California dealers demand Scout / VW stop direct-to-consumer sales with cease and desist letter

[Jrgunn5150]

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Don't know why / how Tesla is exempt from the law.

Spend tens of billions buying the government, you get all types of exemptions.

They really don't even hide it much anymore.

 

[theek]

Are they not aware that VW (the brand) may pull out of the US entirely due to low sales volumes?

 

[joewilk45]

2 years away go mow the lawn or shovel the snow 2027 is when we can put the cookies and milk out for Scout

 

[Chuckles]

Are they not aware that VW (the brand) may pull out of the US entirely due to low sales volumes?

VW sales are fine.

• Volkswagen sales increased 15.2% YoY compared to 2023, to 379,178, units
• Q4 sales improved by 7% compared to Q4 of 2023
• Jetta and Tiguan sales supported the brand’s YoY growth by increasing 51.5% and 23.8% YoY respectively
• Atlas sales grew by 24.1% YoY and Atlas Cross Sport by 11.6% YoY

Reston, VA — Today, Volkswagen of America released sales figures for Q4 2024 and for the year overall.

 

[blmtnc]

This data is a snapshot in time. Historically compared with other auto makers in the US they've captured smaller than desired market share, and have openly discussed in the past their viability in the US. Until they de-contented and moved to platforms more adapted to the Chinese market vs. EU, it was considered a coastal niche brand, and arguably still is. I've owned several new VWs in the past, and when they made that switch (combined with Dieselgate) is when I checked out. I totally get to improve volume they had to make the vehicles more market specific, but as a consumer I'm more interested in the cars spec'd as they are on the other side of the pond. So they effectively went down-market to remain in this market.

 

[JungGravy]

This data is a snapshot in time. Historically compared with other auto makers in the US they've captured smaller than desired market share, and have openly discussed in the past their viability in the US. Until they de-contented and moved to platforms more adapted to the Chinese market vs. EU, it was considered a coastal niche brand, and arguably still is. I've owned several new VWs in the past, and when they made that switch (combined with Dieselgate) is when I checked out. I totally get to improve volume they had to make the vehicles more market specific, but as a consumer I'm more interested in the cars spec'd as they are on the other side of the pond. So they effectively went down-market to remain in this market.

In ten years, worldwide car markets will be unrecognizable vs today. Every OEM is currently reevaluating where they fit with all the EV startups. Even exploring every legal avenue to hinder fair competition. But as ICE vehicles become increasingly irrelevant, the smart ones will outsource categories that are outside their core competency (e.g. VW Group foreseeing the vacuum in off-road that Jeep seems hell bent on creating; so investing in Scout and Rivian).

The danger is that VW Group continues trying to be all things to everyone. They know their luxury audience, but Audi is losing its way. The folks' wagons are expensive and baffling. Meanwhile Seat/Skoda/Cupra keep churning out cool, affordable both EV and ICE. Stellantis is in a similar rut. Toyota perfected the hybrid, yet inexplicably can't make a decent EV. Nissan needs
Honda just to survive. Volvo/Polestar/Geely can't read the tea leaves. Ford seems devoted to driving dealer markup. If these legacy brands don't pull it together, they will have nothing left but lumps for luddites!

 

[timmyhil]

In ten years, worldwide car markets will be unrecognizable vs today. Every OEM is currently reevaluating where they fit with all the EV startups. Even exploring every legal avenue to hinder fair competition. But as ICE vehicles become increasingly irrelevant, the smart ones will outsource categories that are outside their core competency (e.g. VW Group foreseeing the vacuum in off-road that Jeep seems hell bent on creating; so investing in Scout and Rivian).

The danger is that VW Group continues trying to be all things to everyone. They know their luxury audience, but Audi is losing its way. The folks' wagons are expensive and baffling. Meanwhile Seat/Skoda/Cupra keep churning out cool, affordable both EV and ICE. Stellantis is in a similar rut. Toyota perfected the hybrid, yet inexplicably can't make a decent EV. Nissan needs
Honda just to survive. Volvo/Polestar/Geely can't read the tea leaves. Ford seems devoted to driving dealer markup. If these legacy brands don't pull it together, they will have nothing left but lumps for luddites!

All legacy automotive companies should be taking a BMW stance since they seem to be the only one able to compete with Tesla and other Pure EVs. BMW i series is like it’s completely own brand(not line of vehicle) compared to the ICE versions. That’s how all other Legacy Auto should be doing it.

All the Legacy companies are like rebrand and deciding to go all overnight basically thinking they will be profitable By going EV which is false since most people still have gas cars and some aren’t willing to go full EV. Best example Jaguar, the last time I’ve seen a jaguar was probably 14 years ago. But they think the rebrand is going to make them huge when in reality it was a waste of money. They should have just upped their marketing budget.

 

[Chuckles]

All legacy automotive companies should be taking a BMW stance since they seem to be the only one able to compete with Tesla and other Pure EVs. BMW i series is like it’s completely own brand(not line of vehicle) compared to the ICE versions. That’s how all other Legacy Auto should be doing it.

All the Legacy companies are like rebrand and deciding to go all overnight basically thinking they will be profitable By going EV which is false since most people still have gas cars and some aren’t willing to go full EV. Best example Jaguar, the last time I’ve seen a jaguar was probably 14 years ago. But they think the rebrand is going to make them huge when in reality it was a waste of money. They should have just upped their marketing budget.

Jaguar is unable to compete with the German luxury brands. They don't have the tech or cachet. Most of their models aren't profitable. Marketing only helps so much. Going upmarket is their last-ditch effort for survival. It's a big swing, but they have no other choice. If they continue to lose money they drag Land Rover down too.

 

[timmyhil]

Jaguar is unable to compete with the German luxury brands. They don't have the tech or cachet. Most of their models aren't profitable. Marketing only helps so much. Going upmarket is their last-ditch effort for survival. It's a big swing, but they have no other choice. If they continue to lose money they drag Land Rover down too.

Very true.

I think Land Rover is better off selling them. When they did that commercial for the brand not the car(zero car visible) they dragged land rovers stock price down hard.

 

[joewilk45]

The current problem is cost and style most of us on this forum probably owned some great vehicles in our day fine lines performance and owe yes the back seat memories. But the current EV's most that are affordable lack style and forget back seat memories. I have been lucky enough to own high end cars and SUV's . But people cannot afford the current offerings plus not everyone owns a garage.. I currently drive a Volvo XC90 Recharge Ultimate air suspension etc ( 85k ) out the door yes it has all the bells and whistles and 40 miles of pure EV range love the vehicle and will transition into the Scout but the average person who is deciding between and EV or Camary it's an easy cost decision buy the time you add home chargers and installation cost the average family will be going ice instead of EV

 

[JungGravy]

The current problem is cost and style most of us on this forum probably owned some great vehicles in our day fine lines performance and owe yes the back seat memories. But the current EV's most that are affordable lack style and forget back seat memories. I have been lucky enough to own high end cars and SUV's . But people cannot afford the current offerings plus not everyone owns a garage.. I currently drive a Volvo XC90 Recharge Ultimate air suspension etc ( 85k ) out the door yes it has all the bells and whistles and 40 miles of pure EV range love the vehicle and will transition into the Scout but the average person who is deciding between and EV or Camary it's an easy cost decision buy the time you add home chargers and installation cost the average family will be going ice instead of EV

The legacy automakers are sitting on their hands when they are already at scale to produce affordable and stylish EVs.

I think they're hoping the EV-only companies will fail to scale up in time to grab ALL the price points. Lucid, Rivian, Tesla, and several SE Asian companies have already proven they can design and build stylish, exciting, technologically superior vehicles. And particularly the Asian ones are well on their way to scaling up for affordable volume versions too.

The legacy OEMs just sit still, betting on negative press, legal maneuvering, anything but retooling for volume EV production.

 

[1966sportop]

As much as I favor and want to participate in the direct sales model, I think there is some legitimacy (logical, not necessarily legal), to the argument that VW "controls" Scout. I mean, they're owned by them, right? Follow the money. Where are Scout's profits going to go? 100% reinvested into Scout? 100% sent back to the mothership? Or some blend in-between? One could argue that the current relationship was specifically architected for the express purpose of bypassing the dealer requirement while preserving the most direct ownership. It's not going to be enough, not in every state at least, to avoid being subject to existing franchise requirements. They're going to have to IPO, with VW taking a minority stake, at whatever level is below the definition of "control", while still being high enough to influence the things they want to. Even having a seat on the board might be too much. I'd like to hear the opinion of someone with a legal background on corporate structure. I wonder if any of the cases that will result from this have the potential to reach the Supreme Court, or is this already firmly established case law?

But doesn’t vw own Porsche and many other brands why can’t scout be scout. Vw deals don’t sell the other brands vw owns so why is this any different?

 

[joewilk45]

VW is like GM they have different divisions but all the profits from Chevy, Cadillac, Buick etc. comdd ex back to GM. If you notice any refrece to Scout is usually preceded by VW backed Scout .... so I am sure this will all play out in court in meantime pick your color and control what you can. And in 18 months we will all know what to expect

 

[blmtnc]

But doesn’t vw own Porsche and many other brands why can’t scout be scout. Vw deals don’t sell the other brands vw owns so why is this any different?

All those other VW brands are subject to dealer franchise laws under the legacy definitions. That's what sets Scout apart from all of them, their engagement in a different retail sales model. And all those other brands are considered under VW "control". Scout's structure is different from those (one step further removed), and the argument is that it doesn't meet the definition of "control" in these legacy franchise laws so therefore not subject to the requirements.

 

[joewilk45]

We will get confirmation of this in 12 to 18 months regardless who wins a scout will be in my driveway. I think Gray with black roof looks nice