Diesel Cayenne and VW emission issue
12-18-2015, 01:38 PM
#226
I don't understand why they don't just buy us out, and sell the cars elsewhere. That has to be the least expensive solution and the most straightforward. If you ultimately can't pass emissions tests in any one state, this makes them unviable for the US market. I am sure not everyone will be happy about that remedy, but money talks.
Now as far as a buy back goes, that's not remotely a cheap or easy solution for them so it is only going to ever be considered as a last resort.
Firstly offering the owner anything other than the full purchase price is still going to lead to lawsuits and the avoidance/reduction of lawsuits is their only concern. At full purchase price they will automatically be losing money off the bat since they are not going to be sell it for that (much less for more which would actually be needed to break even).
Now you have to factor in the man power and resources to draft the legal documents (because you will have to sign something saying you waive your right to sue), contacting the customers, and conducting the transaction.
Next up will be the cost to store all the purchased cars while awaiting their final disposition.
Such a buy back will imply an inability to fix the vehicle that resale here in the States would be impossible, so now you have to factor in all the costs in shipping them off to some other country(ies). That would be transportation to ports, prep, loading, shipping, unloading, and more prep.
Of course the other option would be to just scrap them for a total loss.
Of course you also have to look at cars that have been resold separately. The current owner shouldn't be able to make a profit on the deal (e.g. getting original sale value which is presumably over what they paid). What about the original owner and any other owners between the current and original? Finding them all and working out deals that will keep them from suing will not be easy.
Finally a buy back like that would cause such damage to the image that they'd pull all unsold ones too and that would be the end of the TDI. It could also generate some hefty impact to the overall brands too (even more than what has been seen so far).
Logically (it's not going to be a complicated or expensive fix), logistically, and financially the idea of a buy back is just ludicrous if you understand the issue and business in general. There is simply 0% chance of a buy back occurring outside of special cases and high profile owners (and those are not going to get much attention).
They are going to release a fix (software only for the 3.0TDI) and then offer some compensation that will be predicated on you having the fix installed and waiving your right to sue.
12-18-2015, 05:01 PM
#228
Rennlist Member
Of course you also have to look at cars that have been resold separately. The current owner shouldn't be able to make a profit on the deal (e.g. getting original sale value which is presumably over what they paid). What about the original owner and any other owners between the current and original? Finding them all and working out deals that will keep them from suing will not be easy.
Finally a buy back like that would cause such damage to the image that they'd pull all unsold ones too and that would be the end of the TDI. It could also generate some hefty impact to the overall brands too (even more than what has been seen so far).
They are going to release a fix (software only for the 3.0TDI) and then offer some compensation that will be predicated on you having the fix installed and waiving your right to sue.
I disagree with your assessment of the original owners getting screwed, though. Once they're out of the picture with no ownership stake, they have no standing and no grounds to sue VW in any way. I suppose they could sue the person they sold the vehicle to to get a share of any windfall, but really, unless they should show they sold - and at a much less than normal price for a used car - because of the emissions issue, they are simply not Porsche diesel owners any more and don't have a "dog in the fight."
I also disagree with your perception of how a universal buyback would look. I think, at least in the US, that a company doing what's right goes a very long way in keeping a good image. Owning up to the problem and not trying to skirt it once caught is the right approach. Going above and beyond - a universal buyback - just pads that "doing the right thing" image, so while I agree that it would be prohibitively costly, I think it would actually go a very long way in saving diesel engines in the US if the biggest brand(s) stepped up and made it right in a big way.
12-18-2015, 05:11 PM
#229
Rennlist Member
Now as far as a buy back goes, that's not remotely a cheap or easy solution for them so it is only going to ever be considered as a last resort.
I heard the concept of a buyback from a salesman at a major luxury brand in Manhattan. He didn't seem to think it was beyond probable.
Firstly offering the owner anything other than the full purchase price is still going to lead to lawsuits and the avoidance/reduction of lawsuits is their only concern. At full purchase price they will automatically be losing money off the bat since they are not going to be sell it for that (much less for more which would actually be needed to break even).
No one is talking about full purchase price, but even at that number, you are completely disregarding the intangible costs of allowing this to continue. Lower sales, loss of reputation, alienation of customers, etc...Lawsuits are a sure thing if they don't make a strong settlement offer. You also do not know how long it will take to resolve the issue with the EPA.
Now you have to factor in the man power and resources to draft the legal documents (because you will have to sign something saying you waive your right to sue), contacting the customers, and conducting the transaction.
Chickenfeed, are you serious? Bring in temps...
Next up will be the cost to store all the purchased cars while awaiting their final disposition.
Run the distribution process in reverse. Fill the trucks up with diesels at the dealerships and send them back to the prep centers. Put them on the empty ships after they drop off new product. Recondition them for markets elsewhere.I had to sign a "Non-Export" agreement when I bought my Cayenne, so there must be considerable demand for this vehicle elsewhere.
Such a buy back will imply an inability to fix the vehicle that resale here in the States would be impossible, so now you have to factor in all the costs in shipping them off to some other country(ies). That would be transportation to ports, prep, loading, shipping, unloading, and more prep.
Of course the other option would be to just scrap them for a total loss.
Not likely, but who knows.
Of course you also have to look at cars that have been resold separately. The current owner shouldn't be able to make a profit on the deal (e.g. getting original sale value which is presumably over what they paid). What about the original owner and any other owners between the current and original? Finding them all and working out deals that will keep them from suing will not be easy.
Finally a buy back like that would cause such damage to the image that they'd pull all unsold ones too and that would be the end of the TDI. It could also generate some hefty impact to the overall brands too (even more than what has been seen so far).
Sorry, TDI, much to my sadness, died when the scandal broke out.
Logically (it's not going to be a complicated or expensive fix), logistically, and financially the idea of a buy back is just ludicrous if you understand the issue and business in general. There is simply 0% chance of a buy back occurring outside of special cases and high profile owners (and those are not going to get much attention).
You don't know what the fix is going to be or the effect on performance. If the fix were simple or offered an imperceptible performance reduction, the 3.0 would not be affected. The original design team would have nailed it long ago.
Also, please don't make judgments on my understanding the issue or business in general. I hold an engineering degree and MBA, with more years of experience than I'd like to admit and a few impressive turnarounds to my credit. Have you calculated the tangible and intangible costs to VW? Not sure if buybacks would work on the half million 2.0 cars, but they can make us 3.0 owners happy and get a better outcome than a host of angry Porsche/Audi owners.
They are going to release a fix (software only for the 3.0TDI) and then offer some compensation that will be predicated on you having the fix installed and waiving your right to sue.
And the result will be reduced performance.
12-18-2015, 05:20 PM
#230
I would agree that any subsequent owners that sold prior to the fiasco shouldn't have grounds against VW though (again) I don't know if that would stop the lawyers.
My life experience says never underestimate what hoops a lawyer will jump through to line their pockets
Owning up to the problem and not trying to skirt it once caught is the right approach.
12-18-2015, 05:26 PM
#231
Rennlist Member
EC- My intention is to keep the CD for a long time. I am very happy with it. Best long distance vehicle I have ever owned. If you want a story about buyers remorse, I will chew your ear off on my year old Mercedes. I've owned 30+ cars, and I am not one of those heroes who drive them until the wheels fall off. But who here wouldn't use the chance of a buyback to step up to a better Porsche?
12-18-2015, 05:33 PM
#232
Moderator !x4
Dear M
As promised in my last letter to you, we remain committed to keeping you updated on the status of the Environmental Protection Agency Notice of Violation we received affecting your Porsche Cayenne Diesel vehicle.
Both we and our engine supplier continue cooperating with all regulatory authorities to identify the changes that will be required in order to re-certify the 3.0-liter V6 diesel engine. Therefore, we would only be speculating if we tried to comment about how any such changes might affect the performance of your Porsche Cayenne Diesel vehicle, if at all. We can only hope you will accept our assurance that, as soon as we know, we will inform you.
As a sign of our respect for you as a Porsche customer, and our appreciation for your patience and loyalty while we clarify the issues and gather all the facts, we hope you will accept a 2-year Porsche Approved Limited Warranty that will extend the warranty coverage for your Cayenne Diesel up to 6 years or 100,000 miles from its original in-service date, whichever occurs first. Your Porsche Cayenne Diesel remains safe and roadworthy, and we hope this longer limited warranty coverage will allow you to continue to drive your Porsche with great confidence. You can find all the details about the Porsche Approved Limited Warranty at
http://www.porsche.com/usa/approvedu...ures/warranty/.
This warranty will automatically be added to the records concerning your Porsche Cayenne Diesel vehicle without any further action needed on your part, and is also fully transferable to any future owner of your car. You may be assured that we are offering this without any prejudice to any future rights you may have or may wish to exercise as a result of these unfortunate matters. We mean only to thank you for your loyalty to Porsche and to recognize that these investigations have caused you concern, for which we apologize.
Please allow me to reiterate that we appreciate your business and your loyalty. As this situation unfolds, we hope we may ask you to allow us the necessary time to ensure we make this right for you. We are committed to doing just that.
Very truly yours,
Klaus Zellmer
President and Chief Executive Officer
Porsche Cars North America, Inc.
As promised in my last letter to you, we remain committed to keeping you updated on the status of the Environmental Protection Agency Notice of Violation we received affecting your Porsche Cayenne Diesel vehicle.
Both we and our engine supplier continue cooperating with all regulatory authorities to identify the changes that will be required in order to re-certify the 3.0-liter V6 diesel engine. Therefore, we would only be speculating if we tried to comment about how any such changes might affect the performance of your Porsche Cayenne Diesel vehicle, if at all. We can only hope you will accept our assurance that, as soon as we know, we will inform you.
As a sign of our respect for you as a Porsche customer, and our appreciation for your patience and loyalty while we clarify the issues and gather all the facts, we hope you will accept a 2-year Porsche Approved Limited Warranty that will extend the warranty coverage for your Cayenne Diesel up to 6 years or 100,000 miles from its original in-service date, whichever occurs first. Your Porsche Cayenne Diesel remains safe and roadworthy, and we hope this longer limited warranty coverage will allow you to continue to drive your Porsche with great confidence. You can find all the details about the Porsche Approved Limited Warranty at
http://www.porsche.com/usa/approvedu...ures/warranty/.
This warranty will automatically be added to the records concerning your Porsche Cayenne Diesel vehicle without any further action needed on your part, and is also fully transferable to any future owner of your car. You may be assured that we are offering this without any prejudice to any future rights you may have or may wish to exercise as a result of these unfortunate matters. We mean only to thank you for your loyalty to Porsche and to recognize that these investigations have caused you concern, for which we apologize.
Please allow me to reiterate that we appreciate your business and your loyalty. As this situation unfolds, we hope we may ask you to allow us the necessary time to ensure we make this right for you. We are committed to doing just that.
Very truly yours,
Klaus Zellmer
President and Chief Executive Officer
Porsche Cars North America, Inc.
12-18-2015, 05:48 PM
#233
His thought process is more likely "get him to believe PCNA is going to buy his car back so he'll start looking hard at a new one, then by the time he finds out there is no buy back he'll already be in love with the idea of a new car and buy it anyway".
Wether such a tactic would work on you or not is beside the point. The point is that such a scenario is more likely, I think, than him having any real clue about what is and isn't probable from PCNA.
Now if that was coming from a Sr exec or attorney at PCNA, that would obviously carry more weight.
No one is talking about full purchase price
you are completely disregarding the intangible costs of allowing this to continue.
Chickenfeed, are you serious? Bring in temps...
Run the distribution process in reverse. Fill the trucks up with diesels at the dealerships and send them back to the prep centers. Put them on the empty ships after they drop off new product. Recondition them for markets elsewhere.
Sorry, TDI, much to my sadness, died when the scandal broke out.
You don't know what the fix is going to be or the effect on performance.
I could be wrong, I fully admit that. I think, however, I have less chance of being wrong than the theories I've heard about significant MPG/HP/TQ impacts.
Also, please don't make judgments on my understanding the issue or business in general.
Have you calculated the tangible and intangible costs to VW?
When you talk about the intangibles, I think you are not properly accounting for what public opinion/belief of a buy back would be (e.g. it may shift the focus, but it's not going to significantly alter the general perception).
Not sure if buybacks would work on the half million 2.0 cars, but they can make us 3.0 owners happy and get a better outcome than a host of angry Porsche/Audi owners.
And the result will be reduced performance.
On the Urea cars, that's far from certain and actually looking unlikely.
12-18-2015, 06:25 PM
#235
Rennlist Member
And salesmen never lie or speak to things they have little/no understanding of
His thought process is more likely "get him to believe PCNA is going to buy his car back so he'll start looking hard at a new one, then by the time he finds out there is no buy back he'll already be in love with the idea of a new car and buy it anyway".
Wether such a tactic would work on you or not is beside the point. The point is that such a scenario is more likely, I think, than him having any real clue about what is and isn't probable from PCNA.
Now if that was coming from a Sr exec or attorney at PCNA, that would obviously carry more weight.
Just thought the idea was interesting. he heard if from someone in VW and volunteered the info after the "what do you drive" question. If anything, it has me on hold for anything new.
You can't talk about anything else. If they tried to buy back at anything less then they would still face lawsuits which is the sole purpose of such a move.
Don't they make reasonable wear and tear allowances for Lemon Law vehicles?
No I'm not. The cost associated would be on top of the damage already done. As I already express, the implications of a buy back are going to hurt both the model (TDIs) and the overall brand, so you are still going to see continued impacts to the sales even with a buy back. Because or the impact to the reputation, I argue that there would be no new sales of the TDI so really it's little different than the current situation except with all the added costs and time of the buy back.
But we could be talked into other new Porsches.
For some things you, others (where the real money will be spent) you can't. You also have to factor that across all dealers so it's not like you're just hiring 10 people for 6 months or something.
Ya think? That still costs lots of money and time to organize and execute.
They can handle it...
Then I can't help other than try to help you not hang your hopes on PCNA buying back your car.
That is not my hope, but I will not accept reduced performance.
I have done enough research over the years of diesel cars to make an educated guess that the fix for Urea based cars is more than likely just going to be a software fix. Furthermore the most likely scenario is just that it will increase your Urea usage.
I could be wrong, I fully admit that. I think, however, I have less chance of being wrong than the theories I've heard about significant MPG/HP/TQ impacts.
I make assumptions purely based on the things you write. Putting weight in the word of a salesman and believing a buy back of all TDI cars is anything but the last case option does not help your cause.
Gnat- I am only exploring the concept while the "fix" is in development. Yes, may be last case. May be the best case for them to wipe the slate clean. Again, you are ignoring the endless EPA runaround, long legal battles and unknowable effect on reputation.
Of course not because, like you, I don't have access to their financial information. I can make reasonable assumptions, however, about how a buy back would look.
When you talk about the intangibles, I think you are not properly accounting for what public opinion/belief of a buy back would be (e.g. it may shift the focus, but it's not going to significantly alter the general perception).
It would improve my perception. "We sold you a non-compliant car, it won't perform to your expectations, we will take it back."
No way can they get away with buying back just some models. That would make things many times worse for them.
Agree here. But we are talking about less than 600,000 cars. All usable in other countries.
On the non-Urea cars, absolutely.
On the Urea cars, that's far from certain and actually looking unlikely.
His thought process is more likely "get him to believe PCNA is going to buy his car back so he'll start looking hard at a new one, then by the time he finds out there is no buy back he'll already be in love with the idea of a new car and buy it anyway".
Wether such a tactic would work on you or not is beside the point. The point is that such a scenario is more likely, I think, than him having any real clue about what is and isn't probable from PCNA.
Now if that was coming from a Sr exec or attorney at PCNA, that would obviously carry more weight.
Just thought the idea was interesting. he heard if from someone in VW and volunteered the info after the "what do you drive" question. If anything, it has me on hold for anything new.
You can't talk about anything else. If they tried to buy back at anything less then they would still face lawsuits which is the sole purpose of such a move.
Don't they make reasonable wear and tear allowances for Lemon Law vehicles?
No I'm not. The cost associated would be on top of the damage already done. As I already express, the implications of a buy back are going to hurt both the model (TDIs) and the overall brand, so you are still going to see continued impacts to the sales even with a buy back. Because or the impact to the reputation, I argue that there would be no new sales of the TDI so really it's little different than the current situation except with all the added costs and time of the buy back.
But we could be talked into other new Porsches.
For some things you, others (where the real money will be spent) you can't. You also have to factor that across all dealers so it's not like you're just hiring 10 people for 6 months or something.
Ya think? That still costs lots of money and time to organize and execute.
They can handle it...
Then I can't help other than try to help you not hang your hopes on PCNA buying back your car.
That is not my hope, but I will not accept reduced performance.
I have done enough research over the years of diesel cars to make an educated guess that the fix for Urea based cars is more than likely just going to be a software fix. Furthermore the most likely scenario is just that it will increase your Urea usage.
I could be wrong, I fully admit that. I think, however, I have less chance of being wrong than the theories I've heard about significant MPG/HP/TQ impacts.
I make assumptions purely based on the things you write. Putting weight in the word of a salesman and believing a buy back of all TDI cars is anything but the last case option does not help your cause.
Gnat- I am only exploring the concept while the "fix" is in development. Yes, may be last case. May be the best case for them to wipe the slate clean. Again, you are ignoring the endless EPA runaround, long legal battles and unknowable effect on reputation.
Of course not because, like you, I don't have access to their financial information. I can make reasonable assumptions, however, about how a buy back would look.
When you talk about the intangibles, I think you are not properly accounting for what public opinion/belief of a buy back would be (e.g. it may shift the focus, but it's not going to significantly alter the general perception).
It would improve my perception. "We sold you a non-compliant car, it won't perform to your expectations, we will take it back."
No way can they get away with buying back just some models. That would make things many times worse for them.
Agree here. But we are talking about less than 600,000 cars. All usable in other countries.
On the non-Urea cars, absolutely.
On the Urea cars, that's far from certain and actually looking unlikely.
12-18-2015, 06:47 PM
#236
Rennlist Member
I also just received the email. I think it's a welcome first step from PCAG and PCNA. Certainly better than the gift certificate / $500 cash card offer for 4-cylinder owners.
12-18-2015, 08:02 PM
#237
Moderator !x4
12-18-2015, 08:02 PM
#238
Rennlist Member
As JRoach said, lets see what is going to happen next. So basically the extended warranty is similar to CPOing our cars. Maybe it is a $1,500 gesture?
As for other remedies, I guess it depends on how much the CD changes due to new emission control software. I think there is going to be a degrading of performance and fuel consumption. If so, there is a way to measure of economic loss to an owner. But it is all speculation for the time being.
I would say that if POA wants to look good in a PR way, maybe start a favorable trade-in program (like I posted eons of messages ago) for an owner who wants to buy a vehicle from a brand owned by parent VW. For example, set a depreciation chart that is more generous than the historical figures for other Cayenne models (I guess the only one that can be compared would be the base V6 one). Just a thought.
As for other remedies, I guess it depends on how much the CD changes due to new emission control software. I think there is going to be a degrading of performance and fuel consumption. If so, there is a way to measure of economic loss to an owner. But it is all speculation for the time being.
I would say that if POA wants to look good in a PR way, maybe start a favorable trade-in program (like I posted eons of messages ago) for an owner who wants to buy a vehicle from a brand owned by parent VW. For example, set a depreciation chart that is more generous than the historical figures for other Cayenne models (I guess the only one that can be compared would be the base V6 one). Just a thought.
12-18-2015, 09:23 PM
#239
Got my email too as I was responding to PJ the last time
I haven't read the details yet. Is it bumper to bumper like the CPO or is it just emissions related stuff?
Of course the first thing they'll do is flash your ECU, so if you decide you don't want the "upgrade" then this isn't worth much
It will all come down to what the fix is.
I actually don't want this. I was looking forward to the warranty expiring next year as I'd then be able to tinker and modify with ugly looks from my wife 
I haven't read the details yet. Is it bumper to bumper like the CPO or is it just emissions related stuff?
Of course the first thing they'll do is flash your ECU, so if you decide you don't want the "upgrade" then this isn't worth much
It will all come down to what the fix is.
I actually don't want this. I was looking forward to the warranty expiring next year as I'd then be able to tinker and modify with ugly looks from my wife
12-18-2015, 09:27 PM
#240
Rennlist Member
Got my email too as I was responding to PJ the last time
I haven't read the details yet. Is it bumper to bumper like the CPO or is it just emissions related stuff?
Of course the first thing they'll do is flash your ECU, so if you decide you don't want the "upgrade" then this isn't worth much
It will all come down to what the fix is.
I actually don't want this. I was looking forward to the warranty expiring next year as I'd then be able to tinker and modify with ugly looks from my wife
I haven't read the details yet. Is it bumper to bumper like the CPO or is it just emissions related stuff?
Of course the first thing they'll do is flash your ECU, so if you decide you don't want the "upgrade" then this isn't worth much
It will all come down to what the fix is.
I actually don't want this. I was looking forward to the warranty expiring next year as I'd then be able to tinker and modify with ugly looks from my wife
There is so much power sitting on the table.