VW recovers from slump

Consumer research group Roy Morgan has released findings of its brand loyalty survey, conducted face-to-face with current vehicle owners each month and recording their desire to buy a car from the same brand again.

According to Roy Morgan, Volkswagen’s brand loyalty fell significantly after the “Dieselgate” emissions scandal in 2015 that saw the US Environmental Protection Agency bring charges against the German maker for intentionally tricking diesel engine emissions to appear cleaner than they were. The research company says VW’s brand loyalty rating dropped from 66 per cent to 49 per cent directly after the incident.

However, it has regained top position in Australia three years later, out-shining Toyota and Mazda in the top three spots. The German maker is the only European manufacturer to finish in the top six car makers for brand loyalty according to the report.

“Every CEO and marketing director in the world learned a lesson from the controversy that engulfed Volkswagen in 2015,” said Roy Morgan CEO Michele Levine.

“But they can now learn another lesson – how a brand can recover from that kind of slump.”

Survey results for June 2018 show 61.5 per cent of VW owners say they will buy another VW, slightly more than 59.6 per cent of Toyota owners and 57.6 per cent of Mazda drivers. Subaru took fourth spot with 54.4 per cent happy to buy another of the Japanese maker’s cars while Honda (50.9 per cent) and Hyundai (47.7 per cent) rounded out the top six manufacturers.

Despite leading brand loyalty ratings, VW offered one of the market’s shortest warranty periods until it announced it had temporarily increased its coverage from three- to five-years just this month. VW Group managing director Michael Bartsch said that from the 80,000 customers it surveyed annually Volkswagen saw a “strong response” to driveway pricing and finance offers and that it would monitor customer response to the new warranty closely.

Further research conducted by Roy Morgan also showed that private sales of small vehicles will likely lead the market with 20.6 per cent of respondents looking to buy one in the next 12 months. The figure was followed by 16.6 per cent browsing medium SUVs, 7.7 per cent a medium car and 7.1 per cent a small SUV.

The light commercial segment had only 5.6 per cent of private buyers looking to buy again soon, followed by large vehicles (3.6 per cent) and upper-large SUVs (1.9 per cent.)