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A small price to pay?
publication date: Mar 15, 2016
author/source: Captain Pugwash
Corporate arrogance in the automotive industry is not a new thing.
Colourful senior executives with degrees of self-confidence usually associated with show biz divas, can be a breath of fresh air in an otherwise grey corporate environment. With some executives the level of self-confidence is justified and well-earned but with some executives of less stature, both physical and mental, it’s just bluff and bluster.
The arrogance of a leader often filters down to operatives at lower levels in an organisation. It could be argued that this is a cultural thing.
The Germans demonstrate a level of confidence that the French aspire to. The Italians seem to cling to a romantic view of how it used to be and the Japanese are generally humble even if some of their country managers have been less so in the past. Meanwhile US manufacturers still claim to produce world class vehicles even if their experience of the world is largely limited to the North American continent.
The latest example of corporate arrogance was witnessed recently when VW Group UK managing director Paul Willis confirmed that owners of emissions-cheating models in Britain won’t receive compensation like their counterparts in the US. When appearing before the cross-party Environment, Food and Rural Affairs committee Mr Willis refuted claims that the UK’s 1.2 million affected drivers deserved a pay-out because, unlike in the US, “we have an agreement and a solution here”.
It is believed that owners in the US could each receive at least a loyalty bonus of $1,000 from VW. Does this mean that VW Group values the American owners of its vehicles more than the more loyal, and longer standing ones in the UK? And is this just a less than subtle financial ‘encouragement’ in support of VW’s ambition to get a foothold in the American market?
The latest chapter in this saga is the intervention by the UK’s Department of Transport which is reported to have told Volkswagen to address a discrepancy in compensation between Britain and the US of A.
While it may be the department’s responsibility to ensure emissions testing is credible and robust I don’t believe it has the right to try to influence a vehicle manufacturer’s commercial decisions or PR strategies.
The effects of VW Group’s arrogance and intended poor treatment of its substantial loyal owner base here in the UK will only become apparent over the next few years. Paul Willis may well find that a loyalty bonus now, even if only considered by some as a PR exercise, would have been a small price to pay to support its considerable market share here in the future, a share that is already showing signs of ‘softening’.