VW America CEO promises no markups on ID. Buzz
The US version of the VW ID. Buzz has just been officially unveiled and the car is attracting all sorts of attention. On one hand, the first reviews find the car as close to perfection as it gets, on the other hand, future US customers are worrying already about the car going on sale. They don’t worry about when it’ll be available but about how much will the dealers mark up the prices.
Dealer markup in the US is part of the reality, that’s how it’s always been - since forever. But the advent of electric cars brought up the ugly side of it, with unprecedented strength. The best example would be dealers demanding $150,000 for Ford F-150 Lightning, some asking more than $200,000 for the GMC Hummer EV. The dealers argue it's a free market and demand dictates the prices, customers simply call it what it is - greed and profiteering.
With the VW. Buzz creating a huge interest among potential customers, car dealers were probably rubbing their hands already, hoping for bumper profits and easy money. So much so, that the CEO of VW America had to step in. Pablo Di Si feels quite strongly about the whole situation and went on to say:
"We cannot make a mistake [with] this vehicle. With respect to the customer ... let's discuss it. We have a good relationship with the [dealer] network. We cannot have markups."
VW is not the first company that will try to put brakes on the dealers, Ford already announced that from next year “no-haggle” policy comes into play - for electric cars to start off, for the rest of the vehicles at a later stage. Selling cars online is seen by many manufacturers who have been watching Tesla’s business model for the last few days.
VW still has a few months left before it needs to come up with a solid solution. The first units of the long-wheelbase VW ID. Buzz are scheduled to arrive in the US towards the end of this year. The company is going as far as not offering a limited launch edition to ensure the prices stay fair.
VW ID. Buzz is expected to cost well over $60,000 when it eventually arrives. The vehicle does not qualify for the $7,500 EV tax since it’s made outside of the US. The only possibility to get the EV tax credit would be taking the vehicle on lease from an established US financial institution - VW hasn’t released any information about its plans yet.
If the US dealers were left free reins, we would see prices of VW ID. Buzz skyrocketing and easily passing the $100,000 mark. Many customers would pay simply because they want to get hold of an iconic car. For years the new ID. Buzz could have stayed out of reach for many, even used examples could cost more than the MSRP of a new vehicle. They probably will anyway, regardless of the actions taken by Volkswagen.
"With respect to the customer" In US dealerships? It is lovely they noticed NOW, it is an issue. I am so glad this trend did not transfer overseas, at least not for now.
- 06 Jun 2023