Managing Recalls at Volkswagen

As you all probably know, the Volkswagen group is currently struggling a big crisis due to the so called “Diesel-gate” scandal. There are plenty of articles regarding this topic, so I just want to shortly summarize the main facts: On September 15 in 2015 the US environment authority EPA detected excessively high exhausts in Diesel cars of VW in the United States. Further investigations revealed that a manipulated software was able to detect whether a car is run under normal conditions or tested in a laboratory. In the last case, the engine was regulated in a way that critical values of exhausts were met, while in normal use these values were much higher.

See the following video for technical details:

In the following months the stock price dropped harsh and sales went down. But this is not the only problem Volkswagen now has to solve. Besides big losses in image and trust the company has to develop a plan, how they want to repair all the affected cars. And this is huge logistic challenge.

Let’s have a look at some facts: About 11 million cars worldwide are affected. Sales of these cars are spread among all over the world, as the following table shows

Country Volkswagen Audi Škoda Seat Commercial Vehicals Total
 Germany 1.537.896
(incl. Commercial vehicles)
531.813 286.970 104.197 s. u. VW 2.460.876
United Kingdom 508.276 393.450 131.569 76.733 79.838 1.189.866
France 574.259 189.322 66.572 93.388 24.523 948.064
Italy 385.694 231.729 35.343 39.598 17.348 709.712
Spain 257.479 147.095 37.082 221.783 20.187 683.626
United States 482.000 13.000 495.000
Belgium 197.328 121.712 51.069 23.539 393.648
Austria 180.500 72.500 54.300 31.700 24.400 363.000
Sweden 104.000 57.000 28.000 2.000 33.000 225.000
India 180.000
Netherlands 160.000
Czech Republic 38.000 7.000 101.000 1.800 147.800
Norway 77.580 27.649 19.947 0 21.963 147.139
Polonia 66.870 12.049 58.890 3.694 141.503
Swiss 128.802
South Korea 125.522
Portugal 102.140
(incl. Audi, Škoda)
15.000 117.000
Ireland 47.316 29.169 16.004 5.039 9.224 106.752
Romania 105.000
Canada 100.000
Australia 61.189 16.085 5.148 0 17.256 99.678
Denmark 91.000
Finland 50.000
Slowakia 14.809 3.278 26.000 2.577 46.664
Argentina 42.716
Hungary 40.095
Mexico 32.000
Taiwan 17.744
Brasil 17.057 17.057
Greece 6.362 1.875 0 0 882 9.119
New-Zeeland 4.639 1.600 1.328 0 133 7.700
China 1.950
Cyprus 480 598 103 119 49 1.349
Worldwide 5.000.000 2.100.000 1.200.000 700.000 1.800.000 10.800.000

National authorities urged Volkswagen to recall all affected models to the service centers to repair the cars so that they can guarantee to meet the emission limits under any circumstance. After receiving this request, the company asked for some time in order to be able to develop a solution to fix the problem and to plan a schedule that allows a quick maintenance or repair in the garages.

Volkswagen calculated that the maintenance for each car would take between 30 and 45 minutes. Slight differences may occur between different models. In some cases, cars only need a software update, in other cases the engine has to be modified completely. Once this data was available, the schedule could be planned. Developing this scheduled is a big task, because repairs of the affected cars have to be done alongside the daily business of the garages.

So the scheduling had to be managed in a way that on the one hand, recalls could start as early as possible and quickly, on the other hand there are some capacity constraints in many garages. The overall goal is to plan the recall effectively, so that waiting time for customers is minimized. This is important not only in order to carry out their duty and fulfill the set requirements, but also to put a sign to the public that Volkswagen is treating the subject seriously, which gives the possibility to overcome the crisis and recover trust.

Due to the huge number of manipulated cars the whole recall process will take up to two years, with regional differences. And this date only holds assuming that everything works as expected and that no further problems occur.




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