News - Volkswagen
User-choosers in Volkswagen’s sights
Volkswagen sweetens finance deals with minimum future value to help retain buyers
19 Apr 2015
KEEPING buyers in the Volkswagen family is the aim of the company’s new-to-Australia finance deal, which revolves around a future value guarantee for a chosen VW model at the end of a finance contract.
The Volkswagen Choice deal is the German car-maker’s latest effort in improving customer relations and retention following last year’s poor showing in the JD Power Customer Service Index that measures buyer satisfaction by brand based on after-sales service.
Volkswagen’s financial services brand manager Peter Sutton said the guaranteed future value program is a strategic fit for the brand Down Under.
“We are letting customers know where they fit in three or four years, it's peace of mind and taking away risk when purchasing a vehicle,” he said.
“You want your customers to come back, we want people to be buying more Volkswagens more frequently, and keeping people in the brand and part of the Volkswagen family.”
The program is applicable to new and demonstrator passenger and light-commercial vehicles, offering the option of financing the full on-road costs, or paying a deposit plus trading in an existing vehicle, or a combination of two methods.
Mr Sutton said the finance options can cover periods between 12 and 48 months and up to a maximum of 25,000km per year.
The company has conditions relating to “reasonable wear and tear” for the minimum future value to be upheld, including regular maintenance and roadworthy condition of tyres.
For example, Volkswagen’s Fair Wear and Tear guide allows for minor dents (20mm in diameter) as acceptable “as long as the paint surface has not been penetrated so that bare metal is visible or corrosion has set in but “multiple dents occurring on a single panel (no matter how small) are unacceptable, and the panel should be repaired or replaced.”
At the end of the contract, the buyer can retain the vehicle and pay out the contract, or refinance the existing vehicle, or buy a new Volkswagen and trade-in their existing car, with the minimum future value a baseline for the changeover price – VW says a trade-in value would depend on the condition of the vehicle but would be no lower than the minimum future value of the vehicle as per the original purchase agreement.
The program is already underway in the United Kingdom and Mr Sutton said the customer retention rate is high.
“We're excited about this, it works well in the UK. Forty six per cent of all finance customers come in on it in the UK, and only five per cent are returning their vehicle, so it's quite effective in getting people into the brand quite early,” Mr Sutton said.
Sister company Skoda introduced a similar scheme in Australia last month.
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