VW Dealers Are Freaking Out Over The Scout Announcement

Electric Vehicles / 15 Comments

The NADA is gravely concerned that the Scout move is the beginning of the end.

Volkswagen is moving quickly towards an all-electric future. To help it gain ground in the US, the German automaker is reintroducing an iconic name from the not-so-distant past. Earlier this month, VW announced that it would revive the Scout name for a line of new EVs, but the company's dealer network sees nothing but red flags in the decision and believes that the dealer model may be changing, and not in their favor. The National Automobile Dealers Association (NADA) recently wrote a letter to VW, explaining its position.

When VW Group CEO Herbert Diess announced the move, he said that Scout would be independent of Volkswagen, but he did not explain how the vehicles would be sold. That didn't sit right with dealers, who have become concerned that the automaker will sell Scouts direct to consumers.

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Volkswagen

Diess has long been an advocate for the franchised dealer model, and the NADA letter calls that out, but the Association still has concerns about the process. The Scout move sets up an entirely different type of vehicle for VW, whose most "rugged" vehicle in the US is currently the Atlas.

In the letter, NADA CEO Mike Stanton added that "the longer your dealers go without information and answers to their questions, the more that speculation will fill the void." That's the opinion at the national level, but state-level dealer associations have a more cynical outlook.

North Carolina Automobile Dealers Association president Robert Glaser wrote his own letter to Volkswagen and had some choice words for the automaker.

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"Certainly, given the strong history of a supportive and effective VW dealer network, even during the diesel-gate fiasco, the clear expectation would be that VW dealers would be given the first opportunity to enlist as a Scout dealer," he wrote. Glaser went on, saying, "the widespread belief is that the underlying reason VW is planning to create a parallel dealer network is VW's intention to reduce the VW dealer count." That's not an off-the-wall concern, as Mercedes wants to slash its dealer counts.

Beyond missing out on new vehicle sales, which is one of the primary ways a dealer makes money, several of VW's dealer partners have made "made significant investments to support VW's business model and transformation to electrification. So far, the automaker has rolled out its ID.4 EV and has announced the ID. Buzz electric van in the United States. Scout is set to launch in 2026.

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Source Credits: Automotive News

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