Volkswagen Dieselgate update: Sales stumble in Germany, and who's buying all those VW dealerships?

April 19, 2016

Germans have a reputation for being on-time, and this week, Volkswagen will have a chance to prove (or disprove) that stereotype in a very big way. A federal judge has given the automaker until Thursday to submit plans for fixing 482,000 Audi and VW 2.0-liter diesels equipped with defeat devices capable of cheating on U.S. emissions tests.

Last we heard, at least one person at the Environmental Protection Agency thought that the automaker might flub the deadline, but maybe the company is just trying to build suspense. You know, for the forthcoming novel, movie, and documentary about Dieselgate?

In the meantime, other news related to Volkswagen's ongoing diesel scandal continues to accumulate in our inboxes. Here are a few of the more notable stories:

Volkswagen sales stumble in Germany: Since news of Volkswagen's diesel-cheating broke last September, consumers' faith in in the company has been shaken. The VW brand has been hit especially hard--perhaps because it shares a name with its parent--but in Germany, shoppers had remained stubbornly loyal.

Not anymore: VW sales in Germany have fallen 8.2 percent, contributing to the brand's worldwide dip of 2.7 percent. (On the upside, sales in China were up 3.9 percent and in Eastern Europe, 9.0 percent.)

Woebcken takes the reins in America:  Last month, Michael Horn suddenly left his post as CEO of the Volkswagen Group of America. That was especially bad news to VW dealers, who found Horn to be a great communicator and a bridge to the company's top brass in Germany (even though, by all accounts, those in Germany weren't interested in chatting so much). Hinrich Woebcken stepped in to fill Horn's shoes while a suitable replacement was found, and in fact, that replacement is Woebcken himself. In addition to managing the Volkswagen Group of America, he'll oversee the VW brand here, too.

Betting on Volkswagen dealerships: The only stock advice we've ever given anyone has been, "Buy low, sell high". Clay Cooley and Jason Kuhn must've overheard us, because they're in the process of buying and building a host of VW dealerships. (Because really, how much lower could things go?) Cooley has already bought two VW dealerships since Dieselgate erupted, and Kuhn, who already owned two, bought another and plans to build a fourth shortly. Are they crazy, or crazy like foxes? That depends on whether Volkswagen invests the time and energy necessary to win back the hearts and minds of Americans, or whether it pulls out of America altogether (which is an option, apparently).

Volkswagen accused of patent infringement: Paice LLC has a big beef with Volkswagen. The Baltimore-based company says that Audi, Porsche, and VW are using its proprietary hybrid technology without paying the proper licensing fees, and it has filed a patent-infringement complaint with the International Trade Commission to set things right.

Depending on how the ITC rules, Volkswagen brands could be prohibited from selling and importing vehicles that use Paice's technology. That would compound the troubles Volkswagen is facing on the diesel front, since Dieselgate has forced the automaker to stop selling Audi, Porsche, and VW "clean diesel" vehicles since last fall.

Note: For purposes of clarity, "Volkswagen" has been used to refer to the Volkswagen Group parent company, while "VW" has been used to refer to the company's popular mass-market brand of automobiles.

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