Volkswagen Australia wants people to perceive its brand as semi-premium, placing it below the high-end German luxury offerings from Audi, BMW and Mercedes-Benz but a cut above the mainstream Japanese and Korean contenders in the market.
The company’s mission, encapsulated by the corporate slogan ‘premium for the people’, is being led by managing director Michael Bartsch, now almost a year into the job and set on shifting the company’s culture.
“It’s my opinion that we have a lot of opportunities with the brand in Australia to create a very unique positioning in the market that sits right underneath the luxury brands of Mercedes and Audi, but well above the Japanese and Korean brands,” he said this week.
The plan will see the company continue to roll out products at a slightly higher price than other big-volume brands, but will also comprise a significant upgrade of its servicing and sales culture, to better fit with this stated positioning.
“The products will remain what Volkswagen has always been… we will never be the cheapest car in the market, that simply won’t happen, but we will always remain an extremely strong value proposition for German-made, premium quality. It’s important we are something to aspire to,” he said.
“I don’t think anyone wakes up in morning saying they’re aspiring to own a Korean car or a Corolla… [but] that’s where we have to get this brand, well and truly established as something that remains aspirational.”
More important, though, is overhauling the company’s service culture. Volkswagen has not performed well in numerous dealer satisfaction surveys, and the company has for some time acknowledged it has a problem here.
Bartsch has the attitude that the most important part of a restaurant is the kitchen, and the most important part of any dealer is the workshop. Volkswagen Australia (VGA) now has a board level director of customer experience, has spent money on greater tech training and gives its master technicians (35 will graduate per year) Amarok company cars.
“One of the big challenges for Volkswagen is still the aftersales business,” he said.
“If you were to ask anyone internally where does our focus lie, the absolute focus is getting the back end, service culture of business aligned with where we currently stand in terms of sales penetration.
“That’s very much the position we have with our dealers… everybody knows in this business you sell the first car at the front end and the second via the back end.”
From a front of house perspective, VGA is also investing in greater training for sales staff, and is intent on simplifying and shortening the buying process, removing the process of hand-balling buyers between sales, finance and accessories departments, and setting higher standards for showroom decor.
What do you think? Can Volkswagen achieve its aim of being a pseudo premium player in Australia?