As discussed last week, lost in the chaos about Volkswagen’s
deception in fooling regulators about the emissions of its “clean” diesel
engines is the very real economic damages of used car dealers who purchased VWs
for resale. Those small businesses are
now left holding the bag because of VW’s deception. The same is true for
branded VW dealers who have hundreds of thousands of dollars — if not millions
— in inventory that now can’t be sold.
Having to hold that inventory causes serious economic harm
to dealers. That is because there is a
daily cost for holding pre-owned inventory on a used car lot and used cars lose
their value while sitting on a used car lot for an extended period of time. Profit
margins for used cars begin to dramatically decline after the vehicles are on a
lot for more than 30 days. Further, there are costs incurred in holding
vehicles in inventory. The same is true
for new vehicles, sitting on branded VW dealers’ lots.
Those small business owners might need to buckle in for a
long ride. This morning, Volkswagen
announced that it will launch a massive recall in January of the VW cars that
have been affected by this scandal.
Evidently, a software update might be sufficient for most cars, but
other vehicles might require new fuel injection equipment and catalytic
converters.
VW said that the recall won’t begin until at least the new
year and only after German authorities have approved the company’s plans to fix
the cars. And even when it starts, VW
does not believe that it will be completed until the end of 2016.
So small business owners — used car dealers and VW branded
dealers — are looking at several more months — if not a year — until a real fix
is instituted and the economic pain caused by VW’s deception can begin to
subside.
If you or a loved one have purchased any of these vehicles,
please contact the attorneys at Chhabra & Gibbs, P.A., at 601-948-8005 or
by going to our website at http://www.cglawms.com . You deserve to be
compensated. It doesn’t cost you anything to call and talk to an attorney to
see what options you have.
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