Both will have new showroom concepts.

In addition, the auto company will have central city presences in Atlanta and San Francisco, Mr. Jacoby said.

Chattanooga is expected to co-host Volkswagen's U.S. dealer network in 2010 as the group brings its national convention to Tennessee.

The Chattanooga plant, expected to start production in 2011, is to produce 150,000 midsize sedans a year.

Mr. Jacoby said the plant will "establish VW as a true volume producer" and help it sell to a broader public.