Volkswagen Waging War On Quality Image

By Bill Visnic September 8, 2011

VW 2011 Quality.jpg

Most discussions about the Volkswagen Group inevitably turn to its goal of becoming the world’s largest automaker by 2018. But in reality, the issue for VW is as much one of quality as quantity. Sure, the company wants to be the world’s No. 1 automaker – but U.S. executives at a recent new-product introduction at Volkswagen of America Inc. headquarters in Herndon, VA, said they’re first engaging in an all-out assault on the perception that the brand is synonymous with poor quality.

Volkswagen’s U.S. operations are charged with contributing a projected 800,000 sales annually towards the company’s 2018 target of 10 million annual sales globally. That’s in excess of three times VW’s current annual sales rates in America (2010 U.S. sales totaled 256,830) and requires an annual sales increase of about 15 percent between now and 2018. Company managers know those kinds of numbers won’t happen unless the brand’s rep for poor quality – and high maintenance costs – is turned around.

Volkswagen ranked 28th out of 32 brands in the most recent J.D. Power and Associates Initial Quality Study (IQS), the metric regarded as the most consistent yardstick of individual brands’ relative quality. The VW brand has long been well below the industry average in the IQS ranking and executives here know that performance has to be improved. The company recently created the new post of executive vice president of quality, and pirated Audi of America Inc. quality boss Marc Trahan for the position. Trahan, a quiet and low-key executive who is highly regarded throughout the VW Group empire, combines his internal regard with a deep technical knowledge that should serve well in shepherding quality issues to proper and prompt resolution.

VW Warranty Cost Trend.jpgWork To Do
“In (J.D. Power’s) IQS, we have some issues there,” Trahan admits. “I think it’s real, I think it’s valuable,” he adds in response to critics of the Power metrics for IQS. But he pointed to other measures that, he believes, show Volkswagen is making progress in the quality war. One, he said, is J.D. Power’s APEAL (Automotive Performance, Execution And Layout) study, where VW has had several recent winners. Trahan said APEAL can be a more incisive look at customers’ overall perception of quality, rather than IQS, which can be skewed by sometimes minor foibles. The APEAL metrics are a better measure of overall quality, he said.

But Trahan also said VW has instituted a system of almost constant monitoring of “voice of customer” feedback to ensure the company has its finger on the pulse of current customer grievances and concerns. This feedback can go to marketing, factory and even design executives for analysis – and finally, if deemed necessary, to the VW management board itself for resolution. He said the process already has yielded quick-fix results for problems such as the user interface for its onboard Bluetooth systems, a redesign for the poorly engineered seatback-recliner adjustment for the Jetta that was called out by media and customers, and improved climate-control markings and indicators for the Tiguan compact crossover. Volkswagen’s U.S. operations are transmitting more quality and voice-of-customer input to company headquarters in Germany than any other market, he said.

And there have been improvements in certain other measures of “quality,” Trahan said. There has been a systemic reduction in annual warranty costs since 2005, and he claimed the reduced warranty spending is a valid indicator of improved quality across the board. Including a projected 10 percent year-over-year reduction projected for 2011, there has been an aggregate reduction in warranty costs of more than 50 percent since 2005, according to VW’s figures. And Trahan also showed results of a J.D. Power metric measuring the number of visits to service departments that require actual repairs. Here, the brand ranks near the top, with 31 percent of visits requiring repair, the leaders mostly being Japanese brands. He said visits to dealership service departments that don’t require repairs also can be an indicator that some brands’ perceived “quality” problems might be less severe than others.

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vw4sales says: 7:37 AM, 09.09.11

I believe VW has responded to what the critics have put out there in the last 10 years and now they have Americanized some of there product. i.e. 2011 Jetta 2012 Passat...If you have not seen or driven one check out the CC what a great car for the money even the Sport is loaded with Bluetooth, power seats, V-Tex, 6spd or Dsg. Great quality and if this is the future of VW I say "Great" If Americans want a car to compete with Honda and Toyota in price they have one and they seem to be slightly less boring then the competition. If you want a premium Import for Less then the top premium brands we have cars for that to. Good Job VW and keep working on it!!!

hydiesel says: 10:33 AM, 09.09.11

VW will have to do more than talk about quaiity control. Just Google customer complaints and see what people are saying. When the timing belt go's and blows the entire engine, after warranty, you are talking a few thousand dollars expense. I was planing on getting a Sport Wagen TDI. Now I will never look at VW again.

hydiesel says: 10:34 AM, 09.09.11

VW will have to do more than talk about quaiity control. Just Google customer complaints and see what people are saying. When the timing belt go's and blows the entire engine, after warranty, you are talking a few thousand dollars expense. I was planing on getting a Sport Wagen TDI. Now I will never look at VW again.

hydiesel says: 10:34 AM, 09.09.11

VW will have to do more than talk about quaiity control. Just Google customer complaints and see what people are saying. When the timing belt go's and blows the entire engine, after warranty, you are talking a few thousand dollars expense. I was planing on getting a Sport Wagen TDI. Now I will never look at VW again.

hydiesel says: 10:39 AM, 09.09.11

Sorry about the three post. Getting old and brain not kicking in sometimes.

blackdynamite1 says: 1:43 PM, 09.09.11

It will take SEVERAL years of top score in top surveys, like the highly-regarded IQS, for VW to be taken seriously as a mainstream builder of daily drivers. Hyundai is still fighting that perception battle, but with more recent success.

Rebuilding an image can take 5 years, 10 years, or more! And the competition isn't standing still. VW may be improving, but so is the competition.

Considering the Camry, Fusion, Accord, Altima, and Malibu are all being redesigned in the next 12 months, if the Passat gets 100k next year in sales, that would be a major accomplishment. 150k, they should erect a monument!

Passat's name is MUD on the street. And that won't change anytime soon.
BD

fowvay says: 6:03 PM, 09.26.11

I currently drive a 2009 TDI Jetta. My previous car was a 1999.5 Golf TDI. Over the past 12 years I've grown to absolutely HATE my local VW dealership.

They're incompetent, rude, and arrogant. They're dishonest too. My 2009 model came with free 36,000 mile maintenance but my local dealership wasn't even aware of the proper oil my common-rail TDI engine required. A simple brake fluid flush was extended out past the 3 year interval simply so that VW could save the money on this required maintenance item. I refuse to stand at a car dealership and argue with the service writer or service manager over what is published in my owners manual and undershood decals stating service specifics. I am truly convinced that many of these personnel are incapable of reading or understanding the written language on any sort of proficient level.

If VW ever hits their 800,000 vehicle goal they will do it without my contribution. This 2009 model is the last of this brand to cast a shadow on my driveway. I've had enough of the lack of customer service and the incompetence and rudeness of VW and their dealer network to last me a lifetime.

From failing MAF sensors and clogged intake manifolds on my A4 Golf to failing high-pressure fuel pumps and improperly PDI'd A5's, VW has a long way to go before anyone is going to believe they've addressed their poor quality and customer service. One call to VW's corporate assistance line will prove my point. Funny how the people that I have spoken to at their contact numbers don't even own VW cars. Maybe they know something that the rest of us should take a note from.

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