German VW dealers failed to recommend the brand’s flagship electric car, the ID.3, to secret shoppers with a “suitable driving profile,” according to a new study by Greenpeace. Out of 50 dealers visited, only eight of them (16%) recommended the ID.3, and the percentage was even lower (4%) for customers who didn’t specifically mention they were considering the ID.3.
VW has been talking big about electric cars for quite some time now, and just this week the VW board backed CEO Herbert Diess and his aggressive electrification plan that has been receiving internal pushback from the company. These electrification plans are key to VW meeting increased EU fuel economy standards that will be ramping up quickly in coming years.
VW has also invested a lot of money and effort into building EV-specific factories, rolling out fast-charge networks across the EU and US, developing and marketing new electric car models, and so on. Their first ground-up mass-market EV is the ID.3, for which they have high sales and production targets.
But…what about the dealers? Dealerships have presented a significant hurdle for EV adoption, as we’ve seen before in other studies utilizing secret shoppers. There is a pattern of them lacking knowledge or even actively working to discourage buyers from purchasing an EV.
In this vein, Greenpeace has just released a study showing that VW dealers, even on their home turf in Germany, are apparently not prepared to aid VW in its electric car goals. Their study showed that dealerships lack the training and incentives they need to sell electric cars and are actively discouraging even suitable buyers from purchasing them.
The study included 50 “secret shopper” visits to a selection of the 865 German VW dealerships that carry the ID.3. All shoppers stated a “suitable driving profile” that VW acknowledges would make them a good candidate for ID.3 ownership. Half of the secret shoppers said they were trying to decide between the ID.3 and a gas-powered Golf, and half gave no preference about which vehicles they were looking into.
Of the first group, dealers recommended the ID.3 to just 7 out of the 25 shoppers. The second group fared worse, and only one of the 25 had the ID.3 recommended to them.
All shoppers also asked multiple questions about electric cars: charging station availability, can you charge at home, will it overload the power grid, are they a greater fire hazard, and what it means for the ID.3 to be “climate neutral.”
Nearly half (48%) of the answers given to these questions were wrong, or the dealer was unable to give an answer. On top of this, several dealers volunteered various fearmongering myths about electric cars to discourage shoppers from buying them.
Worse, the very fact that these questions were asked means that electric cars came up in every one of these conversations, so dealers can’t claim that they just weren’t thinking about electric cars. In every secret shopper conversation, electric cars were discussed, and yet in 84% of them the dealer did not recommend VW’s flagship EV, the ID.3.
Most dealers did successfully name advantages of EVs over gas vehicles, though. The most-named advantage was “driving fun.” Among other benefits mentioned were environmental benefits, government incentives, and lower energy and maintenance costs.
This looks bad for the dealers, but dealers actually pointed the finger back at VW for not giving them enough preparation or incentive to sell these cars.
VW touts their preparation, stating that they have invested a “seven figure sum” in training (for comparison, VW’s yearly revenue is $252 billion, which is 12 figures). But clearly this investment has not paid off, given the dismal results of the study. If dealers are getting half of their EV-specific answers wrong, then the training isn’t working, or isn’t comprehensive enough.
Training would need to be comprehensive, too, since VW is using a new “agency” sales model for EVs. In many ways this new model makes the sale easier for dealerships, but any change is still going to need a lot of explanation to businesses that have been doing things the same way all along and are suddenly being asked to act differently just for this one new model.
Incentives have lagged, too. According to the study, dealers get a higher margin on sales of combustion vehicles, giving them more profit and flexibility to reduce the price of the car in order to get a sale. This incentivizes salespeople to be good at negotiation, to maximize their commission (though it makes the experience worse for the consumer who has to deal with a pushy salesperson).
VW has even excluded EVs from certain promotions, like one this summer in which VW gave reduced VAT to customers, and the ID.3 and e-Up were both excluded from this promotion. Dealers say the company offers no specific bonuses or quotas for dealerships in terms of EV or low-carbon car sales, though dealers do get commissions even when a car is purchased online.
VW says that they’ve taken a hands-off approach, claiming (translated through Google Translate): “We basically leave the design of the seller’s commission systems to our trading partners and since they are independent entrepreneurs, we cannot influence this either.”
Greenpeace points out that it is possible for dealers to overcome these hurdles, though. One dealer in Tarmstedt managed to deliver 47% of their sales as electric in the first three quarters of this year. This shows that if a dealer does want to sell a lot of electric cars, they can — it just takes an active interest in doing so, rather than passively relying on VW’s incentive and training system and pointing fingers or shrugging your shoulders when customers don’t want to buy a car you’ve actively discouraged them from buying.
Greenpeace ends their study by pointing the finger at VW themselves. They demand that VW no longer punish dealers for selling EVs (by excluding them from incentives), better prepare its dealerships with EV training, and that VW and both German and EU governments should massively accelerate plans to end the sale and development of internal combustion engines, not just focus on doing the minimum possible to meet requirements.
In virtually every conversation I’ve had with a representative of an auto manufacturer, I’ve known more about that manufacturer’s electric vehicle offerings, and more about electric vehicles in general, than the person I’m talking to. This is true of dealers, ride-and-drive co-drivers, auto show exhibitors, and many company executives (and then there are the bonehead CEOs, too).
All of this is not meant as a boast — most of our readers could probably say they’ve had a similar experience. How many of you have gone for a test drive and had to explain how charging rates work, what a kilowatt-hour is, etc.? Or, even worse (but still common), have been actively discouraged by the dealer from buying the electric car you came in to test drive?
There are exceptions of course. Usually, those exceptions come from the company’s “EV guy” — an executive who is leading the internal charge for electric vehicles, usually highly placed in some sort of “new technology” division. Or the one guy at the dealership, or the one dealership in the area, that has put a specific focus on learning about EVs. There’s always at least a few of them who do truly “get it” and can have a frank and knowledgeable conversation about electric cars.
To be fair, executives and dealers have a whole company to focus on, not just one division or one car. But it’s clear that electric vehicles are happening, and happening fast. Soon enough, electric vehicles will be the only division in these companies, because countries are announcing gas car bans coming within the next decade, and it’s likely that consumers will get on board even before then.
So whether companies want to or not, they need to shape up quickly. There’s a lot to learn, and a lot to teach, and a lot of effort required to turn these large ships. VW has been putting in more effort than any of the major manufacturers, and still their efforts have proven deficient, even on home turf.
VW does get some credit for walking a difficult line here. Part of the reason they’re moving to a whole new sales model for EVs is because of the difficulties that dealerships have always presented in selling electric cars. By centralizing their sales efforts, they can sell cars online without relying on their evidently intransigent dealerships. This will hopefully make the sales experience less stressful for shoppers. But owners will still have access to VW’s large dealer network for service and support post-sale, which is a real benefit.
But the effort is still not enough. Greenpeace cites that many companies, including VW, seem to be doing the minimum possible to hit EU fleet emissions targets, to remain compliant without exceeding goals or pushing the envelope of technology or driving experience any further.
VW brand sold over 6 million cars last year, and only 80,000 of them had a plug. That’s about 1%. We’re not going to get anywhere on climate change if massive companies that are responsible for so much pollution (not to mention killing thousands of people by lying on emissions tests) only do the minimum possible. We agree with Greenpeace — knock it off with the internal combustion, VW.
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