VW Dealers Form Committee To Try To Avoid Lawsuit

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Volkswagen retailers tapped a five-member committee to open settlement talks with the automaker aimed at recovering financial damages sustained by VW’s 652 U.S. dealerships in the wake of the company’s emissions crisis.

The decision came at a nearly two-hour dealer-only meeting last Friday on the sidelines of the National Automobile Dealers Association convention in Las Vegas, and ahead of a Saturday dealer-only meeting where VW brand Chairman Herbert Diess and North America chief Hinrich Woebcken spoke to dealers.

Jason Kuhn, chairman of Kuhn Automotive Group in Tampa, and one of the five negotiators named to the committee, said the quintet hope to begin settlement talks with VW leadership as soon as possible. Kuhn said it was too early to discuss what forms of compensation an acceptable settlement should include.

“The task is to meet with the Germans to negotiate a settlement for the dealers and to bring a settlement package back that we feel is acceptable to get past this,” Kuhn told Automotive News after the private meeting. “At the end of the day, we both need to get past this, and doing it in a courtroom is not acceptable.”

Talk of dealer lawsuits against the factory has gained momentum in recent weeks following the abrupt departure of VW of America CEO Michael Horn on March 9.

By forming the committee, VW dealers aim to reduce the risk that restive dealers will sue the automaker in large numbers.

Kuhn said the “almost unanimous consensus” of VW dealers who attended the meeting, which he estimated represented at least half of VW’s U.S. dealerships, was to avoid litigation “and start selling cars again.”

Some individual dealers may still sue, he acknowledged, but forming the negotiating committee would help to unify most dealers behind an out-of-court compensation process.

“The dealer network, I believe, has been splintered up until now, and I believe that we are now more unified than before, at least since this crisis began,” Kuhn said. “This is a tremendous success that came out of the meeting.”

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