Volkswagen won't compensate consumers in Korea

By Jhoo Dong-chan

A group of Korean consumers, who bought Volkswagen vehicles with emissions software giving fraudulent readings, submitted a complaint with the government, demanding full refunds or the ability to exchange their cars. But Audi Volkswagen Korea, the German automaker’s local unit in Korea, made it clear that it does not have any plans to compensate Korean consumers as it has yet to be convicted of any crime under Korean law.

According to the Barun Law firm on Thursday, which represents a total of 4,430 Volkswagen consumers, it filed the complaint with the Ministry of Environment under the Clean Air Conservation Act. The consumers had previously submitted the same complaint only to be rejected by the government because the ministry said it is a matter of recall, not an issue of full refunds or exchanging cars.

The consumers’ move followed the automaker’s recent announcement that in the United States it will carry out a $15.3 billion (17.75 trillion won) compensation plan that includes paying each consumer a maximum of $10,000. A total of 475,000 U.S. consumers are expected to receive the money.

Separate from the plan above, the German automaker decided to pay the U.S. Federal and California State Governments $4.7 billion for helping fund their emissions reduction programs.

In Korea, however, the German automaker is expected to only carry out a recall program along with a 10 billion won donation.

“Korea has a different set of environmental regulations along with penalty rules. It is natural for us to have a different set of consumer plans," said an Audi Volkswagen Korean official.

“Volkswagen won’t carry out any compensation plan before being convicted in court.”

Consumers are outraged.

“I am disappointed by Volkswagen’s discriminating measures,” said a Volkswagen Tiguan SUV owner surnamed Choi.

“The government should come up with tougher measures against unethical acts by automakers.”

The litigant group said it will charge the Ministry of Environment with dereliction of duty if it rejects their demands once again.

An industry insider blames consumers’ blind faith in foreign auto brands as another reason for Volkswagen’s arrogant attitude in sales.

“Despite the emissions scandal, Volkswagen’s sales are still strong in Korea. If such irregularities were reflected in their sales, their reaction would be different,” he said.

According to market data, Volkswagen suffered a sales loss in October last year after the scandal came to the surface but retook the No. 1 position in sales among foreign auto brands in November as they carried out a discount promotion.