Can Volkswagen rebuild confidence and reverse its fortunes in Malaysia?

Volkswagen’s official distributor in Malaysia early this week launched an innovative two-year customer care and goodwill package on DSG twin clutch gearboxes for its cars made up to 2013.

If you have a limited budget but appreciate technology and enjoy driving, why is this important to you?

Well, Volkswagen (VW) cars in Malaysia are one of the best buys in the used car market because of something bad that happened two years ago and this offer by the new official distributor, Volkswagen Passenger Cars Malaysia (VPCM) opens up many opportunities for motoring enthusiasts on a budget.

The new offer is an additional 2-year “VPCM Customer Care Goodwill” programme on the Direct Shift Gearbox (DSG) on cars produced till December 2013, with mileage of up to 200,000km.

"This goodwill takes place after the expiration of the 5-year warranty period on these vehicles. Additionally, “VPCM Customer Care Goodwill” is also offered on other selected components for Volkswagen cars that have passed its 5-year warranty period expiration date,” VPCM announced on Tuesday (Dec. 6).

The cars that will easily fit into this Customer Care goodwill and also the most interesting cars in terms of value-for-money are the Passat, Golf, and Polo made between 2010 and 2013.

VW cars older than 2010 would probably have fallen out of the official service network and then harder to qualify for the goodwill programme.

We spoke with the PR managers and they emphasized that it was a goodwill programme where both sides had to be fair.

"Second-hand VW cars are eligible to the two year customer care goodwill programme even if it’s not the first owner. We’ll follow the VIN code of the car.

What is important is that the car has been serviced by the official VW dealers. But let’s say that the car is made in 2010 and registered in 2011. Its five year warranty has just expired and the owner has serviced the car outside the official network. Only one service outside the network.

"This is where our aftersales people will have to make a judgement call and decide whether to extend the VPCM Customer Care Goodwill programme,” said a manager familiar with the matter but not authorised to speak on behalf of the company

"Another discretionary item is the sharing of the labour costs for repair work done under the goodwill programme. If it’s a big job and the value of the components is high, we will ask the customer to pay some of the labour cost borne by the service dealer.

"We’re looking at the customer to share the labour cost and in exchange for this, we can offer a full additional warranty on parts and total labour costs,” the manager said.

Indicative prices of Passat, Golf, and Polo – among the desirable VW cars – have more than halved in some cases.

The above indicated prices are from used car listings and there are unscrupulous dealers who will wind back the odometers. It’s a RM100+ job and it’s not a punishable offence yet. Rather, there have been no prosecutions yet by the Domestic Trade Ministry or the consumer’s tribunal.

If the upholstery is sagging and worn, then it’s better to doubt the 55,000 km indicated on the odometer.

Another thing about the used car listings: some of the dealers describe the cars displayed as “King Cars”. This is a direct translation from the Cantonese “Chay Wong” and is meant to tell you that this particular car is in impeccable condition.

The VPCM Customer Care Goodwill programme is unprecedented in Malaysia.

It addresses the issue of the twin clutch gearbox (DSG or direct shift gear) problem that manifested in the seven-speed dry clutch DSGs.

"At VPCM, our customers are our top priority and we have taken into account feedback we’ve received from our VW owners. On the 1st of September, VPCM announced the 5-year manufacturer warranty for our cars.

"With the introduction of the ‘VPCM Customer Care Goodwill’, we hope to further enhance the overall ownership experience and give existing customers better protection and peace of mind. The goal is to build trust and confidence with our customers as we continue to strengthen our brand presence and share in the Malaysian market,” said Florian Steiner, Managing Director of VPCM.

The 7-speed DSG had a design flaw that was a worldwide issue which was managed with customers’ generally satisfied except Malaysia.

Those VW owners with malfunctioning seven-speed DSG’s and other related issues then used social media to organize a demonstration in front of VW Malaysia’s office in Bangsar, Kuala Lumpur.

After that, resale value of VW cars spiraled downwards.

VW’s diesel gate was also a watershed year for Malaysia. The new management in Wolfsburg restructured its China operations and its subsidiaries including VGM.

VGM is now devolved to the import of CBU cars and CKD packs and the assembly of VW cars in its contract factory in Pekan, Pahang.

The role of national distribution is awarded to Porsche Holdings Salzburg (PHS), the largest retailer of used cars in Europe.

As reported by us, PHS was earlier this year drafted to be the official distributor of VW cars in Malaysia.

The Salzburg-based company was founded in 1947, and operates today in 26 markets in Western- and South-eastern Europe, China, and in Columbia and Chile in South America

"It’s two years too late, but better late than never,” commented an industry participant on the VPCM initiative to rebuild consumers’ trust in the VW brand.

Additionally, Economy Packages on specific models older than 5 years is also in the midst of being implemented at Volkswagen authorized dealer partners, and will be announced in due time.